The World Bank Group (WBG) said its board has approved the $1.5 billion for Nigeria for two projects.
The global bank announced this in a statement issued on Tuesday.
The affected projects are an International Development Association (IDA) credit of $750 million Nigeria Covid-19 Action Recovery and Economic Stimulus – Program for Results (Nigeria CARES).
World Bank also approved a different $1.5 billion package for Nigeria to help build a resilient recovery post-COVID-19.
The bank had earlier threatening to withhold $1.5 billion until Nigeria carries out foreign exchange reforms to its satisfaction.
While Nigeria is still working on its forex reforms, it appears the World Bank was moved to change its mind.
This is because “government revenues could fall by more than $15 billion this year, and the crisis will push an additional 5 million Nigerians into poverty in 2020.”
The statement issued on Tuesday, reads in part:
“This program will help increase access to social transfers and basic services, as well as provide grants to poor and vulnerable households. It will also strengthen food supply chains for poor households while facilitating recovery and enhancing capabilities of MSMEs. This is financed through.”
It adds: “The Additional Financing will help meet the financing gap in the Programme Expenditure Framework, due to the sharp reduction in government revenues associated with the crisis”.
The bank noted that it “help increase the efficiency in spending, strengthen revenue mobilization, and enhance accountability and transparency in public resource management to further strengthen state-level COVID-19 response.”
The World Bank, however, was silent on if the forex reform it demanded from the Nigerian authorities has been carried out. However, one its demands, the harmonization of forex rates is still in effect.