The World Bank has approved a 750
million dollar International Development Association (IDA) credit for Nigeria’s
Power Sector Recovery Operation (PSRO) to improve electricity supply.
The Bank made this known in a
statement in Abuja on Wednesday, adding the target was to also achieve
financial and fiscal sustainability and enhance accountability in Nigeria’s
power sector, NAN reports.
It explained that about 47 percent
of Nigerians did not have access to grid electricity and those who had access,
faced regular power cuts.
According to the bank, the
economic cost of power shortages in Nigeria is estimated at around 28 billion
dollars, which is equivalent to two percent of its Gross Domestic Product
(GDP).
It stated that getting access to
electricity was one of the major constraints for the private sector according
to the Ease of Doing Business report.
The statement quoted Shubham
Chaudhuri, World Bank Country Director for Nigeria, as saying “lack of reliable
power has stifled economic activity and private investment and job creation.”
”This is ultimately what is needed
to lift 100 million Nigerians out of poverty.
“The objective of this operation
is to help turn around the power sector and set it on a fiscally sustainable
path.
This is particularly urgent at a
time when the government needs all the financial resources it can marshal to
help protect lives and livelihoods amid the COVID-19 pandemic,” he added.
The bank also said that PSRO would
provide results-based financing to support the implementation of the
Government’s Power Sector Recovery Programme (PSRP).
It further explained that the PSRP
was a comprehensive program to restore the power sector’s financial viability,
improve service delivery, and reduce its fiscal burden.
“The PSRO is expected to increase
annual electricity supplied to the distribution grid, enhance power sector
financial viability while reducing annual tariff shortfalls, and protecting the
poor from the impact of tariff adjustments.
“This will enable the turnaround
of the power sector while helping the Federal Government to redirect large
fiscal resources from highly regressive tariff shortfall financing towards
critical crisis-responsive and pro-poor expenditures.
It will also increase public
awareness about ongoing power sector reforms and performance.
“Specifically, the PSRO will
ensure that 4,500 MWh/hour of electricity is supplied to the distribution grid
by 2022 by strengthening the regulatory, policy, and financing framework.
“It will also enhance the
accountability and financial viability of the sector, helping the sector create
a track record of sustainable operation necessary for unlocking much needed
private investments in the future,” the statement read.
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omg!!!!! all these borrowings dey fear person ooo
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