The Federal Republic of Nigeria is in the process of seeking approval from the World Bank to restructure $650 million from the Nigeria Improved Child Survival Program for Human Capital (ICSPHC) within its broader agenda to reform the health sector with the goal of lowering the under-five mortality rate from132 per 1,000 live births in 2018 to 79 per 1,000 live births by 2030. A “Restructuring Paper” on the ICSPHC noted that the restructuring was based on findings from a mid-term review of the project that recommended refinements to better align the project with Nigeria’s reforming health sector, especially regarding child and maternal health.
Also, the document outlined proposed changes, including a level-two restructuring of the Immunization Plus and Malaria Progress by Accelerating Coverage and Transforming Services Project (IMPACT P167156), which forms the first phase of the ICSPHC multiple phase programmatic approach (MPA). The restructuring would update components and costs, re-allocate funds across disbursement categories, change the Results Framework so that progress could be better tracked and reported. This would be the second restructuring of the IMPACT Project that underwent a previous restructuring in July 2021 that had involved financing the Construction of the Lagos Vaccine Hub.
October 2023 Mid-Term Review drives Nigeria’s health project shift.
Additionally, the October 2023 Mid-Term Review (MTR) was a key driver in facilitating this item of restructuring as it renewed recognition of what shifts needed to be made from the government’s position to the management of the health sector, and legitimate steps necessary to perform that obligation. Following considerable dialogue with the World Bank, the formal request was made through a letter dated 26 March, 2024. The restructuring involves several significant changes to the project design and implementation.
Although the project has been rated moderately satisfactory, the government of Nigeria intends to shift funds within the disbursement categories, allowing Basic Health Care Provision Fund (BHCPF) to expand to additional states. This is to increase the availability of basic health services to more states, particularly to areas where health indicators are among the poorest. The government’s view is also to modify the results framework for the project to use alternative sources of data, including the Multiple Indicator Cluster Surveys (MICS), to strengthen aspects of monitoring and evaluation. Some activities may be eliminated, including a possible centralized procurement of Long-Lasting Insecticidal Nets (LLINs) and other malaria-related commodities.
Country’s World Bank debt rises by $1.07b under Tinubu govt.
Individual states will be responsible for their procurement processes. This is expected to speed the process of malaria prevention tools to the states and to the broader higher level of reduced under-5 mortality. The restructuring also includes an addition of a new sub-component to enhance secondary health facilities and workforce training. This was intended to improve the capacity of the health system. In earlier reports released by Nairametrics, the Nigerian government is negotiating with the World Bank for a $500 million Loan to Finance the recently approved Health Sector Renewal Investment Initiative (HSRII). This request for funding is part of Nigeria’s comprehensive strategy to tackle the significant health issues facing the country.
Since President Bola Tinubu’s government, Nigeria’s borrowing from the World Bank has increased by $1.07 billion. Nigeria has borrowed $4.95 billion from the World Bank, sparking further concerns about rising costs to service Nigeria’s external debt. The World Bank is also expected to approve four new loan projects for Nigeria in 2024, amounting to $2 billion. As of March 31, Nigeria’s debts to the World Bank amounted to $15.59 billion, according to the Debt Management Office (DMO).
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In sum, Nigeria’s $650 million World Bank loan restructuring under the ICSPHC acts as an indication of the country’s seriousness in addressing key health challenges-one of which is decreasing under-five mortality. The changes proposed in the restructuring process will ideally help to improve the project’s impact by re-allocating resources, making improvements to the monitoring structure with states, and transferring procurement authority to the states. In addition to being consistent with overall health sector reforms, these recommendations demonstrate the government’s innovative response to changing conditions. However, the restructuring is occurring in a context of increasing External Debt for Nigeria, which raises key questions related to fiscal Sustainability of its actions.