Nigeria is facing the challenge of an unutilized World Bank loan amounting to $8.25 billion as of July 2023.
This information, according to the World Bank’s official Summary Statement of Loans/Credit/Grants, accessible on its website, the substantial sum comprises $7.45 billion from the International Development Association (IDA) and an additional $1.12 billion from the International Bank for Reconstruction and Development (IBRD). The funds encompass loans that have been approved but remain unsigned, alongside those loans for which commitments have been signed.
The global bank said, the reason for the yet-to-be-disbursed loans, particularly the signed loan commitments, is because, the “loans are not effective and disbursements do not start until the borrowers and/or guarantors take certain actions and furnish documents.”, according to its 2022 statements.
Over the years, both the IBRD and the IDA, integral parts of the World Bank, have extended financial assistance to Nigeria.
The IBRD specialises in lending to governments of middle-income and creditworthy low-income nations, while the IDA offers concessional loans, known as credits, and grants to the world’s most impoverished countries.
As previously reported, the disbursement of these loans could potentially elevate Nigeria’s debt owed to the World Bank from $12.72 billion to a staggering $21.15 billion, marking a substantial increase of 66.27 percent.