Maggie Fick in Lagos and Shawn Donnan in Washington

Plans by the Nigerian government to borrow billions of dollars from the World Bank and other international lenders to plug its budget deficit have run into delays amid a stalemate over reforms, jeopardising the country’s ability to finance its budget.
Nigeria’s plight is emblematic of the growing problems facing commodity-exporting countries in the developing world in the wake of the collapse in oil and other commodity prices in recent years, a subject that will be heavily discussed at this week’s annual meetings of the International Monetary Fund and World Bank in Washington.

Mongolia on Friday became the latest example of those woes when it lodged a formal request for a bailout from the IMF, joining countries such as Angola and Suriname that have been driven to seek help this year.

Nigeria is heading towards its first full-year economic contraction in a quarter of a century, due in part to the slow and widely criticised response to the oil price collapse by the administration of President Muhammadu Buhari. Meanwhile, militant attacks in the oil-producing Delta have slashed foreign earnings further, stoking severe foreign exchange shortages.

The naira has lost 40 per cent of its value since June, when the central bank abandoned a currency peg at the behest of the IMF and other lenders concerned at the pace at which the government was burning through foreign exchange reserves.

But Abuja is now facing calls from the IMF and World Bank to push through further reforms. These discussions have held up any agreement on a loan from the bank, said people briefed on the talks.

They added that the World Bank had said it would not be able to disburse any loans until 2017 at the earliest because it “has not yet received the macroeconomic framework” needed for the discussions to progress, though the finance ministry disputes that.

Mr Buhari was elected last year on a promise to tackle corruption but has struggled to manage Africa’s largest economy and stave off the deep fiscal crisis. Underlying that has been his deep aversion to the IMF, with which he clashed in the 1980s when he ran the country as a military ruler before he was toppled in a coup amid a public outcry over conditions set by the fund in a bailout.

Mr Buhari said in a speech at the weekend that the government had spent 720.5bn naira ($2.3bn) on capital projects this year to get the economy moving again.

The World Bank said it was “continuing its discussions” with Nigeria “on a range of critical reforms for restoring macroeconomic resilience” and “would determine, with the government, the most appropriate instrument to support the reform programme”. It did not give a timeline for those discussions, which are expected to continue on the sidelines of the World Bank and IMF meetings in Washington.

“Although recent measures, including the adjustment of fuel prices and the move toward more flexibility in the foreign exchange market, are welcome, more are needed to ensure sustained economic benefits,” Gene Leon, the IMF’s mission chief for Nigeria, said in a statement to the Financial Times.

Nigeria needs to “reduce domestic and external imbalances” and provide “greater clarity” on its macroeconomic policy direction, he added.

Finance minister Kemi Adeosun told the FT in April that Nigeria planned to secure external financing for a shortfall now estimated at 1.8tn naira by the end of the third quarter. She said last week that discussions with the bank were ongoing.

There have been some signs of progress. Akinwumi Adesina, president of the African Development Bank, last week said he would go to the lender’s board in October to seek approval for a $1bn loan to help cover Nigeria’s deficit.

Meanwhile, senior politicians and businesspeople, including Aliko Dangote, Africa’s richest man, have said Nigeria has no choice but to sell state-owned assets to raise capital and avoid a prolonged fiscal crisis.

https://www.ft.com/content/4ed37f18-8885-11e6-8cb7-e7ada1d123b1?ftcamp=published_links%2Frss%2Fhome_us%2Ffeed%2F%2Fproduct

flyingsnail:
Maggie Fick in Lagos and Shawn Donnan in Washington

Plans by the Nigerian government to borrow billions of dollars from the World Bank and other international lenders to plug its budget deficit have run into delays amid a stalemate over reforms, jeopardising the country’s ability to finance its budget.
Nigeria’s plight is emblematic of the growing problems facing commodity-exporting countries in the developing world in the wake of the collapse in oil and other commodity prices in recent years, a subject that will be heavily discussed at this week’s annual meetings of the International Monetary Fund and World Bank in Washington.

Mongolia on Friday became the latest example of those woes when it lodged a formal request for a bailout from the IMF, joining countries such as Angola and Suriname that have been driven to seek help this year.

Nigeria is heading towards its first full-year economic contraction in a quarter of a century, due in part to the slow and widely criticised response to the oil price collapse by the administration of President Muhammadu Buhari. Meanwhile, militant attacks in the oil-producing Delta have slashed foreign earnings further, stoking severe foreign exchange shortages.

The naira has lost 40 per cent of its value since June, when the central bank abandoned a currency peg at the behest of the IMF and other lenders concerned at the pace at which the government was burning through foreign exchange reserves.

But Abuja is now facing calls from the IMF and World Bank to push through further reforms. These discussions have held up any agreement on a loan from the bank, said people briefed on the talks.

