The Federal Government has opened fresh talks with the World Bank for three new World Bank loan totalling $1.5bn, amid a surge in Nigeria’s public debt and an increase to N166.79tn at the end of June 2026.
According to World Bank documents, the proposed financing comprises three separate $500 million facilities targeting early childhood development, social protection and climate resilience.
The most immediate proposal involves an additional $500 million for the Agro-Climatic Resilience in Semi-Arid Landscapes (ACReSAL) initiative. The World Bank has scheduled October 29, 2026, for the board to discuss the proposed funding.
The Federal Ministry of Environment will implement the project, while the Federal Republic of Nigeria will serve as the borrower.
The document noted that, “The Government of Nigeria has requested AF of $500m to scale up demonstrated project results and strengthen the institutional, operational and financing arrangements needed to sustain integrated landscape management.”
The additional funding is expected to support landscape restoration, watershed rehabilitation, erosion and flood control, irrigation and drainage, water harvesting and storage, reforestation, and various climate-resilient initiatives.
Of the additional $500 million, $310 million is allocated for dryland management, $165 million for community climate resilience, and $25 million for project management and institutional capacity building.
The ACReSAL project currently operates across 19 northern states and the Federal Capital Territory, addressing land degradation, water insecurity, climate vulnerability, and declining agricultural productivity.
According to the World Bank, desertification and land degradation affect approximately 43% of Nigeria’s land mass, with projections indicating that unmitigated climate change could reduce the nation’s GDP by up to 2.6% annually by 2030 and 6.7% by 2050.
The second proposed loan
The second World Bank loan proposal involves an additional $500 million International Development Association (IDA) credit for the Household Prosperity and Empowerment-Social Protection Project (HOPE-SP).
The HOPE-SP project remains at an earlier preparation stage than the ACReSAL facility. The World Bank has tentatively scheduled its approval for March 16, 2027, while it plans to conduct a technical design review on October 30, 2026.
The Federal Ministry of Humanitarian Affairs and Poverty Reduction will implement the project, with the Federal Ministry of Finance serving as the borrower.
The project has an estimated cost of $500 million, comprising an $80 million investment project financing component and a $420 million results-based programme. The IDA is expected to provide the entire funding.
It is intended to provide regular social support to low-income and vulnerable households while progressively transferring financial responsibility to state and federal budgets.
The World Bank document also disclosed that the programme would establish “a sustainable social assistance to poor and vulnerable households, financed increasingly from federal and state budgets and delivered through strengthened state and local government systems.”
In addition to modernizing the social registration, integrating the National Identification Number into the social protection information system, and bolstering implementation at the federal, state, and local government levels, the proposed program would finance targeted unconditional and conditional cash transfers.
According to the lender, Nigeria spent just 0.14 percent of GDP on social safety-net programs in 2021, whereas lower-middle-income countries spent 1.2 percent and the world average was 1.5 percent.
The third proposed world bank loan
The Nigeria Early Childhood Development Programme is the third proposed $500 million facility, with approval scheduled for March 15, 2027, one day before the anticipated approval of the HOPE-SP programme. The World Bank has also scheduled the project’s technical design review for October 30, 2026.
The Federal Ministry of Budget and Economic Planning is expected to implement the programme, while the Federal Ministry of Finance will serve as the borrower.
The initiative aims to expand access for children aged 0 to 5 to an integrated package of health, nutrition, early learning, childcare, water and sanitation and other services. The programme will cover all 36 states and the Federal Capital Territory.
The $500 million IDA loan will comprise a $400 million Programme-for-Results component and a $100 million Investment Project Financing component.
According to the World Bank, “40 percent of children under five are stunted, fewer than half are developmentally on track, 36 percent of children aged 36 to 59 months attend organized early learning,” with impoverished rural households bearing the majority of the load.
Debt surge
Nigeria’s overall public debt increased by N14.39 trillion in just one year, from N152.40 trillion in June 2025 to N166.79 trillion by the end of June 2026, according to new data from the Debt Management Office.
That was a 9.44 percent year-over-year gain. However, the expansion was significantly greater when measured in dollars. During the same time period, public debt increased by $21.27 billion, or 21.35 percent, from $99.66 billion to $120.93 billion.
The greater naira utilized to value the June 2026 external debt is one of the reasons for the disparity. In June 2026, the DMO used an official exchange rate of N1,379.1842/$ as opposed to N1,529.2105/$ the previous year. As a result, debt denominated in dollars increased far more quickly than debt denominated in naira.
From N159.35 trillion in March 2026 to N166.79 trillion in June, the debt stock grew by N7.44 trillion, or 4.67 percent, on a quarterly basis.
Meanwhile, domestic debt increased from N87.40 trillion to N4.19 trillion, or 4.79 percent, between March and June of 2026 alone.
Backstory…
Just recently, Atiku Abubakar, the presidential candidate of the African Democratic Congress (ADC) accused President Bola Tinubu of plunging Nigeria further in debt.
In a statement issued by Phrank Shaibu, Director of Strategic Communication for the ADC Presidential Campaign Council, Atiku said the country faced significant economic pressure because of the administration’s heavy borrowing and rising debt-servicing costs.
The ADC candidate said the government continued to borrow “with an exceptional appetite” despite removing the petrol subsidy and celebrating increased public revenue.
Recall that in July, the Federal Government exceeded its 2024 borrowing target by N4.79 trillion because a larger-than-expected budget deficit forced officials to secure far more funding than planned, according to the Federation’s Budget Office.
Read Also: FG Overshoots Nigeria’s Borrowing Limit, New Debt Climbs to ₦12.62tn
