Keypoints:
- AfDB to disburse $500m this year
- Part of $1bn two-year support package
- Loan backs Tinubu’s fiscal and energy reforms
THE African Development Bank (AfDB) will extend $500 million to Nigeria this year as part of a $1bn budget support programme, reinforcing President Bola Tinubu’s sweeping economic reforms, a senior bank official has confirmed.
Bode Oyetunde, the AfDB’s Executive Director representing Nigeria and São Tomé and Príncipe, told Reuters on the sidelines of the Nigerian Economic Summit in Abuja that the bank’s board could approve the new loan before the end of the year.
‘We have been working strongly to support Nigeria’s very bold and aggressive macroeconomic reforms under President Tinubu. Given all these reforms, it was important to support Nigeria,’ Oyetunde said.
He explained that Nigeria had initially requested $1.5bn, but the AfDB approved $1bn to be disbursed over two years. ‘Last year, we provided $500 million in budget support. This year, we are looking to do another $500 million, subject to board approval,’ he added.
Tinubu’s bold reform path
Since assuming office in May 2023, President Tinubu has launched some of the most ambitious reforms in Nigeria’s recent history. His administration has removed fuel subsidies, unified foreign exchange rates, and introduced tax reforms designed to restore fiscal discipline and attract investment.
These moves have been welcomed by international lenders and investors but have also brought short-term economic pain, with inflation rising and household budgets squeezed. Analysts say the AfDB’s loan could help ease these pressures while sustaining the government’s broader reform agenda.
Focus on fiscal and energy sectors
According to Oyetunde, the AfDB’s programme targets fiscal management and power sector reforms, both crucial to improving Nigeria’s productivity and competitiveness.
The bank has long been a key development partner for Nigeria, funding major projects in energy, agriculture, transport, and infrastructure. The latest funding aims to deepen structural reforms and strengthen public institutions to ensure fiscal sustainability.
Economic experts at the summit described the AfDB’s continued engagement as a vote of confidence in Tinubu’s leadership and Nigeria’s economic direction. They noted that the fresh loan sends a positive signal to other multilateral lenders and investors considering deeper involvement in Africa’s largest economy.
