The World Bank has approved $2.25 billion to support President Bola Ahmed Tinubu’s economic reforms, aiming to stabilize the economy and help vulnerable citizens.
Finance Minister Wale Edun announced two key financial aid packages last night.
These packages include $1.5 billion for the Nigeria Reforms for Economic Stabilisation to Enable Transformation (RESET) Development Policy Financing Programme (DPF) and $750 million for the Nigeria Accelerating Resource Mobilisation Reforms (ARMOR) Programme-for-Results (P-for-R).
The statement reads:
“This combined total of $2.25 billion will offer essential financial and technical support as the government continues to address economic distortions.
“These reforms will create quality jobs and economic opportunities for all Nigerians.
“We welcome the support of the RESET and ARMOR programmes as we further consolidate and implement our policy reforms, consistent with accelerating investment and using public resources more sustainably to achieve our development goals.”
When President Tinubu’s administration took over last year, it faced major economic challenges and saw an urgent need for reforms to reboot the economy and strengthen Nigeria’s financial outlook.
Initial measures included unifying multiple exchange rates and stopping hidden petrol subsidy payments to rescue the economy.
The Central Bank of Nigeria (CBN) has focused on price stability, tightening monetary policy by raising interest rates to reduce inflation.
A cash transfer program is being rolled out to help poor and economically insecure households cope with high inflation.
The RESET DPF program aims to strengthen economic policies, create fiscal space, and protect the poor and vulnerable.
“It is essential to maintain the momentum of these reforms and continue to provide support to the poor and vulnerable to mitigate the impact of the cost-of-living crisis.
“This financing package strengthens the World Bank’s strong partnership with Nigeria and supports efforts to rejuvenate the economy and expedite poverty reduction, serving as an example for Africa.”
The ARMOR P-for-R program supports tax and excise reforms, improves tax revenue and customs administration, and protects oil revenues.
The International Development Association (IDA), the World Bank’s fund for the poorest countries, offers highly concessional funding with a 40-year term and an interest rate of just over one percent.
IDA funds help boost economic growth, reduce poverty, and improve livelihoods in the world’s 76 poorest countries, with 39 of them in Africa.
The approval of these financial packages marks a significant step in Nigeria’s efforts to stabilize its economy and set a sustainable path for growth and poverty reduction.
