Nigeria Cancels $717.7M World Bank Power Loan Amid Crisis

The Federal Government of Nigeria has officially canceled a $717.7 million loan from the World Bank, which was aimed at supporting the recovery of the country's electricity sector. This decision, made on March 26, 2026, is part of a joint agreement to discontinue the financial program due to the ongoing crisis in the electricity sector, characterized by rising tariff deficits and foreign exchange pressures.

The cancellation follows a World Bank restructuring document that indicated a significant deterioration in the sector's financial position, exacerbated by the devaluation of the naira and the inability to adjust electricity tariffs in line with rising operational costs. The program, initially approved in June 2020, was intended to implement ambitious reforms to improve electricity reliability and restore financial viability.

However, the implementation faced challenges, leading to unmet disbursement targets and a total commitment of approximately $1.51 billion, with $717.7 million remaining undrawn. Ogunjimi urged the World Bank to expedite the approval process for future funding to support Nigeria's development priorities.