World Bank Coordinator Warns States Against Debt Waste
Assad Hassan, the national coordinator for the World Bank-backed HOPE Governance Programme, has issued a sharp rebuke to Nigerian state governments regarding the use of concessional loans. He warns that states must build robust institutions rather than view international funding as a temporary windfall. Reform cycles often stall once external capital dries up. Nigeria now risks repeating this cycle of abandoned projects if officials fail to internalize these gains. States must transform financial support into lasting systemic change.
The HOPE programme targets essential sectors like basic education and primary healthcare to improve service delivery outcomes. Hassan rightly questions the legacy of previous initiatives like the SFTAS programme, which many states seemingly discarded once the incentives arrived. Receiving funds is easy. Maintaining the underlying reforms is hard. This distinction remains the ultimate test for subnational governance across the country.
Nigeria currently carries a heavy burden as the third-largest borrower within the International Development Association portfolio. Debt to this World Bank arm reached $18.7bn by the end of 2025. This figure represents an 11.3 per cent rise from the previous year. Such high levels of exposure demand rigorous accountability from those in power. Borrowing without building is a recipe for fiscal disaster.
The World Bank now employs a Programme-for-Results model to force accountability onto participating states. This structure ties funding directly to measurable outcomes and workforce capacity building. Ikechukwu Nweje, the lead of the bank’s task team, insists that technical support will continue for those who show results. Consultants will assist with implementation, but they cannot manufacture political will. Ownership must come from within the state capitals.
Governors must view these loans as tools for structural improvement rather than budgetary gaps. Sustainable reform requires more than just meeting donor milestones for a quick payout. It demands a shift in how states manage their own public institutions. Success is not found in the loan agreement. It is found in the systems that remain long after the cash ends.
The Enugu State government received praise during the support mission for progress in its education and health sectors. Such successes show that reform is possible when local leadership aligns with broader objectives. However, isolated pockets of competence cannot substitute for national progress. State officials have a responsibility to turn these examples into a wider standard. The era of waste must end.