The Tinubu-led federal government has disclosed plans to secure a fresh $1.5 billion loan facility from the World Bank as part of efforts to address the fiscal gap in the 2023 budget.
The Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, confirmed this development during a press briefing at the ongoing 2023 Annual Meetings of the World Bank and the International Monetary Fund (IMF) in Marrakech.
Edun explained that the loan would be interest-free and is expected to be disbursed soon. “The World Bank is the number one multilateral development bank helping developing countries or funding developing countries, projects and programmes, and sectors,” he said.
He further added that Nigeria qualifies for some concessionary International Development Association (IDA) funding, which means that effectively the interest rate will be zero.
Edun, who also confirmed his emergence as the chair of the Africa Group 1 constituency and leader of all African nations in the executives of the IMF, pointed out that Nigeria has become almost number one on people’s list when they want to look at where to invest.
“Nigeria is definitely on the right path; we have taken the right decision for the economy to recover and for it to attract Foreign Direct Investment (FDI) and as well, I will add, domestic investment to recover full economic growth, job creation and at the same time, achieve inclusivity of women and young people,” he added.
The minister assured that the federal government was taking steps towards cutting down its expenditure. “We’ve talked about tax reform, and that tax reform will include looking at expenditures on taxes, waivers, duties, and tax exemptions. So, that is very much part of the plan,” he added.
According to Edun, a newly constituted fiscal policy and tax reform committee was recently inaugurated by the federal government with a focus on domestic revenue mobilisation.
Commenting on Ways and Means, which was a major challenge for the immediate past administration, Edun said: “Regarding Ways and Means, President Bola Ahmed Tinubu had even while campaigning as a candidate, President-elect and President has a commitment not to go beyond the statutory limits.”
“One of his priorities is the rule of law – sticking to agreements, sticking to the law. And so, his commitment is to come within the limit for Ways and Means,” Edun said.