African Development Bank (AfDB) approves $500m new loan for Nigeria

Friday, November 28, 2025 - The African Development Bank (AfDB) Group has announced that it is providing $500 million in budget support to Nigeria’s Federal Government to help improve non-oil revenues and expand fiscal space.

In a press release, the AfDB said its Board of Directors approved the loan to finance the second phase of the Economic Governance and Energy Transition Support Programme, noting that the policy-based operation covers fiscal years 2024 and 2025.

“The second phase of the programme aims to stimulate inclusive growth by accelerating structural reforms in the energy sector, while supporting progressive reforms of fiscal policy to boost non-oil revenues and expand fiscal space,” the bank said.

Abdul Kamara, Director General of the AfDB’s Nigeria Office, explained that the new phase “will consolidate and build on the achievements of the first phase.”

According to the statement, the programme will focus on three key areas: deepening fiscal policy reforms by strengthening public financial management and improving transparency and efficiency in public spending; accelerating reforms in the power sector to reduce energy poverty, expand access, improve governance, and attract private investment; and supporting implementation of Nigeria’s energy transition plan through climate adaptation and mitigation measures, including new energy-efficiency standards for electrical appliances.

The statement added that Nigeria’s Nationally Determined Contribution (NDC) will be updated for the 2026–2030 period.

“The programme’s direct beneficiaries are the Federal Ministry of Power, the Federal Ministry of Finance, the Federal Inland Revenue Service, the Office of the Auditor General, the Debt Management Office, the National Climate Change Council of Nigeria (NCCC), the Federal Ministry of the Environment, the Nigerian Electricity Regulatory Commission (NERC), and other bodies responsible for social and economic policies.

“Benefits will also accrue to private businesses in the form of improved investment climate and opportunities in the energy sector at the level of individual states of the Federation, and from the creation of an environment more conducive to public-private partnerships,” the AfDB said.

As of 31 October 2025, the bank’s active portfolio in Nigeria comprised 52 projects with a total commitment of $5.1 billion.