Nigeria has risen to become the third-largest debtor to the World Bank’s International Development Association (IDA), under chief Bola Ahmed Tinubu, with the country’s debt reaching $16.5 billion as of June 30, 2024.
According to the World Bank’s latest financial disclosures, Nigeria’s debt exposure to the IDA has witnessed a substantial 14.4% increase, escalating from $14.3 billion in the fiscal year 2023 to $16.5 billion in FY2024.
This marks a $2.2 billion increase from the previous fiscal year, where Nigeria held $14.3 billion in IDA debt, positioning it as the fourth-largest borrower at the time.
The significant rise in borrowing reflects Nigeria’s ongoing efforts to tackle economic challenges, including infrastructure development, poverty alleviation, and social investment programs. However, the increase also raises concerns about the sustainability of the nation’s growing debt burden.
The Tinubu administration, which assumed office in May 2023, has been actively securing international funding to support its ambitious economic and social reform agenda. In the fiscal year 2024, Nigeria received at least $2.2 billion from the World Bank, further underlining the country’s dependence on international financial aid amid domestic economic difficulties.
Compared to other major IDA debtors, Bangladesh remains the largest borrower, with its debt rising from $19.3 billion in 2023 to $20.5 billion in 2024. Pakistan holds the second position with a stable debt of $17.9 billion during the same period.
India, previously the third-largest borrower with $17.9 billion in 2023, saw its IDA debt decrease to $15.9 billion in 2024, allowing Nigeria to move ahead.
Other IDA borrowers include Ethiopia, which saw its debt increase from $11.6 billion in 2023 to $12.2 billion in 2024.
Kenya and Vietnam each have debts of $12.0 billion. Along with Tanzania, Ghana, and Uganda, these countries make up the top ten IDA debtors, collectively accounting for 63% of the IDA’s total exposure as of June 30, 2024.
As of March 31, 2024, Nigeria’s total debt to the World Bank, including all loans, stood at $15.59 billion, according to the Debt Management Office (DMO).
Despite concerns over rising external debt servicing costs, the World Bank may approve an additional four loan projects for Nigeria this year, potentially adding $2 billion to the country’s debt portfolio.
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