The Federal Government has opened discussions with the World Bank for three new loans totalling $1.5bn, even as Nigeria’s public debt climbed to a record N166.79tn at the end of June 2026.
Documents obtained from the World Bank show that the proposed financing comprises three separate $500m facilities for climate resilience, social protection and early childhood development.
The most immediate is a proposed $500m additional financing for the Agro-Climatic Resilience in Semi-Arid Landscapes project, known as ACReSAL. The World Bank has fixed October 29, 2026, as the estimated date for consideration by its board. The borrower is the Federal Republic of Nigeria, while the Federal Ministry of Environment is the implementing agency.
The financing would raise the size of ACReSAL from its previously approved $700m to $1.2bn, entirely financed through the International Development Association, the World Bank’s concessional financing arm.
The document said, “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 financing is expected to support landscape restoration, watershed rehabilitation, erosion and flood management, irrigation and drainage, water harvesting and storage, reforestation and other climate-resilient interventions.
Of the additional $500m, $310m is proposed for dryland management, $165m for community climate resilience and $25m for institutional strengthening and project management.
The document said, “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 financing is expected to support landscape restoration, watershed rehabilitation, erosion and flood management, irrigation and drainage, water harvesting and storage, reforestation and other climate-resilient interventions.
Of the additional $500m, $310m is proposed for dryland management, $165m for community climate resilience and $25m for institutional strengthening and project management.
ACReSAL currently operates across 19 northern states and the Federal Capital Territory and is targeted at land degradation, water insecurity, climate vulnerability and declining agricultural productivity.
The World Bank said desertification and land degradation affected an estimated 43 per cent of Nigeria’s land area, while failure to address climate change could reduce gross domestic product by about 2.6 per cent annually by 2030 and as much as 6.7 per cent by 2050.
The second proposed loan is another $500m IDA credit for the Household Prosperity and Empowerment-Social Protection Project.
Unlike the ACReSAL facility, the HOPE-SP project is at an earlier stage of preparation. Its technical design review is expected on October 30, 2026, while the World Bank has tentatively fixed March 16, 2027, as its approval date. The Federal Ministry of Finance is listed as the borrower, while the Federal Ministry of Humanitarian Affairs and Poverty Reduction will implement the programme.
The project has an estimated cost of $500m, comprising a $420m results-based programme and an $80m investment project financing component, with the entire financing expected from IDA.
It is designed to establish regular social assistance for poor and vulnerable households, while gradually shifting financing responsibility towards federal and state budgets.
The World Bank document said 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.”
The proposed programme would finance targeted unconditional and conditional cash transfers, modernise the social registry, integrate the National Identification Number into the social protection information system and strengthen implementation at federal, state and local government levels.
The lender said Nigeria spent only 0.14 per cent of GDP on social safety-net programmes in 2021, compared with a global average of 1.5 per cent and 1.2 per cent among lower-middle-income countries.
The bank also painted a grim picture of household welfare, estimating that the proportion of Nigerians living in poverty had increased from 40 per cent in 2019 to 56 per cent in 2023 and could reach 62.5 per cent in 2026. It attributed the deterioration to several factors, including the pandemic, inflation, natural disasters and conflict, while noting that fuel subsidy removal and exchange-rate reforms worsened living costs in the short term.
The third proposed $500m facility is for the Nigeria Early Childhood Development programme, with an estimated approval date of March 15, 2027, a day before the proposed HOPE-SP approval. Its technical design review is also scheduled for October 30, 2026.
The Federal Ministry of Finance is the borrower, while the Federal Ministry of Budget and Economic Planning is expected to implement the programme.
The project would cover all 36 states and the FCT and seek to improve access to an integrated package of health, nutrition, early learning, childcare, water and sanitation, and other services for children aged zero to five.
It would be financed through $500m IDA credit, consisting of a $400m programme-for-results component and $100m investment project financing component.
The World Bank said the intervention had become necessary because “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 organised early learning,” with poor rural households carrying much of the burden.
Debt jumps
The proposed borrowing comes as fresh figures from the Debt Management Office show that Nigeria’s total public debt rose by N14.39tn within one year, from N152.40tn in June 2025 to N166.79tn at the end of June 2026.
That represented an increase of 9.44 per cent year-on-year. Measured in dollars, however, the expansion was considerably larger. Public debt jumped by $21.27bn, or 21.35 per cent, from $99.66bn to $120.93bn over the same period.
The divergence reflects, among other factors, the stronger naira used in valuing the June 2026 external debt. The DMO applied an official exchange rate of N1,379.1842/$ in June 2026 compared with N1,529.2105/$ a year earlier. Consequently, dollar-denominated debt rose much faster than its naira equivalent.
On a quarterly basis, the debt stock increased by N7.44tn, or 4.67 per cent, from N159.35tn in March 2026 to N166.79tn in June.
In dollar terms, it rose by $5.98bn, or 5.20 per cent, from $114.95bn at the end of March. The June figures show that domestic liabilities remained the larger component of the debt portfolio.
