25:I[95528,["8320","static/chunks/41ade5dc-90c252cb9fc58faa.js","4514","static/chunks/4514-c6f7fd4243ca1382.js","8500","static/chunks/8500-e4dd1cb1bb626827.js","5772","static/chunks/5772-d567479163a90457.js","5435","static/chunks/5435-aeb0c97bbd6a1e26.js","581","static/chunks/581-ddacfe5584430cec.js","2576","static/chunks/2576-2302c7e93f25ab96.js","5103","static/chunks/app/blog/post-blog/%5Bslug%5D/page-90992d1d58394cd0.js"],"default"] 26:Tb60,

So, Who Cancelled the Loan? Was it the World Bank or Nigeria?

First, what was this loan for?

The Power Sector Recovery Program was designed to fix Nigeria's electricity sector; make distribution companies more efficient, reduce losses, improve billing, and eventually get to a point where the government wasn't constantly bailing out the power sector. The World Bank had approved the money. But the money hadn't been paid out yet, that's what "undisbursed" means. The loan was sitting there, waiting for Nigeria to meet certain conditions.

Nigeria asked the World Bank to cancel it on March 26, 2026. Now the $717.7 million is gone. The program's closing date was moved from June 2027 to May 31, 2026, more than a year earlier.

Why did Nigeria cancel it?

The official reason isn't fully stated, but the context matters. The power sector is in crisis. Tariffs don't cover costs. Distribution companies are struggling. The naira devaluation has made everything more expensive. It's possible Nigeria realized it couldn't meet the conditions attached to the loan. Or that the loan terms no longer made sense after the currency shifted. Either way, canceling a loan means the government won't have to repay $717.7 million plus interest. But it also means the money won't be available for power sector fixes.

Even though one cannot entirely rule out corruption and misappropriation as reasons the loan was cancelled.

WHAT THIS MEANS FOR YOU AS A BUSINESS OWNER

If you run a business that depends on electricity, which is almost every business, this is not good news. The power sector needed that money. Without it, improvements may come more slowly. The Lagos 24/7 power franchise zones (planned for October 2026) are separate state-level initiatives. But national grid improvements may stall further. My take. $717.7 million is real money.

But in the context of Nigeria's challenges, it's not a game-changer by itself. The bigger question is why conditions weren't met. What went wrong? Was it poor planning? Policy shifts? Or simply unrealistic targets? Canceling a loan you can't use is better than borrowing money you can't repay. But it's also an admission that things aren't working.

The power sector remains Nigeria's single biggest constraint on economic growth. This cancellation doesn't help.

--------------------------

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