The World Bank is expected to approve a new $500 million loan to Nigeria next month to enhance agricultural productivity, strengthen value chains, and create jobs across participating states.

Details of the planned facility are outlined in the World Bank’s Project Information Document on the Nigeria Sustainable Agricultural Value-Chains for Growth. According to the document, the project has an estimated approval date of March 30, 2026, with a total operation cost and total financing of $500 million.

The entire funding will be provided by the International Development Association (IDA) as an IDA credit of $500 million. The borrower is the Federal Republic of Nigeria, with implementation handled by the Federal Ministry of Agriculture and Food Security alongside participating states.

The project’s development objective is to increase smallholder productivity and strengthen targeted agricultural value chains in participating states. The review process has progressed beyond the appraisal stage to the decision-making phase, signalling that the project has cleared a key internal hurdle ahead of final approval.

The World Bank highlighted Nigeria’s structural challenges, noting that creating more and better jobs while addressing food and nutrition insecurity remain major development priorities. Agriculture continues to be the country’s largest employer, supporting roughly one-third of the workforce, with primary agriculture alone employing about 21 million people.

Despite its potential, the sector faces significant constraints, with Nigeria currently importing around $10 billion worth of food annually.

The new project, also known as AGROW, will adopt a private sector-led, public sector-facilitated approach to enhance smallholder productivity, integrate farmers into structured output markets, and promote value addition. The initiative aligns with the Federal Government’s Renewed Hope Agenda and aims to leverage agriculture as a driver of rural employment and income growth. It is also designed to mobilise private capital, being both “MFD-Enabling” and “Private Capital Enabling.”

The $500 million facility will be deployed across four major components: integrating smallholder farmers into competitive value chains, modernising smallholder production, strengthening policy and the enabling environment for private investment in input markets, and project coordination and monitoring.

Under the value chain integration component, the project will support aggregation models linking smallholders with off-takers and agribusinesses to reduce transaction costs and improve supply reliability. On the production side, investments will target research, extension systems, improved seeds, and digital agriculture platforms to increase yields and climate resilience.

The policy component will tackle systemic constraints in seed and fertiliser markets and promote responsible land-based investments through the Framework for Responsible and Inclusive Land-Intensive Agriculture.

If approved as scheduled at the end of March, the $500 million IDA credit will join Nigeria’s growing portfolio of World Bank loans. Nigeria’s debt to the IDA surged by $1.9 billion in just one year to $18.7 billion as of December 31, 2025, rising from $16.8 billion at the end of 2024, an 11.3% increase.

These figures place Nigeria as the third-largest borrower in the IDA portfolio, after Bangladesh ($23.0 billion) and Pakistan ($19.4 billion). The sharp rise reflects growing reliance on multilateral concessional financing as the Federal Government navigates tightening fiscal space amid global market volatility.

As of June 30, 2025, Nigeria’s external debt stood at $46.98 billion, with the World Bank Group accounting for $19.39 billion—$18.04 billion from IDA and $1.35 billion from the International Bank for Reconstruction and Development—representing 41.3% of the total and underscoring the Bank’s pivotal role in financing Nigeria’s development programs.