In a bid to help address the country’s economic crisis, the two-tranche financial support of $1.5 billion each is coming to Nigeria from the World Bank.
The lifeline from the World Bank would be coming notwithstanding the fact that Nigeria is still yet to wrap up to its conclusion prescribed World Bank reforms in the country’s foreign exchange handlings.
Recall that this draw back on the part of Nigeria had made the World Bank to issue threats of barring Nigeria from accessing the funds amounting to an overall total of $1.5 billion.
The first tranche of an initial $1.5 billion is coming from the International Development Association (IDA) credit to the tune of $750million for the Nigeria Covid-19 Action Recovery and Economic Stimulus – Program for Results (Nigeria CARES).
The World Bank said on Tuesday: “This program will help increase access to social transfers and basic services, as well as provide grants to poor and vulnerable households. It will also strengthen food supply chains for poor households while facilitating recovery and enhancing capabilities of MSMEs. This is financed through.
“The second is another International Development Association (IDA) credit of $750 million for State Fiscal Transparency, Accountability and Sustainability Program for Results (SFTAS), which is meant to build on the progress made across 36 States, the original SFTAS program will be expanded and scaled up in response to COVID-19”.
The statement added: “The Additional Financing will help meet the financing gap in the Programme Expenditure Framework, due to the sharp reduction in government revenues associated with the crisis.
“It will also help increase the efficiency in spending, strengthen revenue mobilization, and enhance accountability and transparency in public resource management to further strengthen state-level COVID-19 response,” the statement said.
The World Bank Group (WBG) also approved a different $1.5-billion package, social protection and strengthening of state-level COVID-19 response, for Nigeria to help build a resilient recovery post-COVID19, which is a new five-year Country Partnership Framework (CPF) to last from 2021 to 2024.
Prepared jointly with the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA), this initiative known as CPF seeks a collaborative approach of how resources across the entire World Bank Group can best be deployed to support Government’s effort to achieve its goal to lift 100 million citizens out of poverty.
Shubham Chaudhuri, World Bank Country Director for Nigeria stated that “this Country Partnership Framework will guide our engagement for the next five years in supporting the Government of Nigeria’s strategic priorities by taking a phased and adaptive approach. To realise its long-term potential, Nigeria has to make tangible progress on key challenges and pursue some bold reforms.”
The World Bank Group, he noted “will focus on supporting Nigeria’s efforts to reduce poverty and promote sustained private sector-led growth.”
According to him, the CPF will focus on four areas of engagement. These are: investing in human capital by increasing access to basic education, quality water and sanitation services; improving primary healthcare; and increasing the coverage and effectiveness of social assistance programs.
“Additional investments in promoting women’s empowerment and youth employment and skills, especially for young women, will also help reduce maternal and child mortality,” the Bank said.
Another area of focus the $1.5 billion will spent on will be to promote jobs and economic transformation and diversification “by supporting measures to unlock private investment and job creation and increasing access to reliable and sustainable power for households and firms. The CPF will also focus on boosting digital infrastructure, and developing economic corridors and smart cities, to provide Nigerians with improved livelihoods.
He explained further: “Enhancing resilience by strengthening service delivery and livelihood opportunities in the Northeast and other regions grappling with insecurity, as well as modernizing agriculture and building climate resilience. Will also receive attention from the CPF fund.
“The last area of focus will to strengthen the foundations of the public sector “by improving public financial management and strengthening the social contract between citizens and government through improved fiscal and debt management.”
Similarly, Kevin Njiraini, International Finance Corporation (IFC) Director for Southern Africa and Nigeria said “a strong private sector is critical to support Nigeria’s economic growth and development. The Country Partnership Framework leverages the World Bank Group to enable business growth that is inclusive and sustainable.”
He added: “IFC will continue to support a broader private sector-led growth strategy to help Nigeria realize its immense potential by attracting more investment and creating millions of quality jobs for its growing population.”
Merli Baroudi, Director at MIGA for Economics and Sustainability noted that “to achieve sustainable post-COVID economic recovery, Nigeria needs to strengthen reforms that support private sector solutions and crowd in private sector finance”.
Baroudi further stated that “in close coordination with the World Bank and IFC, MIGA will continue to expand its support for cross-border private investment into Nigeria.”
The World Bank reiterated that “Nigeria is at a critical juncture. With the sharp fall in oil prices as a result of COVID-19, the economy is projected to contract by over 4% in 2020, plunging the country into its deepest recession since the 1980s.”
