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UPDATE 1-World Bank approves $750 mln loan for Nigeria's power sector

Published 24/06/2020, 11:21
Updated 24/06/2020, 11:24
© Reuters.

(Adds details)
ABUJA, June 24 (Reuters) - The World Bank has approved a
$750 million loan for Nigeria's power sector, the first release
of funds after years of stalled talks over long-term reforms, it
said.
Nigeria's decrepit power sector has hobbled the growth of
Africa's largest economy for decades.
Problems include decaying infrastructure, mounting debts,
low tariffs for electricity and a dilapidated government-owned
grid that would collapse if all the country's power generators
operated at full tilt.
The loan will cut tariff shortfalls, protect the poor from
price adjustments, and increase power supplied to the grid, the
World Bank said in a statement late on Tuesday.
Nigeria's low tariffs, imposed by the government, have
forced the central bank to spend billions of dollars making up
the difference owed by power distributors to companies
generating electricity.
The World Bank said the aim of the loan was to help Nigeria
move away from "from highly regressive tariff shortfall
financing".
The lender often requires reforms to release funds, but it
did not say whether any conditions were tied to the money or
future tranches.

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