The Nigerian federal government is seeking a $500 million loan from the World Bank to repair rural roads, enhance nationwide access to agricultural products, and address rising food prices.
The Washington-based lender noted that the funds will benefit 92 million rural residents who lack adequate road networks.
This funding request was included in the final draft of the Resettlement Policy Framework for the Nigeria Rural Access and Agricultural Marketing Project Scale-Up, spearheaded by the Federal Ministry of Agriculture and Rural Development.
The RAAMP-SU project will support three primary areas: Improvement of Resilient Rural Access ($387 million), Climate-Resilient Asset Management ($158 million), and Institutional Strengthening and Project Management ($55 million).
The project’s total estimated cost is $600 million, with the World Bank expected to cover 83.33% of the funding. This commitment is 79% higher than the initial $280 million commitment for the parent project.
According to the policy document, participating states must establish a fully operational Roads Fund and Roads Agency with appointed boards and staff, and allocate funds for administrative costs in their budgets.
“Rural access is particularly restricted in areas densely populated by the economically disadvantaged, highlighting the need to expand and improve the rural road network and preserve rural road and transport assets.
“While eligibility for state participation under RAAMP required drafting and placing Road Fund and Roads Agency bills in the State Houses of Assembly, the new project mandates states to have fully functional Roads Funds and Roads Agencies with appointed boards and staff, and budget provisions for administrative costs. Additionally, RARAs present an opportunity to promote women’s representation in the transport sector,” the document stated.
This development comes amid rising food inflation in Nigeria. In April 2024, the National Bureau of Statistics reported a food inflation rate of 40.53%.
Experts attribute food price hikes in Nigeria to insecurity, energy costs, and high transportation expenses.
Meanwhile, Nigeria’s total debt stock at the end of 2023 was N97.341 trillion, as reported by the Debt Management Office. This figure includes foreign debt, which was N38.22 trillion, representing 39% of the total debt at the end of 2023.