Lagos – The International Monetary Fund (IMF)
appeared to propose the devaluation of the Naira, among measures to resuscitate
an economy suffering the upheavals in the international oil markets.
This follows the conclusion of the 2016 Article IV Mission
The IMF team led by Gene Leon visited Abuja and Lagos during
December 14-17 and January 10–25.
“Eliminating existing macroeconomic imbalances and achieving
sustained private sector-led growth requires a renewed focus on ensuring the
competitiveness of the economy,” Leon said.
“As part of a credible package of policies, the exchange
rate should be allowed to reflect market forces more and restrictions on access
to foreign exchange removed, while improving the functioning of the interbank
foreign exchange market (IFEM).”
Also read: Channel loans to real sector, IMF advises Nigeria
Leon’s sentiments came as the Naira crashed to a record 400
to the United States currency.
That is almost double the official rate. Government has
defied calls by economists to devalue.
Leon said it would be important for the regulatory and
supervisory frameworks to ensure a strong and resilient financial sector that
can support private sector investment across production segments, including
small and medium enterprises at reasonable financing costs.
He noted staff wass supportive of the authorities’ ongoing
efforts to promote targeted and core infrastructure, reduce business environment costs through
greater transparency and accountability, promote employment of youth and female
“Steadfast implementation of structural reforms is key,”
He added adopting a sound Petroleum Industry Bill, including
by applying the Anti-Money Laundering/Combating the Financing of Terrorism
framework, would help strengthen the regulatory framework for the oil sector.
“Emphasis should be sustained on doing ‘more with less’ to
improve the efficiency of public sector service delivery and create an enabling
environment to attract investment.”
IMF said growth is projected to improve slightly to 3,2
percent in 2016 but could rebound to 4,9 percent in 2017, “supported by an
appropriate policy package that would, for example, enable priority
- CAJ News