During the initial four months of President Bola Tinubu's administration, Nigeria secured a total of $1.95 billion in loans from the World Bank, despite concerns about the country's growing debt burden. These loans were allocated for various purposes: $700 million for education, $750 million for power, and $500 million for women's empowerment, as reported by BusinessDay.
Many Nigerians are increasingly skeptical about the government's borrowing practices, given the longstanding issues of infrastructure decay and rising unemployment. They question how effectively these borrowed funds are utilized, considering the persistent problems like unreliable electricity supply and the widespread reliance on generators.
Femi Adelana, a business analyst, pointed out that despite budget allocations and foreign loans, millions of Nigerians remain out of school, as indicated by a 2022 UNESCO report. This skepticism and concern about the government's borrowing habits are shared by many Nigerians.
Economists interviewed by BusinessDay emphasized that borrowing can be justifiable if the funds are invested in infrastructure projects that yield economic returns and improve people's lives. However, they argue that this has not been the case in Nigeria, where previous loans haven't translated into meaningful improvements.
As of June 2023, data from the Debt Management Office showed that Nigeria's federal government had an external debt of $38.8 billion. Within the first months of President Tinubu's term, Nigeria secured three major World Bank loans, totaling $1.95 billion.
These loans included a $750 million loan for power projects, aimed at addressing Nigeria's significant electricity access deficit. Additionally, there was a $500 million loan for women's empowerment and a $700 million loan to enhance educational opportunities for adolescent girls, given the educational challenges in the country.
The World Bank stressed the urgent need to improve electricity access, as 45 percent of Nigeria's population, or 90 million people, lack access to the electricity grid, making Nigeria a global leader in this deficit.
The loans for women's empowerment and education aim to uplift the livelihoods and educational prospects of Nigerian women and adolescent girls, targeting specific states with significant needs.