Nigerians Getting Poorer, IMF Tells Buhari Government
The International Monetary Fund, IMF has warned Nigeria that delay to implement reforms, incoherent policies, security issues, and tensions ahead of the 2019 general elections could have a negative impact on the nation’s economy as it could lead to a reverse of recent surge in capital inflow into the country.
Further delays in policy action including pre-election pressures can only make the inevitable adjustment of the economy more difficult and costlier, IMF said in the report on Nigeria published by news agencies.
The Fund also warned that Nigeria’s people are getting poorer despite the country’s slow recovery from recession while warning that “Comprehensive and coherent” economic policies “remain urgent and must not be delayed by approaching elections and recovering oil prices,” in its annual Article IV review of Nigeria’s economy as published by Reuters on Wednesday evening.
The Fund also urged the Central Bank of Nigeria (CBN) to discontinue direct intervention into the nation’s economy by halting injection of funds into the foreign exchange market to artificially maintain the naira exchange rate.
Instead, IMF advised CBN TO pursue a unified exchange rate.
“Higher oil prices would support a recovery in 2018 but a ‘muddle-through’ outlook is projected for the medium term under current policies, with fiscal dominance and structural constraints leading to continuing falls in real GDP per capita,” IMF said.
“CBN should discontinue direct interventions in the economy. The Central Bank of Nigeria (CBN) frequently injects hundreds of millions of dollars into the foreign exchange market to keep its own rates stable.”
“Moving towards a unified exchange rate should be pursued as soon as possible”
“(IMF) staff does not support the exchange measures that have given rise to the exchange restrictions and multiple currency practices,” the Fund said.