Wednesday, October 23, 2024 - Despite surging borrowing costs, Nigeria
continues to maintain a strong presence in the global debt market, according to
the International Monetary Fund (IMF).
During a press briefing at the IMF/World Bank annual meetings in
Washington DC, Tobias Adrian, the IMF's Financial Counsellor, noted that
Nigeria and other frontier markets have been active in the debt market
throughout 2024, despite financing costs being significantly higher than
pre-2021 levels.
“Frontier markets, including Nigeria, have been active in the debt
market this year. Though access to financing is more expensive, overall
issuance levels have remained encouraging,” Adrian stated.
The IMF also expressed support for Nigeria’s recent monetary policy
initiatives, including interest rate hikes and foreign exchange reforms led by
the Central Bank of Nigeria (CBN). These measures, designed to stabilize the
economy, were praised as essential steps in curbing inflation, which remains
close to 30 percent. Adrian emphasized that the CBN’s shift towards inflation
targeting and liberalization of the exchange rate is helping mitigate the
impact of rising inflation, worsened by recent natural disasters such as
floods.
In addition, the IMF has revised its economic growth forecast for
Nigeria, projecting a slowdown in 2024 due to persistent inflationary pressures
and ongoing economic challenges.
At the same conference, Nigeria’s Minister of Finance and Coordinating
Minister of the Economy, Wale Edun, held strategic discussions with IMF
Managing Director Kristalina Georgieva. According to a statement from the
finance ministry, talks focused on Nigeria’s economic reform agenda under
President Bola Tinubu’s administration and the progress made so far. Edun is
advocating for increased international support and concessional financing to
sustain these domestic reforms, which aim to strengthen economic resilience and
improve living standards.
During the G-24 leaders’ news conference, Edun also called for
concessional loans from the IMF and World Bank to support Nigeria’s reform
programs. He stressed the importance of affordable financing in cushioning the
poor and vulnerable from the immediate costs of economic adjustments while
promoting long-term macroeconomic sustainability.
In a separate session, CBN Governor Yemi Cardoso is expected to lead a discussion on strengthening ties with Nigerians in the diaspora, focusing on ways to boost remittance inflows to help shore up foreign exchange reserves amid Nigeria’s fiscal challenges.
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