World Bank’s Nigeria portfolio surges 45% to $17.5bn in four years

…as bank warns that reverting to FX and monetary reforms will deepen Nigeria’s poverty trap

The World Bank’s financial commitment to Nigeria surged by 45.8 per cent over the last four years, with its total portfolio climbing from $12 billion in 2021 to $17.5 billion in 2025.

This expansion, driven by the bank’s Country Partnership Framework (CPF) period, underscores the scaling up of development assistance aimed at addressing critical infrastructure deficits, human capital development, and macroeconomic stability across the country.

The Bank, in its recent ‘completion and learning review of the Country Partnership Framework (CPF) for Nigeria’, said that new lending in the 2021-2025 period totalled $12.1 billion, of which $9.2 billion was in International Development Association (IDA) and $2.9billion in International Bank for Reconstruction and Development (IBRD).

“The CPF period saw a substantial expansion of the World Bank’s portfolio in Nigeria, which increased from US$12billion in FY21 to US$17.5 billion in FY25,” the bank stated.

To successfully implement the CPF and achieve results at scale in a complex environment, the Bank said it made a concerted effort to reduce the number and increase the size of operations; proactively address disbursement bottlenecks; build subnational implementation capacity; and institute a systematic and more regular approach to portfolio monitoring and review.

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“These efforts contributed to a robust implementation of the portfolio, with disbursement ratios increasing from 8.6 per cent in FY21 to an average of over 20 per cent in
FY22-25.

“Moreover, average project size increased from US$415million at the start of the CPF period to over FY22-25, with the number of projects reduced from 36 at the inception of the CPF to 30 in FY25,” it added.

The bank also said that aligning with the CPF’s goal of fostering jobs and economic transformation, the International Finance Corporation (IFC) committed portfolio in Nigeria stood at $1.6 billion spread over 37 clients by April 2025, representing the third largest portfolio in Africa.

It stated that since 2021, IFC has provided strong countercyclical support, including in response to the pandemic, with long-term finance commitments totalling close to $4.7 billion over the last 5 years in own account ($1.7billion) and mobilisation ($2.9billion).

IFC investments primarily focused on the financial services sector, with a particular emphasis on women-owned enterprises and climate financing.

The bank explained that IFC has also introduced innovative capital markets solutions among other notable investments, in manufacturing, agribusiness, and services sectors, accounting for 43 per cent of IFC committed exposure, as well as infrastructure.

“On the advisory front, IFC has sought to strengthen institutional capacities in digital financial services, SME lending, risk management, access to microfinance, and technical assistance to the CBN. IFC has also supported agribusiness and manufacturing to enhance food security, meet domestic needs, and grow exports in the country while expanding energy toward universal access and green energy.

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“The WBG Guarantee Platform (WBG-GP) has a total portfolio of US$600m in Nigeria across diverse sectors of the economy. MIGA’s US$335million in exposure supports investments in the Azura-Edo Independent Power Project alongside the WB and IFC, as well as capital optimisation, glass manufacturing, hospitality, and a portfolio of commercial distributed renewable energy electrification projects aimed at providing reliable and affordable power to industrial customers.

“The latest MIGA projects in Nigeria are the Konexa C&I Project (FY24) and the CrossBoundary Energy C&I Project (FY25), both providing distributed renewable energy solutions to commercial and industrial customers in Nigeria, which reduce reliance on diesel generation and support the competitiveness of the industrial sectors.

“IBRD/IDA guarantee exposure of US$256million is in the form of payment and loan guarantees to the Azura-Edo Project. IFC risk-sharing facilities under the platform totaling US$9.2million support SME and agribusiness lending by the local banking sector.

“Moving forward, WBG-GP sees opportunities to expand support for distributed renewable energy in the context of the DARES initiative and Mission300, as well as to support the financial sector through trade finance and other instruments.”

The World Bank also warned that any reversal of Nigeria’s recent monetary and foreign exchange policy reforms could lock millions more citizens into a cycle of severe economic hardship.

In its recent ‘completion and learning review of the Country Partnership Framework (CFP) for Nigeria ‘, the bank emphasised that maintaining the current policy trajectory, despite the immediate pains, is non-negotiable if Africa’s largest economy is to successfully tackle its poverty trap and achieve long-term stability.

According to the Bank, in a large country such as Nigeria, private sector-driven economic growth and job creation are necessary conditions to achieve poverty reduction and development impact at the country level.

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“Though the strong engagement approach underpinning WBG support was instrumental to the achievement of CPF objectives, poor economic performance led to an increase in Nigeria’s poverty rate during the CPF period and several key human capital indicators stagnated despite substantial development support.

“Thus, safeguarding and deepening the country’s recent reforms to reignite growth will be essential for the majority of Nigerians to escape the poverty trap. Specifically, efforts will be required to: avoid reversals on recent monetary and exchange rate policy reforms; continue to strengthen oil and non-oil revenues,” the Bank said.

It also stressed the need for the Nigerian government to foster job creation by improving access to finance, strengthening the business environment, and supporting sectors with high development potential such as agribusiness, as well as increasing quality spending on human capital and physical and digital infrastructure.