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The International Monetary Fund (IMF) on Thursday
waded into the impasse between the executive arm of
government and the National Assembly over the 2016
budget, advising the Nigerian government to resolve the
issues surrounding the budget and have it assented to,
just as it renewed the call for the Central Bank of
Nigeria (CBN) to implement a flexible foreign exchange
regime.
IMF Managing Director, Christine Lagarde, who spoke at
the opening press briefing of the fund at the 2016
Spring Meetings of the IMF-World Bank in Washington
D.C., also told the federal government to seek
assistance from international institutions capable of
helping the Nigerian economy overcome its current
economic challenges.
“Our recommendation is that, first, Nigeria seek help
from the international institutions that can best help.
Second is that Nigeria is open-minded about using
flexibility of the exchange rate in order to absorb some
of the shocks; we believe that it’s more efficient than
using a list of forex items that are barred from being
imported into the country.
“And third, we believe that it’s really important that
budget be completely decided and approved,” Lagarde
said.
Lagarde noted that the IMF was ready to come to the
aid of Nigeria to resolve its economic issues provided
the federal government approaches it for such
assistance, recalling that during her visit to the country
in January this year, she pointedly told the government
to de-emphasise reliance on oil revenue and to diversify
the economy, especially with the lingering volatility of
oil prices.
According to her, “The low price of oil is general but
low price of oil as far as Nigeria is concerned is a critical
issue. Sixty per cent of your exports and 80 per cent of
your revenue or the other way round is actually oil
dependent.
“So when there is a massive decline in the price of oil,
those two also take a similar beating; it has a major
impact on the country.”
She believed Nigeria was “full of energy, full of smart
people” and could really transform some of its activities
in other sectors of the economy including the
agriculture sector.
In her opening remarks, she noted that “we expect
global growth this year to be at 3.2 per cent and 3.5 per
cent next year. This makes it harder to spread economic
warmth to the citizens of the globe”.
“It is not enough to lift living standards, reduce debt
and create sufficient opportunities for the nearly 200
million people around the world who are officially
unemployed and looking for jobs.
“There is a risk that middle class families and the poor
actually remain behind, which would embolden the
voices of protectionism and fragmentation,” she said.
Earlier, Word Bank President, Mr. Jim Yong Kim, pointed
out: “In the global economy, there are not many bright
spots around the world. The United States is one among
the developed countries and India is another among the
middle-income countries.
“Growth remains weak in Europe and Japan and among
emerging economies. Russia and Brazil are projected to
post, again, negative growth.
“We just downgraded our global growth forecast this
year from 2.9 per cent to 2.5 per cent. In this period of
global economic slowdown, we’re also facing major
global challenges: forced displacement, climate change,
and pandemics.
“I want to stress that each of these three represent
very clear downside risks to the global economy. We’re
not working urgently and in new ways with partners to
find solutions to these issues that affect all of us.”
Meanwhile, a bill seeking to whittle down the powers of
the Code of Conduct Bureau (CCB) and Code of Conduct
Tribunal (CCT) scaled its second reading on the floor of
the Senate yesterday.
Minister of Finance, Mrs. Kemi Adeosun (right) and the President of the World Bank, Dr. Jim Yong Kim, during the G24 Ministers meeting at the 2016 Spring Meetings of the World Bank and IMF in Washington DC
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