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LAGOS/ABUJA, Dec 10 (Reuters) - The World Bank needs Nigeria
to strengthen reforms of its currency, the naira, before it can
approve a $1.5 billion loan, its country director said on
Thursday.
Nigeria needs the support to survive low oil prices and make
it through the economic shock of the COVID-19 pandemic.
World Bank loans are often contingent upon reforms, and its
officials said previously it was "recommending" a more unified,
flexible exchange rate. The Nigerian naira hit 500 per dollar on
the black market last month as a dollar scarcity squeezed the
economy. "We recognize how much Nigeria has done," Shubham Chaudhuri,
the World Bank's Nigeria country director, said during a webinar
with journalists. "There needs to be a little bit more."
Nigeria's central bank devalued the official rate by 15% in
March and weakened the foreign exchange rate for exchange
bureaux in November and in March. But the gap between the official rate and the parallel
markets remains large. The situation is pressuring the economy
and making it difficult for private companies to get the dollars
they need to import into Nigeria. A Central Bank official
previously told Reuters it also could cause remittances to slow
and exporters could refuse to repatriate their proceeds.