Indications have emerged that the World Bank is toying with Nigeria over the proposed $1.5 billion loan put forward since six months after.
The loan was signed in February 2020 but yet to be disbursed six months after.
A report from Fayer and Fraser an exclusive newsletter edited by Feyi Fawehinmi, a respected Financial analyst, shows that the loan from the World Bank has remained elusive.
The report further noted that the institution has continued to move the goalposts through stringent conditions that are unprecedented.
According to Fawehinmi, it is difficult to understand why the World Bank appears to be leading Nigeria on a merry dance over a relatively small loan amount that is less than half of what the International Monetary Fund (IMF) already approved and disbursed.
The World Bank approached Nigeria in February 2020 for a possible loan disbursement as the world envisioned the economic impact of COVID-19 on the global economy particularly emerging markets in sub-Saharan Africa like Nigeria. Yet after several presentations that lasted between March and April, the loan remains un-disbursed. The loan was meant to be disbursed in June 2020.
Several reports at the time indicated that the World Bank had laid out conditions upon which the Apex bank was to lend money to Nigeria among which are a unification of the exchange rate, removal of fuel subsidy, and introduction of a cost-reflective tariff. This is despite being a loan tied to the Covid-19 pandemic.
According to Faye and Fraser “One speculation is that the World Bank is unhappy that foreign portfolio investors are now stuck in the country unable to get the dollars they need to exit their positions and leave the country.
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“But this is also not the first time the World Bank will lead Nigeria on such a dance that ultimately ends in disappointment. In 2016 there were extensive talks about a loan which went on and on and ended with no funds being disbursed. Most disturbing is that the World Bank now seems to be using the media to selectively leak information to the public designed to paint a picture of the country’s resistance to reforms as the sole reason for the delay,” Fayer and Fraser said.
