The International Monetary Fund has said stalled per- capita growth, poverty and high food instability have aggravated the ongoing cost- of- living extremity in Nigeria.
The report came amid rising affectation, exchange extremity, weak profitable growth and business shutdowns.
The global lender said this in a new report named ‘ IMF Executive Board Concludes Post Financing Assessment with Nigeria. ’
According to the report, low profit collection has hampered the provision of services and public investment.
It noted that caption affectation reached 27 percent time- on- time in October( food affectation 32 per cent), reflecting the goods of energy subvention junking, exchange rate deprecation, and poor agrarian product in the country.
The report read in part, “ Nigeria faces a delicate external terrain and wide- ranging domestic challenges.
External backing( request and functionary) is scarce, and global food prices have surged, reflecting the impacts of conflict and geo- profitable fragmentation.
“Per- capita growth in Nigeria has stalled, poverty and food instability are high, aggravating the cost- of- living extremity.
Low reserves and veritably limited financial space constrain the authorities ’ option space. Against this background, the authorities ’ concentrate on restoring macroeconomic stability and creating conditions for sustained, high and inclusive growth is applicable.
”Amid Nigeria’s current profitable difficulties, the report noted that on January 12, 2024, the Executive Board of the International Monetary Fund concluded the Post Financing Assessment and championed the Staff Appraisal on a lapse- of- time base.
It added that Nigeria’s capacity to repay the IMF is acceptable.
The IMF also expressed sanguinary that the new administration had made a strong launch, diving deep- confirmed structural issues in grueling circumstances. incontinently, it espoused two policy reforms that its forerunners had nestled down- videlicet energy subvention junking and the junction of the sanctioned exchange rates.
It added, “ The new CBN platoon has made price stability its core accreditation and demonstrated this resoluteness by dropping its former part in development finance.
On the financial side, the authorities are developing an ambitious domestic profit mobilisation docket.
”According to data from the Debt Management Office, Nigeria presently owes the IMF the sum of $2.8bn.
The Federal Government, in its 2024 budget plans to spend about N8.2tn on debt servicing. Professional services establishment, Price water house Coopers in a new report, advised that Nigeria’s rising debt service cost might affect the country’s debt servicing capability, credit standing outlook and borrowing cost.
PwC said debt service could rise from N8.25tn in 2024 to N9.3tn in 2025 and further to N11.1tn in 2026.
“With a high debt servicing to profit rate, the government aims to increase domestic debt in 2024 to meet its deficiency backing conditions, ” the report read in part.