WASHINGTON Feb 23 – The International Monetary Fund on Thursday urged Nigeria to step up its economic reform efforts before the opportunity for reforms becomes more limited.
“Urgency is needed in implementing a coherent and credible package of monetary, fiscal and structural policies as the window for bold reforms is closing as the 2019 elections are approaching fast,” IMF spokesman Gerry Rice said at a regular news briefing with reporters.
Rice also confirmed that the Nigerian authorities have not approached the global lender about a program but said the IMF “stands ready to help should the country make a request for financial assistance.”
China ,World Bank Loan for Railway projects
Nigeria wants to borrow at least $1 billion from the World Bank and to sign within months for a $1.3 billion loan from China to fund railway projects, Finance Minister Kemi Adeosun said on Tuesday.
Africa’s biggest economy needs to plug a gap in its record 7.3 trillion naira ($23.17 billion) 2017 budget, which boosts capital expenditures by a quarter to end its first recession in 25 years due to low oil prices.
The government has been in talks with the World Bank for a year and wants to finalise this month a reform proposal necessary for a loan application, according to officials.
“We expected to borrow at least $1 bln dollars,” Adeosun told CNBC when asked about the talks with the Washington-based bank.
“There is also some possibility of doing sector specific intervention in the power sector, they are working very closely with us on power,” she added, without being more specific.
Nigeria had initially promised to submit an economic plan to the World Bank by the end of December but did not do so, sources told Reuters last month.
Meanwhile Naija247news recalled that Nigeria’s finance minister Kemi Adeosun has ruled out getting a loan from the International Monetary Fund (IMF), saying the IMF loan may be unnecessary at this time when the country’s non-oil revenue profile was increasing.
The government said it would rather concentrate on developing home-grown solutions to its fiscal problems.
Minister of Finance, Kemi Adeosun, who disclosed this in an interview, said though the IMF loan is not bad, Nigeria does not need the fund’s borrowingprogramme and would rather pursue its own economic reform plan.
She said the federal government was aware that the IMF loan programme was a topic of “huge national debate,” but the country sees IMF as its last resort.
“For us, the IMF is really lender of last resort when you have balance of payments problem. Nigeria doesn’t have balance of payments problems per se, it has a fiscal problem, which is that major revenue source has lost so much value,” Adeosun told CNBC Africa.
The minister further pointed out that the government was already carrying out some of those reform programmes the IMF would have requested it to do.
“What IMF does for you is that it gives you programmes for reforms, we are already doing as much reform as any IMF programme would impose on Nigeria.
“Nigerians want to take responsibility for their future. We must have our home-grown, home-designed programme of reform, that Nigerians take ownership for, because they are painful reforms.
“When you go through this type of adjustment of your economy, these reforms are very painful, and they have to be home-grown. We have to take responsibility for this ourselves, so that when it succeeds, Nigerians would say; yes, we did this.
“I am not saying the IMF are bad, but I’m saying right now, we don’t see that need. We feel this is a problem Nigerians created and Nigerians will solve,” she explained.
Adeosun also told CNBC that Nigeria hoped to sign in the next few months a loan worth $1.3 billion from China’s Export-Import Bank (Exim) to fund railway projects in the West African nation.
Naija247news recalls that Nigeria is in talks with the World Bank to secure a loan for which the financial body requested an economic recovery plan. The plan, according to government, is scheduled to be released this month.