The International Finance Corporation (IFC), a part of the World Bank Group, and the Central Bank of Nigeria (CBN) have inked a deal to invest $1 billion to expand local currency financing in Nigeria.
The goal of this cooperation, which was unveiled in Washington, DC, is to improve financing options for private companies operating in Nigeria’s priority sectors, including housing, energy, infrastructure, agribusiness, small and medium-sized businesses, and the youth economy.
In a statement, the IFC clarified that this collaboration would enable it to enhance its investments in Nigerian Naira and manage currency risks, promoting long-term economic growth. Targeting industries in need of local currency capital, the objective is to give more than $1 billion in funding over the next several years.
The agreement was hailed as a “pioneering initiative” by CBN Governor Mr. Yemi Cardoso, who said it will open up vital long-term local currency finance for private companies in Nigeria. “This partnership represents a major advancement in the CBN’s dedication to implementing creative development projects via reliable outside service providers, going beyond conventional intervention programs. It will boost economic expansion and further the Federal Government’s goal of economic diversification,” Cardoso said.
In order to meet the growing demand for a variety of funding choices and to better manage currency risk, IFC Managing Director Mr. Makhtar Diop continued, “IFC must increase access to affordable local currency financing for small businesses in Nigeria.” By strengthening lending in Nigerian Naira, our collaboration with the Central Bank of Nigeria will promote economic expansion and job creation throughout the nation.
The IFC continues to place a high premium on local currency finance, with an active portfolio of $2.13 billion in Nigeria, the second largest in Africa. In order to address the demand for greater local currency funding in emerging markets, Diop promised that the IFC would make use of cutting-edge financial innovations and partnerships.
Working in more than 100 countries, IFC is the largest global development organisation devoted to the private sector in emerging markets. It is a member of the World Bank Group. IFC pledged a record $56 billion to private businesses and financial institutions in developing nations in fiscal year 2024 with the goal of reducing poverty and fostering sustainable possibilities.
