Nigeria’s government is seeking approval from lawmakers to borrow $1.3 billion from international lenders to fund the newly licensed Development Bank of Nigeria, a spokesman for the lower chamber of parliament said on Wednesday.
The bank aims to support small businesses with loans of varying lengths at lower interest rates than are currently available as Africa’s largest economy contends with its first recession in 25 years.
The loan money is made up of $500 million from the World Bank, $450 million from the African Development Bank, $200 million from German state bank KfW and $130 million from France’s state development agency.
The cabinet last month approved the loans for the bank, but the loan facility is still subject to approval by the National Assembly.
A letter seen by Reuters stated that the loan facility was “inadvertently omitted” from an external borrowing plan that requires approval by lawmakers.
“It has been referred to the relevant committee on foreign loans. This is an addendum to the earlier requests by the president for loan approval,” said Abdulrazaq Namdas, a spokesman for the House of Representatives.
“It’s an addendum to be accommodated in the 2016 to 2018 borrowings that are awaiting the approval of the National Assembly,” he said.
The finance ministry has previously said that 50 percent of the gross domestic product in Nigeria’s economy is made up of small companies.
The central bank approved the development bank’s licence in March, Reuters reports.