The federal government of Nigeria has gotten approval from the World Bank to secure a loan of $3 billion loan for the improvement of the power sector in the country.
The minister of finance, Zainab Ahmed, disclosed this while speaking to reporters on Sunday, October 20, 2019, at the annual meetings of the World Bank/International Monetary Fund in Washington DC.
She said that “This financing will cover the gap between the current tariff and the actual cost of generating electricity.
“It will also enhance our ability to pay previous obligations in the sector that has crystallised so that investors in the sector can go on with expanding investments in the sector.”
Furthermore, the finance minister noted that the loan will be released in four tranches of $750 million each and there is room for the loan to be expanded to $4 billion.
She said: “Some portion of the loan will be for the transmission network and if we are able to expand to $4 billion then the extra $1 billion will be for the distribution network.”
“The distribution sector will be at the backend when the other reforms have been carried out.
“It will be a loan to the distribution companies because they are owned by the private sector.”