Nigeria is set to receive a 600 million US dollar loan from the African Development Bank to aid with its budget deficit.
AfDB approved the loan on Wednesday to help finance Nigeria’s Economic Governance, Diversification and Competitiveness Support Program.
The 600 million US dollar loan is the first tranche of a 1 billion dollar budget support loan.
The last tranche of 400 million dollars will be approved next year.
The funds will aid the Nigerian government to create fiscal space to facilitate a smooth implementation of the budget, support fiscal and structural reforms.
They will also assist the country’s efforts to rapidly build a buffer of foreign exchange reserves, which will contribute to easing pressure on the foreign exchange market and stabilize the Naira.
According to AfDB, Nigeria’s success in its efforts to achieve macroeconomic stability and economic recovery would signal the end of the current recession.
The West African nation is currently undergoing its worst financial crisis for decades due to a slump in oil revenues.
With government spending exceeding 400 billion naira this year, the government has been struggling to fund its record 30 billion dollar budget.