Economy
World Bank to Approve $1bn Development Loan to Nigeria December 16
By Adedapo Adesanya
The World Bank has fixed December 16 as a tentative approval date for a fresh $1 billion Development Policy Financing loan to Nigeria.
If approved, the funds will be disbursed in two tranches as policy milestones are achieved, with implementation overseen by the Federal Ministry of Finance in collaboration with the Central Bank of Nigeria (CBN) and relevant line ministries.
The initiative is expected to anchor Nigeria’s transition from short-term stabilisation to long-term, inclusive growth, potentially marking one of the largest World Bank policy support operations for the country in recent years.
The loan is under a new initiative tagged Nigeria Actions for Investment and Jobs Acceleration (P512892), according to a project document published by the bank on October 27.
The new facility comprises a $500 million International Development Association credit and a $500 million International Bank for Reconstruction and Development loan.
The loan, which falls under the bank’s Macroeconomics, Trade and Investment practice area for the Western and Central Africa region, is designed to strengthen ongoing economic reforms, promote job creation, and accelerate private investment.
The credit facility is part of the bank’s broader support package aimed at consolidating the country’s post-reform stability and driving inclusive growth across key sectors of the economy.
“The proposed Development Policy Financing supports Nigeria’s pivot from stabilisation to inclusive growth and job creation. Structured as a two-tranche standalone operation of $1.0 billion ($500m IDA credit and $500m IBRD loan), it seeks to catalyse private sector–led investment by expanding access to credit, deepening capital markets and digital services, easing inflationary pressures, and promoting export diversification,” the document read.
Nigeria under President Bola Tinubu has embarked on many economic reforms, including the removal of the petrol subsidy, unification of exchange rates, and an end to central bank deficit financing.
According to the federal government, the measures, championed under President Bola Tinubu’s Renewed Hope Agenda, have helped stabilise the economy, narrow the fiscal deficit, and restore investor confidence.
The World Bank report noted that while macroeconomic stability has returned, “Nigeria’s economy has yet to shift decisively into a higher and inclusive growth path,” underscoring the urgency of new investment to spur productivity, diversify exports, and create jobs.
The new policy loan is structured around two key pillars: unlocking private sector growth and lowering the cost of doing business, while expanding opportunities across agriculture, trade, and digital services.
Under the first pillar, the facility will expand access to financial credit and digital inclusion, with backing for the investment and Securities Act 2025, new credit enhancement facilities, and a CBN Rulebook aimed at improving microfinance and non-bank financial institutions.
It also supports the National Digital Economy and E-Governance Bill 2025, which will provide a legal framework for electronic transactions, authentication services, and digital records, key steps toward building a modern, paperless government system.
The second pillar seeks to lower costs for firms and households, reduce inflationary pressures, and enhance export competitiveness.
The bank’s report highlights plans to simplify trade barriers, adopt AfCFTA tariff concessions, and improve certified seed systems for key crops like rice, maize, and soybeans.
This is expected to raise productivity, boost food security, and attract new private investment into the agricultural value chain.
According to the document, the $1 billion DPF loan forms part of a broader FY2026 package of World Bank interventions supporting Nigeria’s growth agenda.
Other complementary projects include FINCLUDE (to improve MSME financing), BRIDGE (digital infrastructure), and AGROW (agricultural value chain growth). Together, these are expected to crowd in private capital, expand access to finance, and create an enabling environment for small and medium-scale enterprises.
The programme also aligns with the Paris Climate Agreement, with components targeting climate-resilient agriculture, reduced deforestation, and digital governance systems that lower emissions from paper-based processes.
The Bretton Woods institution estimates that the policy reforms supported under this operation will help reduce food inflation, increase seed productivity, and expand digital exports, while creating millions of direct and indirect jobs. It added that improved access to credit, particularly for MSMEs and smallholder farmers, will translate to “expanded economic opportunities by creating jobs, including for the poor.”
In addition, reduced import bans and lower tariffs on key inputs are expected to make goods cheaper and improve consumer welfare, while also boosting Nigeria’s competitiveness in regional markets.
By Adedapo Adesanya
The United Kingdom via the British High Commission in Abuja has launched two flagship economic reform programmes – the Nigeria Economic Stability & Transformation (NEST) programme and the Nigeria Public Finance Facility (NPFF) -as part of efforts to support Nigeria’s economic reform and growth agenda.
Backed by a £12.4 million UK investment, NEST and NPFF sit at the centre of the UK-Nigeria mutual growth partnership and support Nigeria’s efforts to strengthen macroeconomic stability, improve fiscal resilience, and create a more competitive environment for investment and private-sector growth.
Speaking at the launch, Cynthia Rowe, Head of Development Cooperation at the British High Commission in Abuja, said, “These two programmes sit at the heart of our economic development cooperation with Nigeria. They reflect a shared commitment to strengthening the fundamentals that matter most for our stability, confidence, and long-term growth.”
The launch followed the inaugural meeting of the Joint UK-Nigeria Steering Committee, which endorsed the approach of both programmes and confirmed strong alignment between the UK and Nigeria on priority areas for delivery.
