Nigeria Begs World Bank for $1.5 Billion to Tackle “Unending Naira Decline” and Dollar Shortage

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Nigeria is in talks with the World Bank for up to $1.5 billion in funding to alleviate a severe dollar shortage contributing to the steep decline of the naira.

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Finance Minister Wale Edun stated in a Bloomberg Television interview that they are discussing receiving $1 billion to $1.5 billion for budgetary support.

President Bola Tinubu’s reforms, including the removal of fuel subsidies and changes to the exchange-rate policy, have garnered international investor approval but led to a surge in living costs, with inflation reaching a 27-year high. Nigeria also aims to access the eurobond market later this year and is confident of having that opportunity.

The central bank’s efforts to address the dollar backlog, estimated at $5 billion, involve leveraging available liquidity within the banking system. Edun expressed optimism about clearing the backlog swiftly if steps to boost oil revenue and mobilize existing dollars succeed.

The government anticipates increased oil production and domestic refining to stabilize the naira, emphasizing the need for additional liquidity.

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