Undisbursed loans may drive Nigeria’s debt to the World Bank from $12.72bn to $21.15bn.
This shows that the yet-to-be disbursed loans can increase Nigeria’s debt to the lending institution by 66.27 per cent.
The audited financial statements of the World Bank for the fiscal year 2022 showed that the bank was yet to disburse about $8.12bn to Nigeria as of June 30, 2022.
A breakdown further showed that the undisbursed loans included $7.60bn from the International Development Association, IDA, and $514m from the International Bank for Reconstruction and Development, IBRD.
These undisbursed loans encompass loans approved but not signed as well as the signed loan commitments.
Explaining the reason for the yet-to-be disbursed loans, particularly the signed loan commitments, the bank said that these “loans are not effective and disbursements do not start until the borrowers and/or guarantors take certain actions and furnish documents.”
Undisbursed Loans Raise Nigeria’s World Bank Debt To $21.15bn
The IBRD and the IDA, which make up the World Bank, have, over the years, advanced loans to Nigeria.
The IBRD lends to governments of middle-income and creditworthy low-income countries, while the IDA provides concessionary loans – called credits – and grants to governments of the poorest countries.
The Debt Management Office had disclosed that Nigeria’s debt to the Washington-based bank was $12.72bn as of March 31, 2022.
A breakdown showed that Nigeria borrowed $12.23bn from the IDA and $486.10m from the IBRD.
In an earlier report, it was disclosed that Nigeria owed the World Bank $13.04bn as of June 30, 2022.
According to the report, the total debt owed to the World Bank by Nigeria rose by $660m in the first six months of 2022.
Nigeria’s debt to the IDA and IBRD stood at $12.55bn and $486m respectively as of June 30, 2022, compared to $11.97bn and $410.60m in December 32, 2021.