The World Bank has scheduled December 16, 2025, as the tentative approval date for a new $1 billion Development Policy Financing (DPF) loan to Nigeria under an initiative titled “Nigeria Actions for Investment and Jobs Acceleration (P512892).”
According to a project document released by the Bank on October 27, the facility comprises a $500 million International Development Association (IDA) credit and a $500 million International Bank for Reconstruction and Development (IBRD) loan.
Falling under the Bank’s Macroeconomics, Trade, and Investment practice area for Western and Central Africa, the funding aims to strengthen ongoing economic reforms, promote job creation, and accelerate private investment.
The new DPF is part of the World Bank’s broader support package to consolidate Nigeria’s post-reform stability and drive inclusive growth across key sectors. It will be implemented through the Federal Ministry of Finance, with the Bank confirming that the loan preparation process has been authorised to proceed.
“The proposed Development Policy Financing supports Nigeria’s pivot from stabilisation to inclusive growth and job creation. Structured as a two-tranche standalone operation of US$1.0 billion (US$500m IDA credit and US$500m IBRD loan), it seeks to catalyse private sector–led investment by expanding access to credit, deepening capital markets and digital services, easing inflationary pressures, and promoting export diversification,” the document stated.
Since 2023, Nigeria has embarked on a series of bold economic reforms, including the removal of the petrol subsidy, the unification of exchange rates, and an end to central bank deficit financing.
The Federal Government has credited these measures—championed under President Bola Tinubu’s Renewed Hope Agenda—with helping to stabilise the economy, narrow the fiscal deficit, and restore investor confidence.
However, despite these improvements, economic growth remains sluggish, with over 130 million Nigerians still living in poverty. The World Bank noted that while macroeconomic stability has largely been restored, “Nigeria’s economy has yet to shift decisively into a higher and inclusive growth path,” underscoring the need for renewed investment to spur productivity and job creation.
The $1 billion DPF is structured around two main pillars:
- Unlocking private sector growth and reducing the cost of doing business.
- Expanding opportunities across agriculture, trade, and digital services.
Under the first pillar, the programme aims to broaden access to finance and digital inclusion. It supports reforms such as the Investment and Securities Act 2025, new credit enhancement facilities, and a Central Bank Rulebook to strengthen microfinance and non-bank financial institutions.
It also backs the National Digital Economy and E-Governance Bill 2025, which will establish a legal framework for electronic transactions, authentication services, and digital records—key steps toward building a modern, paperless governance system.
The second pillar focuses on reducing inflationary pressures and enhancing Nigeria’s export competitiveness by simplifying trade barriers, adopting AfCFTA tariff concessions, and improving certified seed systems for staple crops like rice, maize, and soybeans. These measures are expected to boost productivity, strengthen food security, and attract private investments into the agricultural value c
The $1 billion DPF forms part of a broader FY2026 World Bank programme aligned with Nigeria’s growth agenda. Complementary projects include:
- FINCLUDE – improving MSME financing.
- BRIDGE – expanding digital infrastructure.
- AGROW – promoting agricultural value chain growth.
Together, these projects are expected to attract private capital, expand access to finance, and create an enabling environment for small and medium-sized enterprises.
Aligned with the Paris Climate Agreement, the initiative also includes climate-resilient agriculture, reduced deforestation, and digital governance components designed to lower emissions from paper-based systems.
The Bank projects that the reforms supported under this operation will help reduce food inflation, increase seed productivity, and expand digital exports—creating millions of direct and indirect jobs. Enhanced access to credit for MSMEs and smallholder farmers is expected to “expand economic opportunities and create jobs, including for the poor,” the document added.
Additionally, reduced import bans and lower tariffs on essential inputs should make goods cheaper, improve consumer welfare, and boost Nigeria’s competitiveness in regional market.
Upon approval, the funds will be disbursed in two tranches as policy milestones are achieved, with oversight by the Federal Ministry of Finance, the Central Bank of Nigeria, and relevant ministries.
The initiative marks one of the World Bank’s largest policy support operations for Nigeria in recent years and is expected to anchor the nation’s transition from short-term stabilisation to long-term inclusive growth.
As of June 30, 2025, Nigeria’s external debt stood at $46.98 billion, according to the Debt Management Office (DMO). The World Bank Group remains the country’s largest single creditor, accounting for $19.39 billion—comprising $18.04 billion from the IDA and $1.35 billion from the IBRD—representing 41.3% of Nigeria’s total external debt.
This underscores the Bank’s dominant role in financing Nigeria’s development and reform programmes.
