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IMF okays Nigeria’s recovery pill

The International Monetary Fund (IMF) yesterday backed the Economic Recovery and Growth Plan (ERGP) released last month by the President Muhammadu Buhari’s administration.

The ERGP is a blueprint for Nigeria’s economic recovery, growth and sustainable development.

Speaking at the ongoing IMF/World Bank Spring Meetings in Washington, the Assistant Director and Head of Fiscal Policy and Surveillance Division of the IMF, Catherine Pattillo, said the plan would tackle diversification and some of the deep-seated problems related to strengthening structures and building revenues, particularly oil revenue.

“So, we very much welcome the ERGP. As you are aware, Nigeria went into recession last year; there has been forecast recovery, but the need to address the fiscal situation is urgent. Our recommendation is for the continued fiscal consolidation. One striking statistics I think is the fact that over the past years, the ratio of interest payment to tax revenue has doubled to 66 per cent in Nigeria,” she said.

According to Pattillo, two-thirds of all tax revenue is going into interest payment, illustrating the need to raise tax revenue to allow the government implement the social and growth-friendly policies that are part of the objectives of the ERGP.

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