The International Finance Corporation (IFC), a member of the World Bank Group, and the Central Bank of Nigeria (CBN) have announced a strategic agreement to expand local currency financing, unlocking investments of over $1 billion across key sectors of the Nigerian economy.
This development was disclosed in a joint press statement from the IFC and the CBN on Monday.
The agreement, signed by IFC Managing Director Makhtar Diop and CBN Governor Yemi Cardoso, will facilitate naira-based funding for sectors such as agriculture, infrastructure, housing, energy, small and medium enterprises, and Nigeria’s youth and creative industries.
The initiative aims to empower private enterprises by enhancing access to affordable, long-term local currency financing, which is crucial for reducing currency-related risks.
The statement read, “IFC, a member of the World Bank Group, and the Central Bank of Nigeria have signed an agreement to scale up local currency financing to empower private enterprises in Nigeria to grow and thrive.
“The partnership will enable IFC to manage currency risks and boost its investment in the Nigerian naira across priority sectors, including agriculture, housing, infrastructure, energy, small and medium enterprises, and the creative and youth economy.
“IFC intends to significantly increase its financing of critical sectors in Nigeria, targeting over $1 billion in the coming years. Many of these sectors require local currency funding, and IFC’s partnership with the CBN will be pivotal in widening access.”
Cardoso described the partnership as a “pioneering initiative” that aligns with the CBN’s push for innovative financing solutions through collaboration with esteemed international institutions. He highlighted that the initiative complements the Federal Government’s objectives to diversify the economy and drive sustainable growth.
Diop reiterated IFC’s commitment to advancing economic development in Nigeria, stating, “Expanding access to affordable local currency financing for small businesses in Nigeria is essential for IFC to meet the growing demand for diverse funding solutions and to manage currency risk more effectively.
“Our collaboration with the Central Bank of Nigeria will strengthen lending in the naira, fostering economic progress and job creation across the country.”
The statement added that, with a portfolio of $2.13 billion, Nigeria ranks as IFC’s second-largest beneficiary in Africa