FG Rules Out Fresh $800m Loan From World Bank

FG Rules Out Fresh $800m Loan From World Bank

The federal government has clarified that it was not seeking another $800 million loan from the World Bank to cushion the impact of the impending removal of petroleum subsidy on vulnerable Nigerians.

The Minister of Finance, Budget and National Planning, Zainab Ahmed who gave the clarification in a statement yesterday, said her attention had been drawn to reports suggesting that the federal government was seeking new loans to cushion the effect of the pending fuel subsidy removal, describing the news reports as incorrect.

Last Thursday’s letter by President Muhammadu Buhari requesting “the Senate to kindly approve an ‘additional’ loan facility to the tune of $8OO million to be secured from the World Bank for the National Social Safety Net Programme” had triggered outrage from many Nigerians who interpreted the request to mean a fresh $800 million, different from the one that had been reportedly secured by the administration.

The finance minister had at the end of the Federal Executive Council (FEC) meeting on April 5, 2023, announced that Nigeria had already secured $800 million from the World Bank to help provide palliatives to about 50 million poor Nigerians in the aftermath of fuel subsidy removal.

However, in a statement captioned “Nigeria Seeks No New World Bank Loan-Ahmed,” and issued by her Special Adviser, Media, and Communications, Yunusa Tanko Abdullahi, the minister said the $800 million in question was the same one secured from the World Bank recently.”

According to the statement, “The news story is not correct. This is the same loan that the Honourable Minister had explained on several occasions that the $800 million facility the country recently got from the World Bank for post-petrol subsidy removal palliative was awaiting parliamentary approval for the federal government to commence disbursement.

“The government is therefore not seeking another loan for the pending fuel subsidy removal. It is the same.

“It will be recalled that the facility would be deployed to provide succor to 10 million households, who are expected to get N5,000 each for six months.

“The minister had explained that the initial duration of the palliatives meant to cushion the effects of the planned subsidy removal on vulnerable Nigerians was for six months, but would be reviewed upon extensive consultation with stakeholders.”

The statement further quoted the minister as having recently explained that “the $800 million has been negotiated and approved by the Federal Executive Council (FEC) and we now have a request before the parliament for approval. And once the parliament approves it, the next administration can decide on the utilisation.

“We’ve also been doing preparatory work side by side along the approval process. This includes expanding the committee to include members of the transition team of the President-elect.

“The process will include the verification of the social register which will be used for electronic transfers of the funds.”

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