The International Finance Corporation (IFC) says it has signed an agreement with the Central Bank of Nigeria (CBN) to increase local financing to enable private businesses to grow and thrive.
IFC is a member of the World Bank Group.
In a statement on Monday, IFC said the goal of the partnership is to provide more than $1 billion in financing in coming years.
The corporation added that through the collaboration, it can manage currency risks and increase its investment in the naira, across priority sectors of the economy.
According to the statement, the sectors include agriculture, housing, infrastructure, energy, small and medium enterprises (SMEs) and the creative and youth economy.
IFC added that it has an active portfolio of investments in Nigeria of up to $2.13 billion — the second highest in Africa — and local currency financing is a key priority.
“IFC aims to significantly scale up its financing of critical sectors in Nigeria, with a goal of providing more than $1 billion in the coming years,” the statement reads.
Speaking on the deal, Makhtar Diop, IFC managing director, said the partnership aims to address funding options.
“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,” Diop said.
“Our partnership with the Central Bank of Nigeria will enhance lending in Nigerian naira, fostering economic growth and creating jobs across the country.”
On his part, Olayemi Cardoso, governor of the CBN, said the agreement will go a long way to improving the country’s economic growth.
“This pioneering initiative between the IFC and CBN will unlock much-needed long-term local currency financing for private businesses in Nigeria at economically viable rates,” Cardoso said.
“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.”
IFC also said it will continue to leverage innovative financial instruments and strengthen partnerships to meet the growing demand for more local currency financing in emerging markets.