They added that the World Bank had said it would not be able to disburse any loans until 2017 at the earliest because[b] it “has not yet received the macroeconomic framework” needed for the discussions to progress, though the finance ministry disputes that.[/b]

Mr Buhari was elected last year on a promise to tackle corruption but has struggled to manage Africa’s largest economy and stave off the deep fiscal crisis. Underlying that has been his deep aversion to the IMF, with which he clashed in the 1980s when he ran the country as a military ruler before he was toppled in a coup amid a public outcry over conditions set by the fund in a bailout.

Mr Buhari said in a speech at the weekend that the government had spent 720.5bn naira ($2.3bn) on capital projects this year to get the economy moving again.

The World Bank said it was “continuing its discussions” with Nigeria “on a range of critical reforms for restoring macroeconomic resilience” and “would determine, with the government, the most appropriate instrument to support the reform programme”. It did not give a timeline for those discussions, which are expected to continue on the sidelines of the World Bank and IMF meetings in Washington.

“Although recent measures, including the adjustment of fuel prices and the move toward more flexibility in the foreign exchange market, are welcome, more are needed to ensure sustained economic benefits,” Gene Leon, the IMF’s mission chief for Nigeria, said in a statement to the Financial Times.

Nigeria needs to “reduce domestic and external imbalances” and provide “greater clarity” on its macroeconomic policy direction, he added.

Finance minister Kemi Adeosun told the FT in April that Nigeria planned to secure external financing for a shortfall now estimated at 1.8tn naira by the end of the third quarter. She said last week that discussions with the bank were ongoing.

There have been some signs of progress. Akinwumi Adesina, president of the African Development Bank, last week said he would go to the lender’s board in October to seek approval for a $1bn loan to help cover Nigeria’s deficit.

Meanwhile, senior politicians and businesspeople, including Aliko Dangote, Africa’s richest man, have said Nigeria has no choice but to sell state-owned assets to raise capital and avoid a prolonged fiscal crisis.

https://www.ft.com/content/4ed37f18-8885-11e6-8cb7-e7ada1d123b1?ftcamp=published_links%2Frss%2Fhome_us%2Ffeed%2F%2Fproduct

The link get k leg

Na wailers link

What happened to the recovered loots, TSA and savings from subsidy removal?

So,who IMF epp?

More like the refusal of the government to become IMF /World Bank Mugu

Who IMF /World Bank epp?
Good question.
Nobody.
Apart from investment bankers in New york,London,Frankfurt and Paris

Useless government

oduastates:
More like the refusal of the government to become IMF /World Bank Mugu

Who IMF /World Bank epp?
Good question.
Nobody.
Apart from investment bankers in New york,London,Frankfurt and Paris

Shut the hell up, you ignoramus.
Deceiving yourself with pseudo-nationalism like 90% of African dictators and their pathetic citizens.
The world bank is the one doing the rejecting here because Nigeria is not viable. Your govt wants to borrow, but world bank says NO.

Nigeria is currently not creditworthy. Her only viable option is to sell national assets to super rich politicians or front as dangote at awarawa tomatoes prices.

There's no economic policy let alone framework, Buhari cannot give what he doesn't have.

I pity those who think General Cassandra has anything to offer

They should not give us not even a dollar. Let government battle this recession by collecting all stolen money from looters. The money stolen in the last administration brought Nigerian to this present state so if this present administration cannot recover all stolen money, make this country just die make everybody rest. What is it sef!

sarrki:


The link get k leg

Na wailers link

Are you talking about the famous Financial Times?

It is not even the fact that Nigeria is broke that is the problem, It is that there is no micro-economic policy coming from the Federal government that the world bank can trust .

BekeeBuAgbara:
Are you talking about the famous Financial TImes?

Why are you replying a zombie with a negative IQ.?

d economy is like Buhari.....

[size=14pt]

They want to borrow and chop the money

IMF and World Bank have become responsible organizations that won't just dole out money they know kworrupt politicians will simply share amongst themselves and debit Nigeria with the debt.[/size]

I thought world Bank already gave their verbal commitment for whatever loan they promised. Also, why is IMF part if this story? I thought we passed on IMF because of their high covenants and high rates.

It looks like our leaders have box themselves in a corner, they will now be forced to accept IMF expensive loan and also be forced to accept all the restrictions that comes with it including famous "EPA" agreement. God help us

What does Osinbajo know about micro economic policies as the head of Economic team.

Instead of heading a committee on political and constitutional reforms to restructure the country s contained in APC manifesto, he went and accepted a portfolio he knows nothing about.

Buhari thinks that since the constitution stipulates that the Vice President heads the National Economic Team (NEC) where the 36 Governors are members is the same thing as Federal Government's Economic team responsible for micro-economic and fiscal policies hence the choice of Prof. Osinbajo. What a pathetic decision!

