LCCI’s Dr Chinyere Almona stresses the need for transparent disbursement of the World Bank’s $500 million loan to tackle Nigeria’s economic challenges
In a recent statement, the Director-General of the Lagos Chamber of Commerce and Industry (LCCI), Dr. Chinyere Almona, called for transparent and efficient disbursement of the newly approved $500 million loan from the World Bank under the Community Action for Resilience and Economic Stimulus Programme.
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She urged the Nigerian government to ensure that the funds reach the intended beneficiaries and are used for their intended purpose, emphasising the need for a robust monitoring and evaluation framework to track the fund’s impact and prevent misallocation.
The World Bank’s financial assistance comes at a critical juncture for Nigeria, which is grappling with mounting economic challenges, including inflation, a declining purchasing power, and a burdensome national debt profile. Almona stressed that while the loan is intended to support poor and vulnerable households and businesses, the broader economic impact and implications for the business community cannot be overlooked.
“The intervention is targeted at supporting small businesses and vulnerable populations through grants and livelihood support.
This could provide much-needed short-term relief, particularly in enhancing food security and boosting community resilience,” Almona explained. “However, the potential broader implications on businesses and the overall economy require careful consideration.”
The LCCI Director-General also voiced concerns about Nigeria’s increasing debt burden. With the World Bank’s share of Nigeria’s external debt reaching $17.32 billion, she highlighted the pressing issue of debt sustainability and the country’s ability to repay such loans.
This concern is amplified by the slow pace of disbursement and implementation of previously approved loans, prompting questions about the effectiveness of the government’s financial management system.
“If these loans are not effectively managed, they risk exacerbating fiscal vulnerabilities, eroding investor confidence, and limiting the government’s capacity to implement long-term economic reforms,” Almona warned.
“While targeted stimulus measures can provide temporary relief, they do not address the fundamental structural challenges businesses face, such as inadequate infrastructure, multiple taxation, and exchange rate volatility.”
Further expressing her concern, Almona pointed out that only 16 percent of previously approved World Bank loans have been disbursed under the current administration.
She questioned whether the relevant institutions have the absorptive capacity to manage and utilise the new loan effectively, thereby raising the risk of funds being underutilised or mismanaged.
In order to maximise the benefits of this new financial assistance, Almona called for prudent debt management strategies, particularly emphasising the need for concessional financing. She also urged the government to ensure that borrowed funds are allocated to projects with clear economic returns.
Additionally, she recommended strengthening Nigeria’s domestic revenue generation through comprehensive tax reforms and expanding the country’s productive economic base.
This, she said, could reduce the country’s reliance on external borrowing. However, she stressed that social welfare programs, while important, must be part of a broader strategy that includes structural reforms focused on improving the country’s infrastructure, ensuring consistent policy frameworks, and addressing the country’s foreign exchange challenges.
“Beyond temporary measures, the government must prioritise policies that create a conducive environment for businesses.
Structural reforms aimed at improving infrastructure, stabilising the foreign exchange market, and fostering private sector growth are essential to long-term economic stability and attracting investment,” Almona concluded.
