The World Bank pledges $8.5 billion to Nigeria to fund critical issues

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Shubham Chaudhuri, the World Bank Country Director of Nigeria. Credit: The World bank of Nigeria
Shubham Chaudhuri, the World Bank Country Director of Nigeria. Credit: The World bank, Nigeria

The world bank has pledged to give $8.5 billion to Nigeria for the development of the country's
education and agriculture sectors. This was disclosed by the World Bank Country Director to Nigeria, Shubham Chaudhuri on Thursday, August 4th in Abuja during a summit organized by the Emergency Coordination Center.
Shubham said that the amount was the largest the bank has given to any country. Still, he noted that the
amount is small compared to the immeasurable needs of the country. He said the bank intends that the
money be channeled to agriculture and education with about $2.5 billion to $3 billion of the fund to the
development of the latter.

“Half of the population of Nigeria itself is less than 17 years old. This means there is a need to invest in
human capital development,” Chaudham said.

The World Bank country director also stated that the future of Nigeria depended on the ability of the
youth to go to school while stressing that it is important that Nigerian schools be made safe.

However, he also said that decision on how to mobilize its financial resources to enable young Nigerians
to go to school is entirely to the Nigerian Government while stating that he wondered If the Nigerian
government would rather choose to use the funds on subsidizing petrol which is over N6.5 trillion.

Listed by Forbes as one of the 5 countries in the world that would be facing a higher risk of
overpopulation by 2030, Nigeria is Africa’s most populous nation but it is mobilizing N6.7 trillion for
petrol subsidies at the expense of education and health.

Studies has shown that about 10.1 million children are out of school, while report suggests it could be
up to 18.5 million.
Analysts and experts have described Nigeria’s constant insistence on offsetting subsidies as a poor
financial decision that would have adverse consequences on the future Nigerian economy.

Professor Jonathan Aremu, a former CBN Assistant Director and Senior Lecturer at Covenant University
says that subsidies had distorted the market, making it difficult for products to be appreciated for their
actual value.

“In economics, subsidy is always bad. Yes, quite a lot of people depend on fuel, which is why they have
continued to subsidise petrol, but we don’t know how much is spent on subsidy," he said
Uche Nwogwugwu, a Professor of Energy Economics at Nnamdi Azikiwe University, has also said that the
removal of subsidies would indeed be a step in the right direction.

However, he further said that the removal of petrol subsidy in these times would lead to increased
poverty and likely cause social unrest for Nigerians
He also suggested an alternative route Nigeria could take.

“It’s completely true that the burden is weighing and will continue to weigh on the economy. Some
discrete facts are here to help save the country, Uche said “The PIA has made NNPC a limited liability
company that can seek profit. This is a good base for solving the subsidy. It is acknowledged that the
nation has been subsidizing consumption and now she wants to channel to production. Expanding the
market locus to include neighboring countries of Cameroon, Ghana, Niger, Mali, and Sudan where it is
sold for about N300- N400 equivalent per liter will recoup all monies and also bring profit,” he stated
further.

“It will also completely eradicate the activities of smugglers. Under Africa free trade charter, NNPC can
sell to neighboring countries while giving the nation a breathing gap to solve the domestic disequilibria,”
he concluded.

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