The Federal Government is in discussions with the World Bank over three proposed loans worth a combined $1.5 billion, even as Nigeria's public debt climbed to N166.79 trillion at the end of June 2026.
The proposed World Bank financing consists of three separate $500 million facilities targeting climate resilience, social protection and early childhood development.
The proposed facilities are at different stages of preparation and should not be regarded as approved loans yet.
The development comes shortly after the Debt Management Office (DMO) published Nigeria's latest debt figures, showing that total public debt increased from N159.35 trillion in March 2026 to N166.79 trillion in June 2026.
World Bank Proposes $500m Additional Financing for ACReSAL
The most immediate of the three proposed facilities is an additional $500 million for the Agro-Climatic Resilience in Semi-Arid Landscapes (ACReSAL) project.
The proposed financing would increase the overall size of ACReSAL from its previously approved $700 million to $1.2 billion, with the additional funding expected to come through the World Bank's International Development Association (IDA).
The Federal Republic of Nigeria is listed as the borrower, while the Federal Ministry of Environment is expected to serve as the implementing agency.
The additional financing is designed to scale up activities aimed at improving climate resilience and restoring degraded landscapes.
Proposed areas of intervention include:
Landscape restoration
Watershed rehabilitation
Erosion and flood management
Irrigation and drainage
Water harvesting and storage
Reforestation
Other climate-resilient activities
The proposed $500 million additional financing would allocate about $310 million to dryland management, $165 million to community climate resilience and $25 million to institutional strengthening and project management.
ACReSAL currently operates across 19 northern states and the Federal Capital Territory, focusing on issues including land degradation, water insecurity, climate vulnerability and declining agricultural productivity.
The World Bank has identified climate change, desertification and land degradation as significant challenges for Nigeria's agricultural and economic development.
Second $500m Loan Proposed for Social Protection
The second proposed facility is a $500 million IDA credit for the Household Prosperity and Empowerment-Social Protection Project, known as HOPE-SP.
The project is intended to expand social assistance for poor and vulnerable households while strengthening the systems used to deliver social protection programmes.
The Federal Ministry of Finance is listed as the borrower, while the Federal Ministry of Humanitarian Affairs and Poverty Reduction is expected to implement the programme.
The proposed financing consists of a $420 million results-based component and an $80 million investment project financing component.
The programme would support targeted unconditional and conditional cash transfers, modernise the social registry and strengthen social protection systems at federal, state and local government levels.
It also proposes integrating the National Identification Number (NIN) into the social protection information system.
According to the World Bank documents, the programme is intended to gradually increase the role of federal and state budgets in financing social assistance.
World Bank Highlights Nigeria's Social Protection Challenges
The World Bank has previously highlighted gaps in Nigeria's social protection system and the need to strengthen support for vulnerable households.
The proposed HOPE-SP programme is designed to improve the regular delivery of social assistance and strengthen the systems through which beneficiaries are identified and supported.
The lender has also noted that Nigeria's investment in social safety-net programmes has remained relatively low compared with international averages.
The proposed programme therefore focuses not only on financial assistance but also on improving the systems used to identify beneficiaries, manage payments and coordinate social protection interventions.
Third $500m Facility Targets Early Childhood Development
The third proposed World Bank facility is another $500 million financing package for Nigeria's Early Childhood Development programme.
The proposed programme would cover all 36 states and the Federal Capital Territory.
It is designed to improve children's access to an integrated package of services covering areas such as:
Health
Nutrition
Early learning
Childcare
Water and sanitation
Other essential early-childhood services
The programme would be financed through a $400 million programme-for-results component and $100 million investment project financing component.
The World Bank has identified early childhood development as an important area for Nigeria because of persistent challenges involving child nutrition, early learning and access to essential services.
The lender has also warned that weaknesses in nutrition, learning and skills development can have long-term consequences for productivity and future earnings.
Nigeria's Public Debt Rises to N166.79tn
The proposed World Bank financing comes as Nigeria's total public debt reaches a new level.
According to the DMO, Nigeria's total public debt stood at N166.79 trillion as of June 30, 2026, up from N159.35 trillion three months earlier.
The latest figure represents an increase of N7.44 trillion, or about 4.67 per cent, between March and June 2026.
Domestic debt remained the larger component of the portfolio at N91.59 trillion, representing 54.91 per cent of the total, while external debt stood at N75.20 trillion, representing 45.09 per cent.
The DMO released the latest debt figures on September 25, 2026, alongside separate reports covering Federal Government domestic debt, external debt, debt servicing and state and FCT liabilities.
World Bank Exposure to Nigeria Also Rises
Nigeria's proposed new borrowing comes against the backdrop of an already substantial World Bank exposure.
The latest debt data show that the World Bank Group is one of Nigeria's major external creditors, with the International Development Association accounting for a significant portion of the country's multilateral obligations.
The proposed additional financing would therefore increase Nigeria's obligations to the World Bank if the facilities are eventually approved, signed and disbursed.
However, the proposed facilities are designed to finance specific programmes rather than provide unrestricted budget support, with the projects focused on climate resilience, social protection and early childhood development.
Treasury Bills Drive Part of Domestic Debt Growth
The DMO's latest data also show increased reliance on Treasury bills within the Federal Government's domestic borrowing portfolio.
Outstanding Nigerian Treasury Bills increased significantly between June 2025 and June 2026.
Federal Government domestic debt also includes conventional naira bonds, securitised Ways and Means advances, domestic dollar bonds, promissory notes and other instruments.
The growth in domestic liabilities has contributed to the overall increase in Nigeria's public debt stock.
Borrowing Debate Intensifies
The proposed World Bank loans are likely to add to the ongoing debate about Nigeria's borrowing requirements, debt sustainability and how borrowed funds are deployed.
Supporters of development financing typically point to the importance of funding infrastructure, human capital and climate-resilience programmes, particularly where financing is provided on concessional terms.
Critics, however, have continued to question Nigeria's rising debt stock and the growing cost of servicing government obligations.
Former Vice-President Atiku Abubakar recently asked the Federal Government to provide Nigerians with a detailed explanation of the country's rising debt after the DMO reported the N166.79 trillion figure.
Atiku argued that the government should disclose details of new loans, existing obligations and debt repayments. His comments were part of a wider political debate over the Tinubu administration's economic policies and borrowing strategy.
The Federal Government's proposed World Bank financing now places renewed attention on how Nigeria balances the need for development funding with the management of its growing public debt.
If approved, the three proposed $500 million facilities would direct new financing towards climate resilience, social protection and early childhood development, while adding to Nigeria's existing obligations to the World Bank.
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