World Bank Approves $500m Loan for 19 Northern States, Nigeria’s Debt Hits $20.73bn

The World Bank has approved a fresh $500 million loan for Nigeria to tackle flooding, restore degraded farmland and reduce farmer-herder conflicts across 19 northern states and the Federal Capital Territory.

The financing falls under the Agro-Climatic Resilience in Semi-Arid Landscapes (ACReSAL) Project. It is expected to restore 1.4 million hectares of degraded land and benefit about 6.6 million people by 2031.

What the loan will fund

The bank said the project will support climate adaptation, water management and agricultural productivity. It will also fund watershed rehabilitation, erosion control and better management of natural resources in communities exposed to climate-related disasters.

The World Bank expects the intervention to reduce flooding and associated fatalities, improve soil health, increase household incomes and strengthen agricultural productivity. It also expects it to reduce conflicts involving farmers, herders and other rural communities by improving access to productive land and water resources.

The latest financing builds on the existing ACReSAL programme, which began in 2022. The bank said the project had introduced sustainable landscape management practices across approximately 550,000 hectares and reached more than 4.4 million beneficiaries.

Debt climbs to $20.73bn

Nigeria’s outstanding debt to the World Bank has increased by $6.39 billion, or 44.6%, since March 2023, reaching $20.73 billion as of June 30, 2026. Debt Management Office figures show the debt rose from $14.34 billion in March 2023.

The breakdown as of June 2026 is $19.12 billion owed to the International Development Association (IDA) and $1.61 billion to the International Bank for Reconstruction and Development (IBRD), for a total of $20.73 billion.

The World Bank accounted for approximately 38.02% of Nigeria’s total external debt of $54.52 billion at the end of June 2026, making it the country’s largest multilateral creditor.

Quotes and implementation

World Bank Country Director for Nigeria, Mathew Verghis, said the additional funding would help expand interventions that had improved livelihoods, food security and water access in vulnerable communities.

ACReSAL Task Team Leader, Iganya Agene, added that the financing would translate earlier planning and institutional reforms into larger investments supporting jobs and economic opportunities.

The project is being implemented by the Federal Ministry of Environment in collaboration with the Federal Ministry of Water Resources and Sanitation and the Federal Ministry of Agriculture and Food Security.

The approval follows a $1.25 billion financing package approved by the World Bank on June 29, 2026, under the Nigeria Actions for Investment and Jobs Acceleration programme. That package comprised a $750 million credit from the International Development Association and a $500 million loan from the International Bank for Reconstruction and Development.

For Nigeria, the fresh loan adds to climate adaptation spending in the north but also keeps pressure on external debt, with the World Bank now the country’s largest multilateral creditor.