The African Development Bank Group announced on Wednesday that it has approved a $500 million loan facility for Nigeria.
This substantial funding is specifically designated to support the second phase of the country’s economic governance and energy transition support programme.
This facility is designed to bolster Nigeria’s comprehensive efforts to modernize its electricity infrastructure, significantly expand access to cleaner energy sources, and deepen ongoing fiscal and governance reforms. This new loan follows a similar $500 million facility that the AfDB approved in August 2024 for the first phase of the same programme.
The AfDB stated that the second phase, which covers Nigeria’s fiscal years 2024 and 2025, is strategically designed to “stimulate inclusive growth by accelerating structural reforms in the energy sector, while supporting progressive reforms of fiscal policy to boost non-oil revenues and expand fiscal space.”
According to the development bank, the entire programme is concentrated on three core areas of reform. These areas include strengthening public financial management and improving spending transparency; advancing reforms in the power sector to reduce energy poverty and attract private investment; and supporting Nigeria’s energy transition plan through essential climate-adaptation and mitigation measures, including new energy-efficiency standards for electrical appliances.
Furthermore, the programme’s activities will also provide necessary guidance for Nigeria as it updates its nationally determined contribution for the crucial 2026–2030 period.
The direct beneficiaries of this facility include several key government bodies, such as the ministries of power, finance, and environment, alongside the Federal Inland Revenue Service, the Office of the Auditor-General, the Debt Management Office, the National Climate Change Council, and the Nigerian Electricity Regulatory Commission. The AfDB added that the private sector will also benefit significantly from a more stable investment climate and new opportunities that are inherently tied to the national energy transition.
As of 31 October 2025, the African Development Bank’s active portfolio within Nigeria consisted of 52 projects in total, valued at a combined sum of $5.1 billion.
Abdul Kamara, AfDB’s director-general in Nigeria, offered his thoughts on the new phase, stating that it “will reinforce and build on the achievements of the first phase.”
