MUST WE BORROW: Nigeria to get more loans from World Bank

Nigeria will soon be eligible for more funds from the World Bank, the bank’s Country Director for Nigeria, Ms. Marie-Francois Marie-Nelly, has said.

Speaking to newsmen in Abuja on Monday, Marie-Nelly said the bank had resolved to give Nigeria a blend status in its 2014-2017 Country Partnership Strategy document, which would be released later in the year.

Currently, Nigeria is only eligible to borrow from the bank’s International Development Association lending window. But with improved rating, the country will be able to borrow from the International Bank for Reconstruction and Development’s lending window.

On its website, the World Bank said the IDA was the part that helped the world’s poorest countries, while the IBRD gave loans on commercial basis to countries with the capacity for repayment.

It said, “Established in 1960, IDA aims to reduce poverty by providing loans (called ‘credits’) and grants for programmes that boost economic growth, reduce inequalities, and improve people’s living conditions.

“IDA complements the World Bank’s original lending arm – IBRD. IBRD was established to function as a self-sustaining business and provides loans and advice to middle-income and credit-worthy poor countries. IBRD and IDA share the same staff and headquarters and evaluate projects with the same rigorous standards.

“IDA is one of the largest sources of assistance for the world’s 82 poorest countries, 40 of which are in Africa. It is the single largest source of donor funds for basic social services in these countries. IDA-financed operations deliver positive change for 2.5 billion people, the majority of who survive on less than $2 a day.

“IDA lends money on concessional terms. This means that IDA charges little or no interest and repayments are stretched over 25 to 40 years, including a five- to 10-year grace period. IDA also provides grants to countries at risk of debt distress.”

Marie-Nelly said poverty rate per capita in Nigeria had now dipped to 62.6 per cent from 64.2 per cent.

Citing the National Bureau of Statistics figures between 2003 and 2009, the World Bank director said the urban poverty within the same period had equally reduced to 51.2 per cent from 52.2 per cent, whereas rural poverty dropped to 69 per cent from 73.4 per cent.

Similarly, in adult equivalent terms, poverty rate has gone down to 46.1 per cent from 48.3 per cent and urban poverty has come down to 34.3 per cent from 36.8 per cent, while rural poverty dipped to 52.9 per cent from 57.4 per cent within the period under review.

However, Marie-Nelly said extreme poverty was slightly higher at 63.4 per cent in 2010, based on $1.25 per day, adding that the target by 2020 was to reduce it significantly.

The bank had in October 2010 said at best, the rate of poverty in Nigeria was controversial and might actually be on the increase despite improved earnings from export of crude oil in recent years.

In a video press conference to mark the release of Africa’s Pulse, an analysis of issues shaping the continent’s economic future, the World Bank’s Chief Economist for African region, Mr. Shanta Devarajan, had said that poverty rate in resource rich countries on the continent was reducing slower than in non-rich resource nations.

Answering a question specific on Nigeria’s poverty rate, Devarajan said the subject was very controversial and suggested that the country should invest more in the production of statistics that were reliable.