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Nigerian President Muhammadu Buhari's government has approved the creation of a company to , with around $2.6 billion in initial financing.

slipped into recession in its third quarter for the second time in four years, hit by the coronavirus pandemic and a , and faces a huge infrastructure deficit.

"It is envisaged that, over time, the entity will grow to 15 trillion ($39.3 billion), in assets and capital," a spokesman for Vice President Yemi Osinbajo said in a statement on Friday.

The company, Infra-Co, will be one of the top infrastructure finance entities in Africa and will be wholly dedicated to infrastructure development, the statement said.

Infra-Co will operate as a public-private partnership and will be initially funded by the Central Bank of Nigeria, the Nigerian Sovereign Investment Authority and the Africa Finance Corporation.

It will focus on developing public assets and reconstruction as well as new roads, rail, power and other key infrastructure sector projects.

The IMF expects Nigeria's economy to contract by at least 3 percent this year, a situation many fear will further deepen the country’s infrastructure crisis and worsen an economy with the impact of the pandemic.

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Nigeria's senate last year approved nearly $23 billion (18.9 billion euros) in foreign loan requests by Buhari to support a series of large-scale projects, which the government hopes will revamp the country’s crumbling infrastructure.

Buhari early this week also launched a $1.96 billion rail project linking to neighbouring Niger as the country looks to boost its growth.

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