Nigeria Has Not Approached Us for Debt Restructuring, Says World Bank President THISDAYLIVE: Nigeria
The World Bank president said this just as Minister of Finance Budget and National Planning, Mrs. Zainab Ahmed, yesterday recanted, saying the country was not seeking debt restructuring, but was looking at options, including how to buy back some of its bonds.
Ahmed had said:"We have been engaging financial institutions to look at the opportunity to restructure our debt to further stretch the debt service period to give us more fiscal relief. Those are some of the things we want to achieve in this meeting." The Common Framework deals with insolvency and protracted liquidity problems, along with the implementation of an IMF-supported reform program.
"So, the challenge for Nigeria is that the subsidies are so large that they undermine the revenues coming to the government from the state-owned oil company. Nigeria is actually in a concerning situation because the increase in the oil prices that occurred earlier this year actually ended up hurting the finances of Nigeria because of that large subsidy that's provided."
But in her contributions during a 'Debate on the Global Economy,' which featured the IMF Managing Director, Kristalina Georgieva; a renowned Egyptian-American economist and businessman, Mohamed Aly El-Erian; among others, Ahmed explained:"We are actually feeling the pressure, the market costs are too high for us to come out.
In her remarks during the session, the IMF Managing Director said:"When you see the dark clouds on debt financing, don't wait. Look at ways in which you can extend maturities, you can improve the matching of currency obligations with what you are earning yourself. In that sense, what Nigeria is doing in this current environment is exactly what you should be doing."
"In all, 345 million people are acutely food insecure. What it means is that there are children and women and men are at risk of dying because of hunger."Meanwhile, Emefiele has predicted that inflation rate in the country would decelerate. He added:"We are delighted that people are beginning to see that these tightening effort would yield results. For us, 17 per cent looks good, but we believe that with what we are doing at the monetary policy, that our tightening effort would help to control demand and effectively lead to a further reduction below 17 per cent."
"We cannot be accused of not doing what they want which is to take decisions on how to handle the exchange rate management. We are going to be looking at them and even be thinking of the right time to do what they are suggesting, otherwise if you do it exactly when they want, it may turn out to be very hurtful to the Nigerian economy.
"Going forward, we must make sure that our dependence on oil and gas and even as we move and transit as a country and as a people, there must be a resolve on our path that this God-given resources are protected and used for the benefit of our people.
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