The Nigeria Identification for Development (ID4D) project experienced a foreign exchange gain of N8.6 billion in 2023, according to the World Bank’s recently released audited financial statement.
The financial statement stated that the devaluation of naira significantly contributed to this gain.
The ID4D project, initiated in 2020 with a budget of $430 million, aims to register all Nigerians in the National Identification Number (NIN) system. The project is supported by the International Development Association, French Development Agency, and European Investment Bank, with funding received in multiple instalments since December 2021 and more disbursements pending.
The financial report revealed that euro and dollar-denominated accounts managed by the Central Bank of Nigeria (CBN) and the National Identity Management Commission (NIMC) received funds from international financiers. Specifically, the NIMC and CBN received $2.538 million and €3.03 million, respectively, by December 31, 2023. These funds were converted to naira through the CBN Autonomous Foreign Exchange Market and deposited into NIMC’s naira drawdown accounts for the Project Implementation Unit.
“During the period, the project’s transactions were carried out in local currency. A foreign exchange gain of N8, 607,679,554.68 is recognized,” the report stated. The exchange rate for the dollar increased from N448.05 at the beginning of 2023 to N898.8 by the year’s end. Similarly, the euro exchange rate rose from N478.3 to N993.9 over the same period.
The naira’s devaluation has boosted NIMC’s funding, with current exchange rates at N1, 600/$1 and N1, 750/€. This increased funding will allow NIMC to complete several outstanding project tasks, ultimately strengthening the project’s infrastructure and efficiency. As of June 2024, the project’s disbursement rate was 37.37 percent, with only $160.7 million of the $430 million budget utilized.
To ensure the project meets its goals, the World Bank announced a restructuring and extension to 2026, as the initial conclusion date was set for June 30, 2024. This decision was made amid threats from the French Development Agency and the European Investment Bank to withdraw their funding if the World Bank ceased to be the project’s implementer.
Nigeria has faced challenges in meeting project targets, including the issuance of 148 million NINs by June 2024. As of May, the number of NINs stood at 107.34 million, according to NIMC Director-General, Mr. Abisoye Coker-Odusote.
In its July project restructuring document, the World Bank highlighted that Nigeria had yet to fulfil a key condition for additional funding disbursement. The Nigerian government must amend the NIMC Act to establish an inclusive and non-discriminatory legal framework, a requirement still pending.
Last month, the Nigerian Senate advanced a bill to repeal the National Identity Management Commission Act of 2007, passing it to the second reading stage. The proposed legislation, introduced by Deputy Senate President, Mr. Barau Jibrin, aims to enhance the efficiency and inclusivity of the country’s identity management system by aligning with global best practices and updating existing regulations.
