Massive Jubilation As Powerful International Bodies Back Buhari, Set To End Recession

By Joshua Amaugo October 7, 2016 12:04

Massive Jubilation As Powerful International Bodies Back Buhari, Set To End Recession

‎In a bid to help the Nigerian economy away from economic recession, the International Monetary Fund, IMF, has offered to grant loans to the President Muhammadu Buhari-led Federal Government, and other countries facing economic crisis, in order to stimulate growth.

The development is coming at a time, when the IMF had forecast a negative Gross Domestic Growth, GDP, for Nigeria, predicting that the recession might stay longer.

The IMF said, ‎”Nigeria’s economy is forecast to shrink 1.7 percent in 2016, and South Africa’s will barely expand”.‎

Related:‎ Shock As IMF Blows Hot, Makes Dangerous Prediction On Nigeria’s Economy

‎The ‎Managing Director, IMF, Christine Largade, in a bid to extend its olive branch to Nigeria had on Thursday, October 6, in Washington DC, United States, at the ongoing Annual Meeting of the World Bank/IMF said, “If we want to improve the inequality issue, we must have a strong international safety net.”

She added: “In this context, I am pleased to reveal that our board recently approved the extension of the zero interest rate on all concessional facilities from 2016 to 2018, and thereafter, if there is a need for an extension.”

According to Financial Experts, the decision of the IMF is highly commendable, most especially at a time when Nigeria needs to borrow to spend in its way out of recession.

According to Punch, a Senior Nigerian Official who spoke in anonymity, reacting, said, “The IMF people have been talking to us for some time, asking us to come and take loans, but their facilities come with too many unfavorable conditions.

“For instance, they told us to remove fuel subsidy and devalue the Naira, which we did.

“If we take their fresh offer, they may ask us to raise the price of fuel, and further devalue the currency, but these will create unrest in the country, because the people are already suffering, and we are aware of this.

“We will rather take a facility from the World Bank. The IMF facility comes with too many conditions; though we need a lot of funds to come into our economy now, we have to be wary of some of the tough conditions attached to them,”‎ the Official said.

‎Giving further details about the facility, the IMF Boss said, “That is really important for low-income countries to be able to actually absorb the shocks, without necessarily going to the international markets, or relying on bilateral lending capacity of close to $1tn, by extending access to bilateral borrowing agreements.

“The new agreements that are being signed this week will run at least through the end of 2019, and will continue to serve as a third line of defence.

“As you know, the first line of defence is quota; the second line is a new arrangement to borrow; and the third line of defence will be those bilateral loans.

“We have so far received pledges of $344bn from 26 members. We look forward to others joining the effort. We will provide more details shortly; and there will be some signing sessions organised in the course of the next two days”.