The International Finance Corporation (IFC), a member of the World Bank Group, has partnered with the Central Bank of Nigeria (CBN) to enhance local currency financing, aiming to unlock over $1 billion in investments across critical sectors of the Nigerian economy.
This agreement was announced in a joint press statement on Monday.
The pact, signed by IFC Managing Director Makhtar Diop and CBN Governor Yemi Cardoso, will enable naira-based financing in sectors including agriculture, infrastructure, housing, energy, small and medium enterprises, and the youth and creative industries.
“IFC and the Central Bank of Nigeria have signed an agreement to increase local currency financing to enable private businesses in Nigeria to grow and thrive. The partnership will allow IFC to manage currency risks and increase its investment in Nigerian naira across priority sectors of the economy,” the statement read.
IFC aims to significantly scale up its financing of vital sectors in Nigeria, targeting to provide over $1 billion in the coming years. Many of these sectors require local currency financing, making the IFC’s partnership with the CBN crucial for expanding access.
“Expanding access to affordable local currency financing for small businesses in Nigeria is essential for IFC to address the increasing demand for diverse funding options and to better manage currency risk,” Makhtar Diop, IFC Managing Director, said.
Diop reaffirmed the IFC’s dedication to promoting economic growth, stating, “Our partnership with the Central Bank of Nigeria will enhance lending in Nigerian naira, fostering economic growth and creating jobs across the country.”
CBN Governor, Yemi Cardoso noted that the initiative between the IFC and CBN will unlock much-needed long-term local currency financing for private businesses in Nigeria at economically viable rates.
“This collaboration marks significant progress in the CBN’s commitment to delivering innovative development initiatives through reputable third-party service providers, moving beyond traditional intervention programs. It will serve as a catalyst for economic growth and advance the Federal Government’s agenda for economic diversification,” Cardoso said.
“With an active portfolio of investments in Nigeria of up to $2.13 billion—the second highest in Africa—local currency financing is a key priority for IFC. IFC will continue to leverage innovative financial instruments and strengthen partnerships to meet the growing demand for more local currency financing in emerging markets.”
This strategic partnership is poised to bolster Nigeria’s economic landscape, providing essential support for businesses and promoting sustainable growth in a challenging economic environment. As the nation seeks to diversify its economy and enhance financial inclusion, the collaboration between the IFC and CBN marks a significant step forward in fostering a resilient and dynamic marketplace.
