¢Says 84% of previous loans yet to be disbursed

The Director-General of the Lagos Chamber of Commerce and Industry (LCCI), Dr Chinyere Almona, has called for transparent and efficient disbursement of the World Banks newly approved $500 million under the Community Action for Resilience and Economic Stimulus Programme.

Urging the government to ensure the funds reach the intended beneficiaries, Almona said a robust monitoring and evaluation framework must be established to track the impact of the fund and prevent misallocation.

She added that the development comes at a crucial time when the country grapples is mounting economic challenges, including inflationary pressures, declining purchasing power and burdensome debt profile.

While this intervention is aimed at supporting poor and vulnerable households and firms, its broader implications on businesses and the economy pose a concern to the business community.

The loan’s direct impact on small businesses and vulnerable populations, through grants and livelihood support, presents a potential short-term stimulus. It can enhance food security and community resilience, mitigating the effects of economic hardship at the grassroots level, she said.

The LCCI DG said the broader macroeconomic effects of the facility must be carefully considered.She expressed worry over Nigerias rising debt burden, particularly given the slow pace of disbursement and implementation of previously approved loans. She noted that with the World Banks share of Nigerias external debt reaching $17.32 billion, the question of debt sustainability and ability to pay back become is real.

If not efficiently managed, she said, additional borrowing could exacerbate fiscal vulnerabilities, weaken investors confidence and limit the government’s ability to execute long-term economic reforms.

From a business perspective, while targeted stimulus programmes can offer temporary relief, structural economic challenges such as inadequate infrastructure, multiple taxation, and FX volatility remain unaddressed.

Businesses require a stable operating environment, and while social welfare programs are essential. They must be complemented by policies that foster productivity, investments and job creation, she said.

Given that just 16 per cent of previously approved World Bank loans under this administration have been disbursed, Almona said the new approval raises questions about the absorptive capacity of relevant institutions and the risk of funds being underutilised or mismanaged.

To maximise the loans benefits while mitigating associated risks, she urged the government to adopt a prudent debt management strategy, prioritising concessional financing and ensuring that borrowed funds are tied to projects with clear economic returns.

We also urge the strengthening of domestic revenue generation through tax reforms and expanding the productive base of the economy, which can reduce reliance on external borrowing.

Beyond short-term palliatives, the government must implement structural reforms that create a conducive business environment. Policies should focus on improving infrastructure, ensuring policy consistency and addressing FX challenges to support private sector growth and attract investment, she said.

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