Representing the Government of Nigeria, Special Adviser to the President of Nigeria on Finance and the Economy, Mrs Sanyade Okoli, welcomed the collaboration, touting it as crucial to current, critical reforms.
“We welcome the United Kingdom’s support through these new programmes as a strong demonstration of our shared commitment to Nigeria’s economic stability and long-term prosperity. At a time when we are implementing critical reforms to strengthen fiscal resilience, improve macroeconomic stability, and unlock inclusive growth, this partnership will provide valuable technical support. Together, we are laying the foundation for a more resilient economy that delivers sustainable development and improved livelihoods for all Nigerians.”
On his part, Mr Jonny Baxter, British Deputy High Commissioner in Lagos, highlighted the significance of the programmes within the wider UK-Nigeria mutual growth partnership.
“NEST and NPFF are central to our shared approach to strengthening the foundations that underpin long-term economic prosperity. They sit firmly within the UK-Nigeria mutual growth partnership.”
By Aduragbemi Omiyale
A strategic partnership aimed at accelerating the growth, digital capacity, and sustainability of Nigeria’s 40 million Micro, Small and Medium Enterprises (MSMEs) has been signed by MTN Nigeria and the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN).
The collaboration will feature joint initiatives focused on digital inclusion, financial access, capacity building, and providing verified information for MSMEs.
With millions of small businesses depending on accurate guidance and easy-to-access support, MTN and SMEDAN say their shared platform will address gaps in communication, misinformation, and access to opportunities.
At the formal signing of the Memorandum of Understanding (MoU) on Thursday, November 27, 2025, in Lagos, the stage was set for the immediate roll-out of tools, content, and resources that will support MSMEs nationwide.
The chief operating officer of MTN Nigeria, Mr Ayham Moussa, reiterated the company’s commitment to supporting Nigeria’s economic development, stating that MSMEs are the lifeline of Nigeria’s economy.
“SMEs are the backbone of the economy and the backbone of employment in Nigeria. We are delighted to power SMEDAN’s platform and provide tools that help MSMEs reach customers, obtain funding, and access wider markets. This collaboration serves both our business and social development objectives,” he stated.
Also, the Chief Enterprise Business Officer of MTN Nigeria, Ms Lynda Saint-Nwafor, described the MoU as a tool to “meet SMEs at the point of their needs,” noting that nano, micro, small, and medium businesses each require different resources to scale.
“Some SMEs need guidance, some need resources; others need opportunities or workforce support. This platform allows them to access whatever they need. We are committed to identifying opportunities across financial inclusion, digital inclusion, and capacity building that help SMEs to scale,” she noted.
Also commenting, the Director General of SMEDAN, Mr Charles Odii, emphasised the significance of the collaboration, noting that the agency cannot meet its mandate without leveraging technology and private-sector expertise.
“We have approximately 40 million MSMEs in Nigeria, and only about 400 SMEDAN staff. We cannot fulfil our mandate without technology, data, and strong partners.
“MTN already has the infrastructure and tools to support MSMEs from payments to identity, hosting, learning, and more. With this partnership, we are confident we can achieve in a short time what would have taken years,” he disclosed.
Mr Odii highlighted that the SMEDAN-MTN collaboration would support businesses across their growth needs, guided by their four-point GROW model – Guidance, Resources, Opportunities, and Workforce Development.
He added that SMEDAN has already created over 100,000 jobs within its two-year administration and expects the partnership to significantly boost job creation, business expansion, and nationwide enterprise modernisation.
By Adedapo Adesanya
The Nigerian Exchange (NGX) Limited is seeking review of the controversial Capital Gains Tax increase, fearing it will chase away foreign investors from the country’s capital market.
Nigeria’s new tax regime, which takes effect from January 1, 2026, represents one of the most significant changes to Nigeria’s tax system in recent years.
Under the new rules, the flat 10 per cent Capital Gains Tax rate has been replaced by progressive income tax rates ranging from zero to 30 per cent, depending on an investor’s overall income or profit level while large corporate investors will see the top rate reduced to 25 per cent as part of a wider corporate tax reform.
The chief executive of NGX, Mr Jude Chiemeka, said in a Bloomberg interview in Kigali, Rwanda that there should be a “removal of the capital gains tax completely, or perhaps deferring it for five years.”
According to him, Nigeria, having a higher Capital Gains Tax, will make investors redirect asset allocation to frontier markets and “countries that have less tax.”
“From a capital flow perspective, we should be concerned because all these international portfolio managers that invest across frontier markets will certainly go to where the cost of investing is not so burdensome,” the CEO said, as per Bloomberg. “That is really the angle one will look at it from.”
Meanwhile, the policy has been defended by the chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Mr Taiwo Oyedele, who noted that the new tax will make investing in the capital market more attractive by reducing risks, promoting fairness, and simplifying compliance.
He noted that the framework allows investors to deduct legitimate costs such as brokerage fees, regulatory charges, realised capital losses, margin interest, and foreign exchange losses directly tied to investments, thereby ensuring that they are not taxed when operating at a loss.
Mr Oyedele also said the reforms introduced a more inclusive approach to taxation by exempting several categories of investors and transactions.
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