The International Monetary Fund (IMF) has commenced consideration of Nigeria’s request for the release of its contribution with the Fund to enable the country confront the fiscal risks facing arising from outbreak of the COVID-19 pandemic.
IMF managing director, Ms Kristalina Georgieva, hinted in a statement yesterday that the Fund was working relentlessly to attend to Nigeria’s request so that a proposal can be considered by the IMF’s executive board as soon as possible.
The IMF Boss however did not reveal whether the Fund would release the total amount to Nigeria when the request is eventually considered for approval.
Nigeria has a contribution of $3.4bn with the IMF and it is entitled to draw up to the whole of the said amount.
Minister of Finance, Budget and National Planning, Hajiya Zainab Ahmed, had disclosed on Monday that the federal government has applied for full withdrawal of its $3.4 billion contribution with the IMF to help fight the spread of the pandemic and provide palliatives to the affected households and institutions.
“We have in the first instance applied for that maximum amount, then in the process when we negotiate we might get the maximum amount or less but that is the amount of our contribution with the IMF. This will not be tied to any conditionality. However, it is important to clarify that Nigeria does not intend to negotiate or enter into a formal programme with the International Monetary Fund at this time, or in the foreseeable future,“ Ahmed noted.
Acknowledging receipt of the request and confirming that the Fund was processing it, the IMF MD yesterday noted that Nigeria’s economy was endangered by the Coronavirus scourge and the drop in global crude prices.
She said, “Nigeria’s economy is being threatened by the twin shocks of the COVID-19 pandemic and the associated sharp fall in international oil prices. President Buhari’s administration is taking a number of measures aimed at containing the spread of the virus and its impact, including by swiftly releasing contingency funds to Nigeria’s Center for Disease Control and working on an economic stimulus package that will help provide relief for households and businesses impacted by the downturn.
“To support these efforts, Nigeria’s government has requested financial assistance under the Fund’s Rapid Financing Instrument (RFI). This emergency financing would allow the government to address additional and urgent balance of payments needs and support policies that would make it possible to direct funds for priority health expenditures and protect the most vulnerable people and firms. We are working hard to respond to this request so that a proposal can be considered by the IMF’s Executive Board as soon as possible.”
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