Federal Government Seeks $500m World Bank Loan to Enhance Rural Infrastructure
The Federal Government is seeking a $500 million loan from the World Bank to improve rural road infrastructure and enhance agricultural marketing across the country. This initiative aims to address the critical need for better connectivity in rural Nigeria, where 92 million people currently lack access to reliable roads.
The loan request is outlined in the final draft of the Resettlement Policy Framework for the Nigeria Rural Access and Agricultural Marketing Project Scale-Up (RAAMP-SU), spearheaded by the Federal Ministry of Agriculture and Rural Development.
The RAAMP-SU project is designed to improve rural access and climate resilience, thereby boosting agricultural potential and marketing prospects for agrarian communities, ultimately contributing to better livelihoods for the rural populace. Key objectives of the project include enhancing rural access and climate resilience in served areas, strengthening institutional capacity for rural road network management, and solidifying the financial and institutional foundations for sustainable management of rural and state road networks.
This initiative is an extension of the earlier Rural Access and Agricultural Marketing Project, supported by the World Bank and the French Development Agency. The project is managed by the Federal Department of Rural Development within the Federal Ministry of Agriculture and Rural Development, under the oversight of the Federal Project Management Unit.
The policy document highlights Nigeria’s extensive road network, which includes approximately 194,000 kilometres of roads—34,000 kilometres of federal roads, 30,000 kilometres of state roads, and 130,000 kilometres of registered rural roads. Despite this network, the rural accessibility index for Nigeria stands at a mere 25.5 per cent, leaving approximately 92 million rural inhabitants without connectivity.
The document states, “Rural access is particularly restricted in areas densely populated by the economically disadvantaged. These factors underscore the imperative to expand and enhance the rural road network, as well as conserve rural road and transport assets.”
The total cost of the RAAMP-SU project is estimated at $600 million, with the World Bank expected to provide 83.33 per cent of the required funding. This commitment is 79 per cent higher than the initial $280 million commitment for the parent project.
The project will finance three key components: Improvement of Resilient Rural Access ($387 million), Climate Resilient Asset Management ($158 million), and Institutional Strengthening and Project Management ($55 million).
States wishing to participate in the project must have a fully functional Roads Fund and Roads Agency with appointed boards and staff, as well as provisions for administrative costs in the state budget. The RAAMP-SU’s funds will be allocated on a competitive basis among states, considering a refined socioeconomic selection matrix to increase rural access to basic services and promote food security.
The policy framework mandates the implementation of resettlement and compensation plans as a prerequisite for project activities that cause resettlement, ensuring that necessary measures are in place before any land acquisition or restriction of access.
