FG seeks $500m World Bank fresh loan to finance infrastructure as Tinubu’s tenure nears end

The Federal Government is seeking a fresh $500m loan from the World Bank to establish an infrastructure financing platform, with the proposed approval date falling four days before the scheduled inauguration of Nigeria’s next president in May 2027.

The proposed facility is part of a wider $3.85bn initiative designed to attract private investment into critical sectors of the Nigerian economy, including energy, transportation and water.

Details of the proposed financing are contained in the World Bank’s Initial Project Information Document for the Nigeria Infrastructure Financing and De-Risking Platform for Growth and Jobs, known as INFRAGROW. The document was prepared and updated on November 4, 2026, according to a report by The PUNCH published on Monday.

The Federal Ministry of Finance is listed as the borrower, while the Nigeria Sovereign Investment Authority (NSIA) will serve as the implementing agency.

The World Bank has scheduled the project’s technical design review for January 21, 2027, with May 25, 2027, listed as its estimated approval date.

The proposed date is particularly significant as Nigeria’s next presidential inauguration is scheduled for May 29, 2027, meaning the facility could receive approval shortly before the end of President Bola Tinubu’s current tenure.

However, the proposed financing has not yet received approval, and the World Bank’s timetable remains subject to change. Approval would also not automatically translate into immediate disbursement or implementation. Punch Newspapers +1

### How the $3.85bn financing platform will work

The World Bank’s document estimates Nigeria’s annual infrastructure financing gap at approximately $100bn, identifying inadequate investment and weak project preparation as major obstacles to economic growth, fiscal sustainability and job creation.

The proposed $500m World Bank facility comprises $400m from the International Bank for Reconstruction and Development (IBRD) and $100m from the International Development Association (IDA).

The wider $3.85bn financing structure is expected to combine contributions from government, private investors, commercial lenders and international financial institutions.

Under the proposed arrangement, the NSIA is expected to contribute $200m in equity as a founding shareholder, while private-sector investors would provide another $200m. Commercial debt financing is projected at $600m.

The arrangement also includes $100m in IDA payment guarantees and $2.25bn in guarantees from other international financial institutions, bringing the proposed guarantee-related financing to $2.35bn.

The platform is expected to operate through four independently governed subsidiaries, each designed to address specific challenges affecting infrastructure investment.

The first is the Project Preparation Facility, which will finance feasibility studies, transaction structuring, risk assessments and procurement support to make infrastructure proposals more attractive to investors.

The second is the Viability Gap Fund, which will provide financial support for economically important projects that cannot generate sufficient commercial returns while maintaining affordable tariffs or sustainable government payments.

The third, the Risk Capital Facility, will provide equity and other forms of long-term capital to commercially viable infrastructure projects that struggle to attract investors because of their risk profiles.

The fourth is the Credit Guarantee Vehicle, which will provide guarantees against specified credit defaults, public-sector payment failures and political risks affecting eligible foreign investments.

The World Bank expects the facilities to encourage participation by commercial banks, pension funds, insurance companies and other institutional investors.

### Environmental and social risks

The proposed project will also support reforms aimed at strengthening public institutions responsible for identifying, preparing, procuring and supervising public-private partnership projects.

Its implementation will be divided into four components covering institutional development, project preparation, financing mobilisation and improvements to the regulatory environment.

The International Finance Corporation is expected to participate as a prospective co-investor, while the Multilateral Investment Guarantee Agency may provide political risk insurance.

However, the World Bank has classified the project’s environmental and social risks as high because the financing platform could support large-scale infrastructure developments in sectors such as energy, transportation and water.

Potential risks identified include land acquisition, displacement of communities, environmental damage, occupational hazards and other social consequences.

The proposed INFRAGROW initiative is intended to expand sustainable infrastructure investment by improving project preparation, reducing investment risks and mobilising private capital.

Its eventual impact will depend on the project’s approval, implementation and management, as well as the ability of the proposed facilities to attract the level of private investment envisaged.

Source: The PUNCH, November 9, 2026. Punch Newspapers +2

Stay Connected

Follow Very Nigerian

Get the latest Nigerian news, trending stories and breaking updates directly on WhatsApp.

Join Our Channel →