The International Monetary Fund (IMF) on Thursday intervened in the impasse between the presidency and the National Assembly over the 2016 budget, saying the government should resolve the issues surrounding the budget and have it assented to.
IMF also called on the Central Bank of Nigeria (CBN) to implement a flexible foreign exchange regime.
Speaking at the opening press briefing of the fund at the 2016 Spring Meetings of the IMF-World Bank in Washington D.C., IMF Managing Director, Christine Lagarde, who spoke at the opening press briefing of the fund 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.
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.”
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.”
