The Federal Government is to raise the sum of $6.9bn through external borrowing from the World Bank, the International Monetary Fund and the African Development Bank. The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, disclosed this on Monday in Abuja during a media briefing on the fiscal policy measures to tackle the impact of the coronavirus pandemic on the economy.
The amount, according to her, is in form of concessional funding to support the implementation of the 2020 budget. The borrowing became imperative as a result of the negative impact of the coronavirus pandemic, which had led to unprecedented disruption in global supply chains. It has led to a sharp drop in global crude oil prices, turmoil in global stock and financial markets, and lockdown of movements of persons in many countries.
Giving a breakdown of the $6.9bn, the finance minister said the sum of $3.4bn would be sourced from the IMF, $2.5bn from the World Bank while the balance of $1bn is expected to be raised from the AfDB. Out of the World Bank facility of $2.5bn, she said the sum of $1.5bn would go to the Federal Government while the balance of $1bn would go to the 36 state governments.
The funds, according to the finance minister, are expected to come into the country within the next 6 to 12 weeks. She said the $3.4bn from the IMF would not be tied to any conditionality, adding that so far, about 80 countries had applied for such funding facility. Ahmed said, “We are continuing our engagements with the World Bank, the AfDB, the IDB and the IMF to access concessional funding to support the implementation of the 2020 budget.
“We have also applied for funding from the IMF’s COVID-19 Rapid Credit Facility to draw from our existing holdings with the World Bank Group/IMF. “This loan will not be tied to any conditionality. However, it is important to clarify that Nigeria does not intend to negotiate or enter into a formal programme with the IMF at this time or in the foreseeable future.”
She added, “Nigeria has a contribution of $3.4bn with the IMF and we are entitled to draw up to the whole of that $3.4bn. We have in the first instance applied for that maximum amount. “We have requested from the World Bank $2.5bn, from the ADB $1bn. Let me state that the requests are for the nation, both for the FG and the states.”