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COVID-19: IMF considering Nigeria’s financing request
The Managing Director of the International Monetary Fund, Kristalina Georgieva says the fund is working hard to respond to Nigeria’s request so that a proposal can be considered by the IMF’s Executive Board as soon as possible. Nigeria’s Minister of Finance, Budget and National Planning, Zainab Ahmed had disclosed that Nigeria had applied to IMF’s Rapid Credit Facility. Kyari Bukar, Former Chairman of the Nigeria Economic Summit Group joins CNBC Africa more.
Wed, 08 Apr 2020 12:50:39 GMT
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AI Generated Summary
- The importance of securing external financing for COVID-19 response and providing essential palliatives to individuals and businesses impacted by the lockdown
- The need to balance leveraging international financial support with preserving Nigeria's sovereign wealth fund and fiscal stability
- The imperative of adopting a coordinated monetary and fiscal approach, investing in key sectors, and preparing for a potential global recession
As the global economy grapples with the unprecedented challenges posed by the COVID-19 pandemic, countries around the world are exploring various financing options to mitigate the economic repercussions of the crisis. One such country at the forefront of this battle is Nigeria, which has recently applied for financial assistance from the International Monetary Fund (IMF) to combat the impact of the lockdown measures on its economy.
In a recent interview on CNBC Africa, Kyari Bukar, Former Chairman of the Nigeria Economic Summit Group, shed light on Nigeria's efforts to source funding for COVID-19 response and outlined key priorities for the country's economic strategy.
One of the primary concerns raised by Bukar is the urgent need for financial support to provide necessary palliatives to individuals and small and medium enterprises affected by the lockdown. With the economy facing significant budgetary shortfalls, the request for assistance from international financial institutions such as the IMF, the African Development Bank, and the World Bank is crucial to bolstering Nigeria's fiscal resilience.
Bukar also emphasized the importance of leveraging external financing without depleting Nigeria's sovereign wealth fund, which serves as a vital resource for future stability. Given the current economic downturn and the depletion of reserves, it is imperative for Nigeria to strike a balance between utilizing external funding and preserving its long-term financial security.
Furthermore, Bukar highlighted the necessity for a coordinated monetary and fiscal approach to address the economic challenges posed by the pandemic. He underscored the importance of adopting expansionary fiscal policies to stimulate growth and advocated for a moratorium on debt repayments to provide breathing space for the economy.
Looking ahead, Bukar emphasized the need for strategic investments in healthcare, education, and infrastructure to enhance Nigeria's self-sufficiency and reduce dependency on imports. By fostering a conducive environment for domestic and foreign investments, Nigeria can position itself for sustainable economic growth in the post-pandemic era.
While the specter of a global recession looms large, Bukar acknowledged the inevitability of a recession in Nigeria but stressed the importance of timely interventions to mitigate its impact. He pointed out that the duration and severity of the recession would depend on global factors and the effectiveness of containment measures.
In conclusion, Bukar urged policymakers to learn from the current crisis and adopt proactive measures to build resilience against future economic shocks. By implementing prudent financial strategies and promoting domestic production, Nigeria can navigate the turbulent waters of the COVID-19 crisis and emerge stronger in the aftermath.
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