June 22, 2024

Buhari seeks Senate approval of additional $800m World Bank loan for fuel subsidy removal palliatives

Oredola Adeola

 

The Nigeria’s outgoing President Muhammadu Buhari has written to the Senate, seeking legislative approval for a new loan request of $800 million, a World Bank facility to be utilized to scale up the National Social Safety Net Programme including providing fuel subsidy removal palliative.

 

 

Senator Ahmad Lawan, Senate President, disclosed this in a letter by outgoing President Buhari in respect of the World Bank loan.

 

EnergyDay gathered that the request for the legislative approval in respect of the World Bank loan is coming on the sideline of the Government’s recent claim that it needed additional time to make the necessary preparatory work, especially on palliatives aimed at mitigating the shock and economic impact of the petrol subsidy removal on the lives of ordinary Nigerians.

 

Recall that the outgoing administration in April through the Federal Executive Council suspended the planned removal of subsidy on the claim that the time was wrong and that it would need more time to prepare palliative for the most vulnerable people.

 

 

EnergyDay gathered that the fuel subsidy removal palliative is targeted at reducing the social and economic impact especially on the prices of food and energy on the poor and vulnerable people in both rural and urban areas in Nigeria, even as estimated PMS prices post-subsidy regime are projected to be between N580 per litre and N700/l.

 

 

Zainab Ahmed, Minister of Finance, Budget, and National Planning, had in a recent statement revealed that the World Bank facility worth $800 million is the first tranche of palliatives to be disbursed through cash transfers to about 50 million Nigerians, who belong to the most vulnerable category in the society.

 

 

The financing agreement for the loan signed by both Nigeria and the International Development Association (IDA), on August 16, 2022, seen by EnergyDay, showed that part of the World Bank’s facility is dedicated to helping the world’s poorest countries.

 

According to the agreement, the loan aims to provide cash transfers to poor and vulnerable people in both rural and urban areas in Nigeria, in response to economic shocks, for at least two years.