Nigeria in Talks to Borrow $3.5 Billion as Oil Saps Budget

Nigeria’s government is in talks for concessionary loans worth $3.5 billion from the World Bank and African Development Bank to help finance a planned record budget this year, Finance Minister Kemi Adeosun said.

While discussions are going on, a formal request hasn’t yet been made to the World Bank for $2.5 billion and the AFDB for $1 billion, Adeosun said by telephone on Sunday. The government plans to tie them to specific capital projects, she said. A request hasn’t been made for assistance from the International Monetary Fund.

Lawmakers in Nigeria’s parliament will begin deliberations this week on the record 6.1 trillion naira ($30.7 billion) 2016 spending plan, she said. Nigeria depends on oil for almost all exports and two-thirds of government revenue, and public finances are being squeezed amid a 7 percent drop in crude prices this year.

Adeosun said non-deal roadshow meetings with investors to sound out a potential sale of $1 billion of Eurobonds will start in February. Nigeria has issued dollar bonds twice, most recently in 2013.

The West African nation’s economy probably grew 3.2 percent last year, the slowest pace since 1999, according to a Bloomberg survey of economists.