The minister of Finance and coordinating minister of the economy, Wale Edun, disclosed on Thursday, June 13, 2024, that the World Bank approved two significant support packages for Nigeria.

The loans are part of President Tinubu’s ongoing plans to stabilize Nigeria’s economy, reposition it for growth, and provide quick support to the poor and vulnerable Nigerians.

Nigeria is quickly advancing to economic recovery

The minister stated that the government is undertaking reforms to restore macroeconomic stability and contribute to sustainable and all-encompassing growth in Nigeria.

“We welcomed the facilities tagged RESET and ARMOR programs aimed at consolidating the government’s reform efforts,” Edun said.

The minister first announced the government’s intentions for the loan in April at the spring meetings of the International Monetary Fund (IMF) and the World Bank.

Legit.ng had reported that the World Bank would approve the loan this June to help Nigeria accelerate its economic recovery.

BusinessDay reports that Ousmane Diagana, the World Bank Vice President for Western and Central Africa, disclosed that Nigeria’s comprehensive fiscal reforms are putting the country on a new path to stabilizing the economy and lifting people out of poverty.

RESET and ARMOR

Packages to ease effects of poverty Nigeria will receive the funding through two main development projects: The Nigeria Reforms for Economic Stabilisation to Enable Transformations (RESET) Development Policy Financing.

The RESET project is set to receive $1.5 billion in funding. The second project, the NG Accelerating Resource Mobilization Reforms Programme for Results (ARMOR), will receive $750 million in funding.

Reports say that the World Bank supported Nigeria’s multi-year effort to raise non-oil revenues and safeguard oil revenues to promote fiscal sustainability and sufficient resources to deliver public services.

Nigeria’s debt stock to rise with new loan

The new loan will raise Nigeria’s external debt stock, which is currently at $42.495 billion, according to data from the Debt Management Office (DMO).

The DMO data shows that the World Bank Group is Nigeria’s biggest creditor, with about $15 billion in loans.

The current loan facility will also increase Nigeria’s debt stock above the N97.34 trillion ($100 billion) threshold, which analysts say is too much for a country depending solely on oil as a significant revenue source.