The details of the partnership were revealed in a joint statement issued by Hakama Sidi Ali, acting director of CBN’s Corporate Communications Department, and Hlazo Mkandawire from the IFC.
Under this agreement, the IFC, which is part of the World Bank Group, will take on currency risk management and expand its investments in the naira within key sectors of the economy, such as agriculture, housing, infrastructure, energy, small and medium enterprises, and the creative and youth economy.
The corporation aims to significantly increase its financing in these vital sectors in Nigeria, targeting over $1 billion in the upcoming years.
The agreement recognizes the necessity for local currency financing in many sectors, emphasizing that the partnership with CBN is essential for broadening access to such funding.
In a joint statement released on Monday, the institutions noted, “The 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 partnership will allow the IFC to manage currency risks and increase its investment in Nigerian naira across priority sectors,” including agriculture, housing, infrastructure, and energy.
CBN Governor Mr. Olayemi Cardoso commented on this significant agreement, stating that it will provide essential long-term local currency financing for private enterprises in Nigeria at competitive rates.
Cardoso remarked, “This collaboration signifies a major advancement in the CBN’s dedication to implementing innovative development initiatives through credible third-party service providers, moving beyond conventional intervention programs. It will act as a catalyst for economic growth and support the federal government’s efforts toward economic diversification.”
IFC Managing Director Makhtar Diop emphasized the importance of providing affordable local currency financing to small businesses in Nigeria as a vital step in stimulating the economy.
Diop stated, "Enhancing access to affordable local currency financing for small enterprises in Nigeria is critical for IFC to meet the rising demand for varied funding sources and to effectively mitigate currency risk."
"Our collaboration with the Central Bank of Nigeria will promote lending in Nigerian naira, thereby driving economic development and job creation throughout the nation."
With an investment portfolio in Nigeria totaling approximately $2.13 billion, the second largest in Africa, local currency financing remains a top priority for IFC.
The announcement further indicated that the corporation will persist in utilizing innovative financial tools and strengthening partnerships to address the increasing need for local currency financing in emerging markets.
IFC continues to be the largest global development institution dedicated to the private sector in emerging markets across 100 countries, employing its capital, expertise, and influence to foster markets and opportunities in developing regions.
In 2024, the corporation pledged a record $56 billion to private enterprises and financial institutions in developing nations, harnessing private sector solutions and mobilizing private capital to create a world free from poverty on a sustainable planet.