Economic reforms: Nigerians now understand the need for our reforms — Tinubu
…Seeks IMF support for economic stability, reduce hardship
…Your loan burden is bone-crushing, hurting Nigerians — Atiku tells Tinubu
President Bola Ahmed Tinubu has asserted that Nigerians now understand the importance of the reforms spearheaded by his administration.
Recall that President Tinubu during his inauguration speech had declared an end to fuel subsidy and announced other reforms subsequently that have sparked controversies amongst Nigerians.
The reforms have gone on to contribute to increased inflationary pressures and hardships with the President describing the reforms and period as pains before childbirth.
Speaking on Wednesday night in Rio de Janeiro, Brazil, when the Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, paid him a courtesy call on the sidelines of the G20 Leaders’ Summit, President Bola Tinubu assured that his administration will continue prioritising the welfare of the poor and most vulnerable even as the economic reforms bear fruit.
While acknowledging that the reforms had weakened Nigerians’ purchasing power, President Tinubu said his administration will continue to provide social safety nets to cushion the unintended consequences.
Congratulating the IMF Chief on her election for a second term in office, President Tinubu appreciated her support in implementing the reforms, calling for more institutional backing for stability and sustainable growth.
“We have started seeing positive results from our reforms, and the Nigerian people now understand the need for them, but we have to reduce the hardship that has resulted from the implementation.
He emphasised the critical need for educational access.
“We have too many children out of school, and we know that education is a way out of hunger and poverty. That is why we are designing ways and incentives to keep these children in school, and we need your support for these kids who want to stay in school,” he told the IMF chief.
President Tinubu stressed that substantial resources must be invested to stimulate the much-needed infrastructural development in the country.
The President further noted that Nigeria is working on tax reforms to stimulate the economy further.
“We are engaging stakeholders and sensitising Nigerians to expand the economy’s tax base for inclusive developmental growth. We are doing this without necessarily increasing the taxes on our people who have already given a lot. We will require your support on this.”
In her remarks, the Managing Director, who expressed a desire to visit Nigeria, commended the Tinubu administration’s economic reforms and their positive indicators.
She assured the President of further support in diversifying the Nigerian economy.
She specifically lauded the social investment programmes as a way of cushioning the effects on the most vulnerable and promised the assistance of the body in this regard.
Contrary to popular perception, she said that the IMF is focused on developing vulnerable societies and devoting substantial resources to emerging economies.
The Managing Director expressed the Fund’s readiness to offer technical support for the budgeting process, adding that it will assist Nigeria in achieving the best possible results from loans.
Georgieva said the world had suffered some shocks from the pandemic that caused damage to world economies. Over the last two years, the IMF has injected about $1 trillion into the world economy.
While the developed countries managed the shocks better, the developing nations did not do so, she noted.
She said the IMF is working with developing countries to build resilient institutions to better manage future global economic shocks.
She stressed that it is the right of every country to benefit from the Fund after a critical analysis of its priorities.
The IMF Managing Director informed President Tinubu that the organisation’s Executive Board has approved the 3rd Chair for Sub-Sahara Africa (SSA), enhancing the African voice.
She congratulated Nigeria on hosting the IMF’s African Caucus meeting in Abuja in August.
Georgieva also advocated for deepening regional economic ties, ensuring the IMF is ready to support this process.
Meanwhile, Former Vice President Atiku Abubakar has criticised President Bola Tinubu over the country’s economic downturn, accusing him of worsening the situation with his heavy reliance on loans.
In a statement, Atiku described the loan burden as “bone-crushing” and warned that it is stifling the economy and negatively impacting the lives of ordinary Nigerians.
Atiku, in a statement he personally signed on Thursday, cited a recent World Bank report showing Nigeria as the third most indebted country to the International Development Association (IDA).
The former vice president was reacting to Tinubu’s fresh loan request of $2.2bn (N1.7trillion) approved by the Senate on Thursday.
Atiku said what made the latest loan more concerning was the fact that it is benchmarked at the exchange rate of 1 USD to N800, whereas the current exchange rate from the Central Bank of Nigeria stands at over N1,600 to 1 USD.
According to the statement, “The recent report released by the World Bank, showing Nigeria as the third most indebted country to the International Development Association (IDA), is very concerning
“These Tinubu’s loans are bone-crushing to Nigerians and bring insufferable pressure on the economy, especially when they are not properly negotiated and utilised.
“This report is coming just when the government has already sent a proposal to the National Assembly signalling an intention to borrow an additional N1.7tn being shortfall in the 2024 budget through Euro Bonds.
“What makes this particular loan proposal even more concerning is that it is benchmarked at the exchange rate of 1 USD to N800, whereas the current exchange rate from the Central Bank of Nigeria stands at over N1,600 to 1 USD.
“Nigeria is sinking further in debt, and the National Assembly has become an accomplice once more.
“Tinubu had, in July this year, boasted that the FIRS and Customs under his watch have collected all-time high revenues to finance the budget.
“Why then are they still borrowing? There is something that they are not telling Nigerians, even as they are being crushed by a combination of their failed trial-and-error policies and loan rackets.
“These Tinubu’s loans are bone-crushing to Nigerians and bringing insufferable pressure on the economy, especially when they are not properly negotiated and utilised.
“It is concerning that the voracious appetite for these humongous loans is powered by corruption and not for infrastructure and development needs.
“A report by Budgit, a budget watchdog, has disclosed that the 2024 budget is a mess because of the level of pork associated with it.
“I feel a sense of personal agony seeing that just a few years after the administration of President Obasanjo took our country out of foreign indebtedness, we are today back at the top spot in the same conundrum.
“It is time that we apply more caution and apply arithmetic to the loan frenzy,” the statement read.
The presidential candidate of the Peoples Democratic Party (PDP) in the 2023 election said it’s time the administration applied more caution and arithmetic to the loan frenzy.
