Nigeria plans to use $460 million, or about 92 percent of a $500 million World Bank loan, to capitalize a fiber infrastructure company set up to roll out 90,000 kilometers of climate-resilient broadband fiber across the country.
This is part of a financing agreement between the federal government and the International Development Association, the concessional lending arm of the World Bank, for projects that build resilient digital infrastructure for growth.
Under the agreement, the World Bank approved a $500 million concessional loan to support Nigeria’s efforts to expand access to high-quality, climate-resilient broadband internet in unserved and underserved areas.
Of this amount, $460 million will be specifically earmarked for capital raising and capitalization of new project companies to advance fiber optic deployment. The remaining $40 million will be used to reimburse supplies, construction, consulting and non-consulting services, training, operating expenses and reserves used to develop the project framework.
According to the document, the proposed project company is a company “to be established as an independent, majority privately owned and managed special purpose vehicle joint venture with the objective of deploying 90,000 kilometers of climate-resilient fiber infrastructure according to a phased approach. Limited to the provision of wholesale open access services to licensed telecommunications carriers and the management of related investments, including carrying out preparatory activities and providing transaction advisory services, providing equity financing to the project and capitalizing the project.” ”
The federal government will participate as a shareholder in the company through the Ministry of Finance, which will manage the government’s investment interests. However, the agreement explicitly limits the government’s shareholding to a maximum of 49%, ensuring that the company remains majority private.
The $460 million equity injection will be divided into four tranches tied to rigorous performance and operational milestones. The first tranche of $150 million will be released after the project company is set up as a joint venture with a private partner selected through a World Bank-approved process and the memorandum of association, articles of association, and shareholding agreement are approved.
The second tranche of $100 million will only be paid after the company has adopted lender-approved trustee and administrative procedures and completed at least 5,000 kilometers of fiber deployment. The third tranche of $100 million relates to the completion of a further 20,000 kilometers of network construction.
The final tranche of $110 million was released after the company launched extensive open access services through a published reference offer and completed an additional 40,000 kilometers of fiber deployment, bringing the total deployment distance to at least 65,000 kilometers before final capitalization.
Once each tranche is withdrawn, the contract requires the funds to be transferred to the project company’s dedicated account within five business days, indicating the capital nature of the financing rather than a traditional budgetary expenditure.
The project will be implemented under the supervision of the Federal Ministry of Communications, Innovation and Digital Economy, and the Federal Ministry of Finance will receive semi-annual progress updates.
A dedicated project implementation unit manages day-to-day execution, and overall financial management is handled by the Federal Project Financial Management Division of the Office of the Comptroller General.
Beyond fiber deployment, the project also includes technical assistance to federal agencies to support the use of high-quality broadband in targeted areas, as well as funding for project management, monitoring and evaluation, environmental and social protection measures, grievance redress mechanisms, and independent audits.
The agreement focuses on environmental and social standards and requires compliance with an environmental and social commitment plan. It also mandates the establishment of a grievance mechanism available to affected communities and strict reporting requirements to the World Bank.
Repayment of the credit will begin in October 2030, with Nigeria repaying 2.5% of the principal every six months until April 2050. The credit is subject to a preferential interest rate set at the base rate plus a variable spread minus 250 basis points.
Sunday Punch further reported that the World Bank approved a $500 million loan for Nigeria to build resilient digital infrastructure for growth on October 6, 2025, to significantly increase broadband access in the country’s underserved and underserved areas.
The total cost is estimated at $1.6 billion, with the World Bank contributing $500 million through a concessional loan from the International Development Association, while the remaining funding will come from the private sector.
In May 2024, The Punch reported that the federal government had approved a special purpose vehicle to support the delivery of an additional 90,000km of fiber optic cable for universal internet access across Nigeria.
An SPV is an independent legal entity created to accomplish a specific goal or project. In this context, the SPV will manage the fiber optic project and oversee its implementation, finance and operations.
Bosun Tijani, Minister of Communications, Innovation and Digital Economy, said in a statement that the project will strengthen the national backbone for internet access and optimize the use of the eight submarine cables already in place in Nigeria.
Mr. Tijani also announced that in August 2025, Nigeria is close to building the largest digital backbone in the developing world. He presented the technical design for Project BRIDGE, a $2 billion fiber optic expansion initiative that will extend Nigeria’s broadband network from 35,000 kilometers to over 125,000 kilometers.
The deployment plan includes seven major fiber rings connecting Lagos with six of Nigeria’s geopolitical zones, as well as 37 city-level fiber loops, 77 regional networks, and multiple edge data centers.
“For the past two years, we have been working tirelessly on Project BRIDGE, perhaps the most ambitious and foundational digital infrastructure project in Nigeria’s history,” Tijani said.
Previously, it was revealed that the implementation of BRIDGE will be carried out through a special purpose vehicle in which the federal government will hold a 51% stake and private investors will hold 49%. However, the financing agreement limits the government’s shareholding to 49%.
Apart from the World Bank contribution, $200 million in funding has been pledged from the African Development Bank, as well as investments from the European Investment Bank, the Islamic Development Bank and various private companies.
The BRIDGE loan is an addition to Nigeria’s growing portfolio of World Bank-supported programs. According to the Debt Management Bureau, as of June 30, 2025, Nigeria’s external debt was $46.98 billion.
The World Bank Group remains Nigeria’s largest single creditor, accounting for $19.39 billion of the total, including $18.04 billion from IDA and $1.35 billion from IBRD. This represents 41.3 per cent of Nigeria’s external debt, underscoring the bank’s key role in financing Nigeria’s development initiatives.
