World Bank in talks with Nigeria over new $2.5bn power project loan

The World Bank says it is in talks with the Federal Government of Nigerian  for a $2.5 billion loan to resolve the problems of the country’s power sector.

World Bank’s Vice President for Africa, Hafez Ghanem said this while addressing journalists in Abuja, Bloomberg reported on Wednesday.

“We’re talking about a new set of programmes of about the same amount, it should be around $2.5 billion,” Mr Ghanem said.

He also said the loan would enable the Nigerian economy to be more competitive for the development of industries and the creation of jobs for youth in the country.

He said the Bank’s focus in Nigeria is helping the country to fight poverty and improve living standards for its people. This it is doing with special intervention for women financial inclusion and education for children, including people living with disabilities.

Mr Ghanem said the World Bank is also supporting digital transformation in Nigeria because of its potential ability to transform other areas of the economy, including industry, agriculture, and services.

He added that the deal aids at expanding digital opportunities and solving a power crisis that hobbles economic activities.

The Bank in 2018 approved an estimated $486 million to improve and upgrade electricity transmission’s network of infrastructure and rehabilitate substations and lines in Nigeria.

“It’s important to resolve the problems of the power sector in Nigeria to bring in more investments,” Mr Ghanem said. “Because you need to bring down the cost of power to make the economy more competitive for the development of industries.

“Nigeria has a comparative advantage in that area because of the youth, a majority of the population is young,” he said. “So if we want to create jobs, we need to invest much more in the digital economy.”

The Federal Government and electricity giant, Siemens, in July signed a power deal that will lead to the production of 25,000 megawatts of electricity by 2025.

The deal is the product of a meeting President Muhammadu Buhari held with German Chancellor, Angela Merkel, on August 31, 2018.

The partnership on the road map for power generation is expected to aid the activities of the Transmission Company of Nigeria (TCN) and the eleven DisCos within the country, including software maintenance and support for four years, with a source claiming the project can be compared to that of Egypt megaproject.