The Federal Government of Nigeria has initiated discussions with the World Bank to secure three loans amounting to $1.5 billion. This move comes as the country grapples with a record public debt, which has surged to N166.79 trillion as of June 2026.

The proposed financing includes three separate loans of $500 million each, aimed at enhancing climate resilience, social protection, and early childhood development initiatives across Nigeria. The most immediate of these is an additional $500 million for the Agro-Climatic Resilience in Semi-Arid Landscapes project (ACReSAL). The World Bank is expected to review this proposal on October 29, 2026.

ACReSAL, which is currently funded at $700 million, aims to address critical issues such as land degradation, water insecurity, and climate vulnerability. The additional financing would increase the project’s budget to $1.2 billion, focusing on landscape restoration, watershed rehabilitation, and other climate-resilient interventions. The Federal Ministry of Environment is set to implement this project, which operates in 19 northern states and the Federal Capital Territory.

In addition to the ACReSAL funding, the government is also seeking another $500 million for the Household Prosperity and Empowerment-Social Protection Project (HOPE-SP). This project, still in its preparatory phase, aims to establish sustainable social assistance for vulnerable households. The World Bank has scheduled a technical design review for October 30, 2026, with a tentative approval date of March 16, 2027.

The third proposed loan, also for $500 million, targets early childhood development and is expected to cover all 36 states and the Federal Capital Territory. This initiative aims to improve access to essential services for children aged zero to five, including health, nutrition, and early learning. The approval for this project is anticipated on March 15, 2027.

These proposed loans come at a time when Nigeria's public debt has increased significantly, rising by N14.39 trillion within a year. The Debt Management Office reported that the total public debt grew from N152.40 trillion in June 2025 to N166.79 trillion in June 2026, marking a 9.44% year-on-year increase. In dollar terms, the public debt surged from $99.66 billion to $120.93 billion, reflecting a 21.35% increase.

The World Bank's involvement is crucial, as Nigeria's outstanding debt to the institution reached $20.73 billion by the end of June 2026, accounting for approximately 38% of the country’s total external debt. This growing reliance on multilateral institutions highlights the urgent need for effective debt management and utilization of funds to foster sustainable economic growth.

Amid these developments, former Vice-President Atiku Abubakar has called for a comprehensive reconciliation of Nigeria's public debt, questioning the government's borrowing practices and the impact on citizens' welfare. He emphasized the need for transparency regarding the rising debt levels and the effectiveness of the government's economic policies.

Economist Adewale Abimbola commented on the significance of these loans, noting that if structured properly and tied to viable projects, borrowing could be beneficial for Nigeria's economic landscape. He stressed that the focus should be on how effectively these funds are utilized to stimulate growth and improve public services.