Nigeria Urged To Consolidate Economic Recovery

Nigeria should act urgently to
develop policies to enhance its
economic recovery, the International
Monetary Fund has said.



Following a visit by fund officials, it said
the country’s economic backdrop
“remains challenging”.



Amine Mati, IMF senior resident
representative and mission chief for
Nigeria, said:

“Economic activity
contracted in the first quarter of the year
by 0.6%, mainly as maintenance
stoppages reduced oil production.



“However, following four quarters of
negative growth, the non-oil economy
grew by 0.6% on the back of a rebound in
manufacturing and
continued strong performance in
agriculture.”



He warned that preliminary data indicated
significant revenue shortfalls for the first
half of this year, with the interest-
payments-to-revenue ratio remaining high
at 40% and projected to increase further.



High domestic bond yields and tight
liquidity continued to crowd out private
sector credit.



Mati said: “Faced with these challenges,
the government has started implementing
[an]
economic recovery and growth
plan…however, near-term vulnerabilities
and risks to economic recovery and
macroeconomic and financial stability
remain elevated.”



Growth of 0.8% this year would be
insufficient to make a dent in reducing
unemployment and poverty, he added.



Mati concluded: “Acting on an appropriate
and coherent set of policies to enhance an
economic recovery remains urgent.”