Reports suggest that Nigeria might be on the verge of securing a massive loan from the World Bank. These reports which were first picked up by TheNewsGuru.com states that the World Bank had in April stated that a powerful delegation from Nigeria was in Washington DC to discuss assistance for the nation’s power sector, but did not disclose the details of the talks.
According to a report by The Punch, those present at April 25, 2017, meeting in Washington DC were the Minister for Power, Works and Housing, Mr. Babatunde Fashola; Minister of Finance, Mrs. Kemi Adeosun; Chairman, Senate Committee on Power, Steel and Metallurgy, Senator Enyinnaya Abaribe; and Chairman, House of Representatives Committee on Power, Mr. Dan Asuquo.At the end of the meeting, the World Bank Group had said that it would deploy a full range of instruments to mobilize investments to resolve Nigeria’s energy crisis.
The Director of Operations at the Multilateral Investment Guarantee Agency, an arm of the World Bank Group, Sarvesh Suri, said a full range of instruments would be deployed to help the government mobilize investments directly from the private sector and through private sector guarantees.
According to the Debt Management Office, out of Nigeria’s external debt of $13.81bn as of March 31, 2017, the World Bank Group had a portfolio of $6.93bn.This means that the World Bank holds more than 50 percent of the country’s external debt portfolio.However, if the loan is approved, Nigeria’s indebtedness to the World Bank would rise to about $11bn, excluding other smaller loans that have been approved after the March 31 accounting date.
The bank had in 2014 announced $1.19bn guarantees meant to lift the nation’s electricity sector. The Board of Executive Directors of three arms of the World Bank approved the package of loans and guarantees supporting a series of energy projects to help boost independent power generation and ease crippling energy shortages in Nigeria.
It said the projects were critical elements of the World Bank Group Energy Business Plan for Nigeria.
The World Bank, International Finance Corporation and Multilateral Investment Guarantee Agency’s World Bank partial risk guarantees approved included $245m for the 459 Megawatt Azura Edo Power Plant near Benin City, Edo State; and $150m for the 533MW Qua Iboe plant in Ibeno, Akwa Ibom State. Both plants are gas-fired.
The Boards of the IFC and MIGA approved loans and hedging instruments worth $135m and guarantees of up to $659m for the Azura Edo project. The IBRD guarantees included forward-looking mitigation and risk-sharing arrangements designed to augment the country’s power sector reforms while building market confidence and setting industry benchmarks.
The IFC investment and MIGA’s guarantee for the Azura Edo power plant were to support a trailblazing project at the center of Nigeria’s power sector program while setting a replicable model for future power projects.
A sect of the public is however concerned that these funds will be diverted for personal gains. We can only hope that this money will be appropriately managed. Let us Know what you think in the comment section. Will these funds spark the change we so badly want to see or is just an elaborate ploy to mismanage funds?