Nigeria’s cabinet approved plans by the government to seek a $1.5 billion loan from the World Bank, Finance Minister Wale Edun said.

The funding will be concessionary and is expected to be secured by December, Edun told reporters in the capital, Abuja, on Monday. The West African nation will also seek $80 million of financing from the African Development Bank, he said.

Nigeria is seeking funding as it implements a series of economic reforms to accelerate economic growth and support the more than 40% of its 200 million people who live in poverty. Over the past eight years, the nation’s debt has increased almost eight-fold to more than $110 billion, and servicing those obligations consumed 96% of government revenue in 2022.

The reform initiative by President Bola Tinubu “is being rewarded by processing for Nigeria $1.5 billion of immediate financing,” Edun said. “Provided that we do everything on our own side, it will be in before the end of the year.”

The International Monetary Fund has welcomed Nigeria’s reforms, which include unifying the nation’s various exchange rates and removing a costly gasoline subsidy, and said it’s prepared to help the government.

“As every member country of the IMF, Nigeria can seek IMF financing if they see this as helpful to address external imbalances,” the Lagos-based Punch newspaper quoted the fund as saying. “The Nigerian authorities have not approached the IMF with a request for financing.”

Bloomberg