The Federal Government is in discussions with the World Bank over three proposed financing facilities worth a combined $1.5 billion, even as Nigeria’s total public debt rises to a record ₦166.79 trillion.

Documents from the World Bank indicate that the proposed facilities are valued at $500 million each and are targeted at climate resilience, social protection and early childhood development.

The proposed borrowing comes against the backdrop of a significant increase in Nigeria’s debt stock. Data from the Debt Management Office showed that total public debt rose by ₦7.44 trillion, or 4.67 per cent, between March and June 2026.

Compared with the ₦152.40 trillion recorded in June 2025, the latest figure represents a ₦14.39 trillion increase, equivalent to 9.44 per cent.

Three World Bank Facilities Proposed

One of the proposed loans is an additional $500 million for the Agro-Climatic Resilience in Semi-Arid Landscapes project, popularly known as ACReSAL.

The additional funding would increase the project’s total financing from $700 million to $1.2 billion. It is expected to support environmental restoration, watershed rehabilitation, flood and erosion control, irrigation, water storage and reforestation across 19 northern states and the Federal Capital Territory.

The World Bank has scheduled October 29, 2026, for consideration of the additional ACReSAL financing.

A second $500 million facility is being proposed under the Household Prosperity and Empowerment-Social Protection Project, or HOPE-SP.

The programme is designed to strengthen social protection systems, expand assistance to vulnerable households and improve the delivery of social programmes through federal, state and local government structures.

The third proposed facility, also worth $500 million, would finance a Nigeria Early Childhood Development programme.

The initiative is expected to cover all 36 states and the FCT, with interventions focused on early childhood health, nutrition, learning, childcare, water and sanitation for children from birth to five years.

The HOPE-SP and early childhood development facilities are currently expected to go before the World Bank board in March 2027.

Domestic Debt Remains Dominant

Nigeria’s latest debt figures show that domestic borrowing continues to account for the larger portion of the country’s total debt.

Domestic debt stood at ₦91.59 trillion as of June 2026, representing 54.91 per cent of the total, while external debt stood at ₦75.20 trillion.

The Federal Government alone accounted for ₦152.77 trillion of the overall debt stock.

Treasury bills were among the fastest-growing components of domestic borrowing. Outstanding Nigerian Treasury Bills increased from ₦12.76 trillion in June 2025 to ₦19.48 trillion a year later, representing a 52.64 per cent rise.

FGN bonds remained the largest component of Federal Government domestic debt, standing at ₦64.84 trillion.

World Bank Exposure Rises

Nigeria’s financial obligations to the World Bank Group have also increased.

World Bank data put Nigeria’s exposure to the institution at about $20.98 billion as of June 2026, comprising approximately $19.14 billion in International Development Association (IDA) exposure and $1.84 billion through the International Bank for Reconstruction and Development (IBRD).

The proposed new facilities would therefore add to Nigeria’s existing obligations to the multilateral lender.

However, the financing is being directed towards specific development programmes rather than general budget support, with projects covering environmental resilience, social protection and early childhood development.

Focus Shifts to Use of Borrowed Funds

The proposed borrowing has renewed attention on how Nigeria manages its growing debt portfolio.

Economist Adewale Abimbola noted that the key consideration is not simply whether the country borrows, but how effectively the funds are deployed.

The proposed World Bank facilities could provide financing for development programmes, but their long-term value will depend on implementation, transparency and whether the projects deliver measurable economic and social benefits.

With Nigeria’s public debt already at ₦166.79 trillion, the new borrowing proposals are likely to keep debt sustainability and the effectiveness of government spending firmly on the economic agenda.

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