The $3 billion World Bank loan recently obtained by the federal government would be remitted to the country in four tranches of $750 million each.
The first tranche of this loan, which would be used to plug the funding gaps and tarriff differentials in the transmission segment of the electricity value chain, according to the Minister of Finance, Zainab Ahmed is due in April next year.
Accordingly, subsequent tranches would be remitted to the federal government according to a timeline.
The federal government had proposed the loan be remitted in two tranches of $1.5 billion each. The proposal did not get the approval of the World Bank.
The finance minister who revealed this at the end of the recently concluded annual meeting of the World Bank/International Monetary Fund in Washington DC had explained that the purpose for obtaining the loan was to plug funding gaps and tariff differentials which has become a bottleneck in the country while, part of the money would be channeled into the transmission segment of the electricity value chain.
Also Read Nigeria to get $2.5B World Bank Loan
The Minister also hinted that the federal government had proposed a $4 billion loan facility.
Her word, “If the government is able to expand the facility to $4 billion, the additional $1 billion would be used for the distribution segment.
“It will help us to exit the subsidy that is now inherent in the power sector,’’ she added.
NIGERIA’S LOAN PORTFOLIO WITH WORLD BANK
According to data derived from the Debt Management Office, it is estimated that Nigeria loan exposure with the World Bank now stands at $81.67Bn (N24.947 Trillion), as at March 31,2019, which means the country’s debt portfolio is on the increase.
Also , the country’s external debt as at December 31,2018 , was capped at $25.27 Billion, making the nation highly indebted to World Bank, which has made the country the single largest creditor as the bank holds 34.32 per cent of her external debt commitment.