Nigeria to Deploy $460 Million World Bank Loan for Nationwide Fibre Broadband Infrastructure

Nigeria is set to invest $460 million from a $500 million concessional loan provided by the World Bank into the development of a nationwide fibre-optic broadband network, marking a major step in strengthening the country’s digital infrastructure and internet connectivity.

The funding is part of a financing agreement between the Federal Government and the International Development Association, the World Bank’s concessional lending arm, under the Building Resilient Digital Infrastructure for Growth project. The initiative is aimed at expanding access to high-quality, climate-resilient broadband services, particularly in underserved and unserved areas across the country.

Under the agreement, about 92 percent of the loan will be used to capitalise a newly proposed fibre infrastructure company that will deploy approximately 90,000 kilometres of broadband fibre nationwide. The remaining $40 million will support goods and works procurement, consulting and non-consulting services, capacity building, operational expenses, and reimbursement of preparatory costs incurred during project development.

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The proposed company will operate as an independent special-purpose vehicle structured as a joint venture, with majority private-sector ownership and management. Its core mandate will be the phased deployment of climate-resilient fibre infrastructure and the provision of wholesale, open-access broadband services to licensed telecommunications operators.

The Federal Government will participate as a shareholder through its investment management entity but will hold no more than a 49 percent equity stake, ensuring that private investors retain majority ownership and operational control.

The $460 million equity investment will be released in four tranches, each tied to clearly defined operational and performance milestones. The first tranche of $150 million will be disbursed once the company is formally incorporated, private partners are selected through an approved process, and governance documents are finalised.

A second tranche of $100 million will follow after the adoption of approved fiduciary and administrative systems and the completion of at least 5,000 kilometres of fibre deployment. The third tranche, also valued at $100 million, will be released upon the construction of an additional 20,000 kilometres of network infrastructure.

The final tranche of $110 million will be disbursed after the company launches wholesale open-access services through a published reference offer and completes a further 40,000 kilometres of fibre rollout. By this stage, at least 65,000 kilometres of fibre infrastructure must have been deployed before the final equity drawdown is approved.

Once released, each tranche is required to be transferred to the company’s designated account within five working days, underscoring the equity-based structure of the financing rather than traditional budgetary spending.

Project implementation will be overseen by the Federal Ministry of Communications, Innovation and Digital Economy, while the Ministry of Finance will receive progress reports twice a year. A dedicated Project Implementation Unit will manage daily operations, with financial oversight handled by the Federal Project Financial Management Department under the Office of the Accountant General of the Federation.

Beyond fibre deployment, the project includes technical assistance to government agencies to enhance broadband usage in targeted areas. It also provides funding for project management, monitoring and evaluation, environmental and social safeguards, grievance redress mechanisms, and independent audits.

The agreement places strong emphasis on environmental and social compliance, requiring adherence to an Environmental and Social Commitment Plan and the establishment of accessible grievance mechanisms for affected communities, alongside strict reporting obligations to the World Bank.

Repayment of the concessional credit will commence in October 2030, with Nigeria repaying 2.5 percent of the principal every six months until April 2050. The loan attracts a concessional interest rate based on the reference rate plus a variable spread, reduced by 250 basis points.

The World Bank approved the $500 million loan in October 2025 as part of efforts to significantly expand broadband access nationwide. The overall project is estimated to cost $1.6 billion, with the World Bank contribution complemented by private-sector financing.

The fibre rollout forms part of a broader national digital infrastructure strategy aimed at strengthening Nigeria’s internet backbone and maximising the capacity of existing submarine cables already landed in the country. The project is expected to expand the national fibre network from approximately 35,000 kilometres to over 125,000 kilometres when completed.

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Additional funding commitments include support from other multilateral development institutions and private investors, reflecting growing confidence in Nigeria’s digital economy potential.

As Nigeria continues to expand its portfolio of development-financed projects, the World Bank remains its largest external creditor, accounting for a significant share of the country’s external debt. The fibre infrastructure investment is expected to play a critical role in driving economic growth, digital inclusion, private-sector investment, and job creation across the telecommunications and technology ecosystem.