Nigeria plans to borrow $945 million (N160.7 billion) from the International Development Association (IDA), an arm of the World Bank, to fund irrigation and drainage projects in the country.
$495 million out of the planned debt is meant for irrigation projects in Kano, Sokoto and Zamfara States, while $250 million is meant for urban water projects in Bauchi, Ekiti and Rivers states, and $200 million to improve drainage in Ibadan.
Nigeria can repay the loan over the next 20 years at an interest rate of 1.25 percent and a service cost of 0.75 percent, the minister disclosed.
Once irrigation technology can be put in place, Nigeria will be able to have “year-out year-in farming season,” said Yuguda.
The loan is part of the country’s effort to expand other revenue sources, as it seeks to diversify its economy.
Global oil prices have continued to drop, going below $80 in the past one week. The situation have put Nigeria’s economy at risk, with the country now looking to fall back on its Excess Crude Account, should oil prices fall below the $78 benchmark being set for next year’s budget.