IMF: Three things Nigeria must do to boost economic growth

The International Monetary Fund (IMF) has asked the Nigerian government to implement a minimum of three reforms to boost the country’s economy.

Abebe Selassie, IMF director of African department, spoke on Thursday at a virtual briefing on economic outlook for Sub-Saharan Africa.

Nigeria exited recession with a 0.11 percent growth in the fourth of 2020.

IMF had projected growth of 2.5 percent for Nigeria in 2021 from 1.5 percent announced in January.

The Washington-based institution also forecast a growth of 3.4 percent for the Sub-Saharan Africa region in 2021, up 0.2 percent from the previous forecast.

Selassie said reforms are needed in the area of fiscal space and energy sector to boost growth in the economy.

“In the case of Nigeria, ensuring that the country enjoys its tremendous potential requires reforms in three areas in our view,” he said.

“First and foremost, more fiscal space needs to be created through domestic revenue mobilisation, investments in health, education, and infrastructure which Nigeria expressly needs.

“Second, good reform in the energy sector is going to be paramount. Cost of doing business is very high on account of the inefficiencies of the energy sector, power supply, cost of highly inefficient and hurtful use of generators in the country can hinder power supply. Getting policies to make sure that Nigeria resolves this case once and for all is also paramount.

“Third, macroeconomic policy calibration, involving the foreign exchange market will be really important.”