Nigeria seeks $500m World Bank loan to fix rural roads, food price hike

The Nigerian federal government is seeking a $500 million loan from the World Bank to repair rural roads, improve nationwide access to agricultural products, and combat rising food prices.

The World Bank noted that the funds will benefit 92 million people in rural areas with poor road infrastructure.

The request was detailed in the final draft of the Resettlement Policy Framework for the Nigeria Rural Access and Agricultural Marketing Project Scale-Up, implemented by the Federal Ministry of Agriculture and Rural Development.

The RAAMP-SU project will finance three main components: $387 million for resilient rural access improvement, $158 million for climate-resilient asset management, and $55 million for institutional strengthening and project management.

The project’s total cost is estimated at $600 million, with the World Bank expected to cover 83.33% of the funding, a 79% increase from the initial $280 million commitment for the parent project.

The policy document states that participating states must have a fully functional Roads Fund and Roads Agency, with appointed boards and staff, and provisions for administrative costs included in the state budget.

“Rural access is particularly limited in densely populated, economically disadvantaged areas. Expanding and enhancing the rural road network, as well as conserving transport assets, is essential,” the document noted. It also highlighted the need for women’s representation in the transport sector.

This development comes amid rising food inflation in Nigeria, which hit 40.53% in April 2024, according to the National Bureau of Statistics. Experts attribute the increase to insecurity, high energy costs, and expensive transportation.

Nigeria’s total debt at the end of 2023 was N97.341 trillion, with foreign debt accounting for N38.22 trillion, or 39% of the total, as reported by the Debt Management Office.