The Federal Government has asked the World Bank and African Development Bank (ADB) for $3.5bn in emergency loans to fill a growing gap in the 2016 Budget in the latest sign of the economic damage being wrought on the country by tumbling crude prices, the Financial Times of London has reported.

The request from President Muhammadu Buhari’s government is intended to help fund a $15bn state deficit, which has been deepened by a hefty increase in public spending as the West African country attempts to stimulate a slowing economy.

It comes as concerns grow over the impact of low oil prices on petroleum exporting economies in the developing world.

Finance minister Kemi Adeosun told the Financial Times recently that she was planning Nigeria’s first return to bond markets since 2013. But Nigeria’s likely borrowing costs have been rising alongside its budget deficit. A projected deficit of $11bn, or 2.2 per cent of gross domestic product, had already risen to $15bn, or 3 per cent, as a result of the recent turmoil in oil markets.

The $2.5bn loan from the World Bank and a parallel $1bn loan from the ADB, which would enjoy below-market rates, must still be approved by both banks’ boards. Under World Bank rules its loan would be subject to an IMF endorsement of the government’s economic policies and bank officials say they would have to be confident the Nigerian government was undertaking significant structural reforms. But both loans would carry far fewer conditions than one from the IMF, which does not believe Nigeria needs a fully fledged international bailout at this point.

“I think we all agree that Nigeria is facing significant external and fiscal accounts challenges from the sharp fall in…oil prices, as of course are all oil exporters,” Gene Leon, the IMF’s representative in Nigeria, told the Financial Times.

•Photo shows Finance Minister Kemi Adeosun.