Adedapo Adesanya
By Adedapo Adesanya
The Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, has called for more concessional debt, saying such support is vital for Nigeria in alleviating exchange rate pressures.
Mr Edun, who was represented by the Director-General of the Budget Office of the Federation, Mr Ben Akabueze, at the G-24 Ministers press briefing at the ongoing International Monetary Fund-World Bank Spring Meetings in the US, stated that the Nigerian economy was steering in the right direction with the recent policies being undertaken by the present government.
Responding to a question on Nigeria’s debt stance and how to manage it sustainably on Tuesday, he said, “For Nigeria, we faced fiscal challenges but most significantly by getting debt sustainable and at the same time increasing fiscal space for our ever-increasing burden of public expenditure, especially with sustained high population growth.
“So, the most important support that Nigeria requires at this time is investment and increased trade. While Official Development Assistance (ODA) is helpful at the end of the day, that’s not what’s going to sustainably address the scale of Nigeria’s problems.
“There are a lot of investment opportunities, especially in areas like infrastructure. At the same time, of course, concessionary debt and support still remain important for the country, especially foreign currency-denominated for one it helps also with addressing the foreign currency supply situation that puts pressure on the exchange rate.”
“You can see inflation is high and is being tackled, we see inflation beginning to peak and we can see a reversing trend towards the second half of this year.
“The exchange rate is stabilised now, we have seen the parallel and the foreign exchange market rates merge. I think that all of these are inspiring greater confidence in investors, whether it be portfolio investors, foreign direct investors, and even domestic investors as well,” Mr Akabueze said at the briefing.
The Naira has found support in the FX market easing to post-devaluation levels following a surge in cost. The sustained gain in recent times has been attributed to the policy thrust of the Central Bank of Nigeria (CBN) including the clearing of overdue FX backlogs, injection of funds into banks and approved sellers, as well unorthodox moves in conjunction with other bodies to clamp down on speculators and hoarders.
There have been calls for more improved input from the fiscal operators to support the efforts of the monetary authorities.
