Nigeria Becomes World Bank’s IDA Third-largest Debtor, Owes $16.5 Billion

Nigeria Becomes Third-Largest Debtor to World Bank’s IDA

As of June 30, 2024, Nigeria has become the third-largest debtor to the World Bank’s International Development Association (IDA), following a substantial rise in its borrowing from the institution.

A financial statement dated June 30, 2024, which was recently released and obtained by our correspondent, reveals this development. The IDA, a key arm of the World Bank, offers concessional loans and grants to the world’s poorest countries.

These loans feature low interest rates and extended repayment periods, aiming to boost economic growth, reduce inequalities, and improve living conditions in developing nations.

According to the World Bank’s latest financial statements, Nigeria’s debt to the IDA increased by 14.4 percent, rising from $14.3 billion in the fiscal year 2023 to $16.5 billion in 2024. This $2.2 billion increase marks Nigeria’s debut among the top three IDA debtors, moving up from its previous position as the fourth-largest borrower in 2023.

During the fiscal year from July 2023 to June 2024, Nigeria secured at least $2.2 billion in new loans from the IDA under President Bola Tinubu’s administration. This figure does not include outstanding loans from the World Bank’s International Bank for Reconstruction and Development (IBRD), which operates separately from the IDA.

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Bangladesh remains the largest IDA debtor, with its exposure rising from $19.3 billion in 2023 to $20.5 billion in 2024. Pakistan holds the second position with a stable exposure of $17.9 billion.

India, which was the third-largest borrower in 2023 with $17.9 billion, saw its IDA exposure decrease to $15.9 billion in 2024, allowing Nigeria to surpass it.

Other notable IDA borrowers include Ethiopia, with its debt increasing from $11.6 billion in 2023 to $12.2 billion in 2024, and Kenya and Vietnam, both with $12.0 billion in exposure this year. Tanzania, Ghana, and Uganda also feature prominently among the top ten IDA debtors, together accounting for 63 percent of the IDA’s total exposure as of June 30, 2024.

Additionally, data from the Central Bank of Nigeria’s international payment portal reveals that the Tinubu administration spent $5.39 billion on debt servicing out of a total of $9.1 billion in international payments between June 2023 and July 2024.

This amounts to 59 percent of the total international payments made during this period. The highest debt servicing payment was $854.36 million in May 2024, while the lowest was $50.82 million in June 2024.

The total international payments made by the CBN during this period showed a steady increase, with the highest payment recorded in May 2024 at $1.24 billion.