Nigeria has asked the World Bank and the African Development Bank for $3.5bn in loans to plug a growing gap in its budget, it was widely reported on Monday.
The request from the government of President Muhammadu Buhari, elected eight months ago on an anti-corruption ticket, is reported to be intended to help fund a $15bn state deficit, which has been deepened by aggressive public spending as the government acts to stimulate the slowing economy.
Ridle Markus, Africa strategist at Absa Capital, told ANA it was not surprising that Nigeria was looking at alternative sources of funding.
“Like other oil producers, Nigeria’s fiscal situation has deteriorated markedly with the decline in oil revenues. With its strategy to revive economic growth by adopting a more expansionary fiscal stance, it was inevitable that they would be looking at alternative funding sources to help them achieve this objective,” Markus said.
The Financial Times of London quoted Nigerian Finance Minister Kemi Adeosun as saying on Sunday that the loans were not emergency measures but rather the “cheapest way possible” to fund a deficit.
– African News Agency (ANA)
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