Nigeria eyes another $500 million World Bank loan to support basic education 

The Federal Government of Nigeria is negotiating a $500 million loan from the World Bank to boost basic education, focusing on improving learning outcomes and reducing the number of out-of-school children.

According to the Programme Information Document (PID) seen by Nairametrics, the loan is part of the World Bank’s HOPE for Quality Basic Education for All initiative.

The project, which is expected to receive formal approval by March 2025, aims to address Nigeria’s education challenges and enhance access to early childhood, primary, and junior secondary education.

Project operation to cost $554 million 

The total cost of the operation is estimated at $554 million, with $500 million coming from the World Bank, while the remaining $54 million will be sourced through a Global Partnership for Education (GPE) grant.

The PID read: “The HOPE-Education operation will be financed by a World Bank IDA credit of US$500 million and a GPE grant of US$54 million. The Bank has been selected as one of two Grant Agents (along with UNICEF that will manage the other US$54 million) for the implementation of the System Transformation Grant (STG) of $107.59 million; program design, oversight and TA for implementation support will be aligned across both Agents.” 

The initiative aligns with Nigeria’s Universal Basic Education (UBE) framework, targeting regional disparities and promoting equal access to education. It aims to reduce the staggering number of 17.1 million children aged 5 to 14 who are currently out of school.

According to the PID, special attention will be given to addressing the education gap between the northern and southern regions, where enrolment levels in the north are significantly lower.

The Federal Ministry of Finance, working alongside the Federal Ministry of Education and the Universal Basic Education Commission (UBEC), will oversee the implementation of the project.

The loan will be deployed to improve the quality of teaching through capacity-building initiatives, provide grants to community-based schools, and fund infrastructure development.

This loan is part of Nigeria’s broader Human Capital Development strategy, which aims to build a skilled and productive workforce by 2030. Complementary efforts such as the National Home-Grown School Feeding Programme will help reduce the financial burden on parents and encourage higher school enrolment.

Three-in-one loan package 

The PID notes that the HOPE-Education project is part of a broader framework involving two other related initiatives.

The first, HOPE-Governance (HOPE-GOV), focuses on improving the management and distribution of financing for education and healthcare, enhancing transparency, and strengthening workforce performance.

The second, HOPE-Primary Health Care (HOPE-PHC), targets improving the quality and reach of healthcare services.

The World Bank approved $500 million for HOPE-GOV and $570 million for HOPE-PHC on September 26, 2024.

Approval for the HOPE-Education project is expected on March 20, 2025, making it the final component of these interdependent initiatives.

What you should know 

Under President Bola Tinubu’s administration, Nigeria has secured $6.45 billion in World Bank loans over the last 16 months to finance various projects, including $750 million for the power sector, $500 million for women’s empowerment, $700 million for girls’ education, and $750 million for renewable energy.

• During the launch of the Nigeria Development Update report in Abuja on Thursday, the World Bank’s Country Director for Nigeria, Dr Ndiame Diop, reaffirmed the institution’s commitment to supporting Nigeria’s reform agenda.
• Diop emphasized that the World Bank remains willing to provide more loans and technical assistance to Nigeria’s federal and state governments.
• Data from the Debt Management Office (DMO) shows that as of March 31, 2024, Nigeria owed the World Bank $15.59 billion.
• The country has also become the third-largest borrower from the World Bank’s International Development Association (IDA) as of June 30, 2024, reflecting a notable increase in borrowing.
• The World Bank’s financial statements show that Nigeria’s exposure to the IDA increased by 14.4% from $14.3 billion in the 2023 fiscal year to $16.5 billion in 2024.
• This $2.2 billion increase has moved Nigeria from being the fourth-largest IDA borrower to the third-largest.

This debt is distinct from loans provided by the World Bank’s International Bank for Reconstruction and Development (IBRD).