Wailer kaiiii

The link says IMF delayed

The op said IMF reject


Abeg shey big difference no dey between delay and reject..


The co travellers who don't read before comment already rushing for their daily likes and shares

CSTR2:
Shut the hell up, you ignoramus.
Deceiving yourself with pseudo-nationalism like 90% of African dictators and their pathetic citizens.
The world bank is the one doing the rejecting here because Nigeria is not viable. Your govt wants to borrow, but world bank says NO.

The IMF should stick their money up their a**.
And you, I have nothing to say.
Your diagnosis is on file since 1967

Awo on Africa's Dependence on Former Colonial Masters

"Today, Africa is a continent of COMPETING BEGGAR-NATIONs. We vie with one another for favours from our former colonial masters; and we deliberately fall over one another to invite neo- colonialists to come over to our different territories to preside over our economic fortunes ... Unless a beggar resolutely shakes off, and irrevocably turns his back on, his begging habit, he will forever remain a beggar. For, the more he begs, the more he develops the beggar characteristics of lack of initiative, courage, drive and self-reliance."
-Address to 4th OAU Summit in Kinshasa (1967): In Voice of Courage, 1981.

/

Mr Buhari was elected last year on a promise to tackle corruption but has struggled to manage Africa’s largest economy and stave off the deep fiscal crisis. Underlying that has been his deep aversion to the IMF, with which he clashed in the 1980s when he ran the country as a military ruler before he was toppled in a coup amid a public outcry over conditions set by the fund in a bailout.


Even Oyibo remember!!!!


Casandra casandra casandra


How many times did I call u?

CSTR2:
Shut the hell up, you ignoramus.
Deceiving yourself with pseudo-nationalism like 90% of African dictators and their pathetic citizens.
The world bank is the one doing the rejecting here because Nigeria is not viable. Your govt wants to borrow, but world bank says NO.

Don't mind them. There is no shortage of ignoramuses who, at the sight of the words "IMF" or "World Bank", rush to spout the same old nonsense like Pavlov's dogs, despite not having the first clue about what's under discussion. These idiots fail to realize that the likes of IMF and the World Bank are lenders of last resort, who countries only turn to when they are shut out of global bond markets through their lack of creditworthiness.

Nigeria's current credit rating is 5 notches below investment grade, and as such the only alternative to adopting the sensible measures being demanded by the IMF and World Bank is to go without any loans whatsoever: this course of action will cause a level of suffering which would make the strictest IMF conditions look like child's play.

At least some of us on here are old enough to realize that this worst case has actually happened before, back in 1985 when Babangida turned down IMF loans, yet was still forced by economic realities to implement the policies the IMF had recommended. In other words, ignorant "nationalist" posturing by the know-nothing Nigerian masses forced the country into suffering the pain associated with reform without even getting the benefit of the lending the reform was supposed to justify!

CSTR2:
Well, they are not giving you money, so tell your govt to stop begging from them.
Awolowo is the last person to give me leadership lesson. A war criminal .

You made a fine argument earlier, and then you decide to piss away your credibility by indulging in a blatantly tribalistic ad-hominem. What a pity that so many Nigerians let themselves down through such base displays of prejudice and illogic such as this.

/

CSTR2:
It is not a tribalistic argument, it is the truth. And the truth they say is very bitter.
What do you call a man that starved over 2 million people o death, mostly women and children civilians by giving away their border to a foreign nation as a form of blockade?

It's tribalistic when you refuse to acknowledge that the man who made the actual call was Yakubu Gowon, rather than Awolowo who only served in his cabinet and at Gowon's leisure.

/

CSTR2:
Gowon was a figure-head. Awolowo was the one who offered the idea and executed it with the permission of gowon.

Well, it's certainly convenient to believe that if you want to see Awolowo as some sort of evil genius; never mind that the same nefarious mind personally went to Enugu to plead with Ojukwu not to secede, or that he tried yet again to form an all-southern alliance in 1979, even after the failure of the 1966 effort. The fact is that there is simply no evidence that Awolowo had any kind of personal bad intent towards Igbos or anyone else from the South-East.

Shifting the blame from Gowon to Awolowo sounds to me like blaming Stalin's deputies for his crimes ("If only Comrade Stalin knew!". If Gowon was such a figurehead for Awolowo, why did he find it so easy to continue in power once Awolowo left office after the war? Shouldn't the buck stop with the man at the top? It's not as if he was a half-dead Yar'adua unable to govern.

I only wish they can hear you. tell them !!!

MadamExcellency:
What does Osinbajo know about micro economic policies as the head of Economic team.

Instead of heading a committee on political and constitutional reforms to restructure the country s contained in APC manifesto, he went and accepted a portfolio he knows nothing about.

Buhari thinks that since the constitution stipulates that the Vice President heads the National Economic Team (NEC) where the 36 Governors are members is the same thing as Federal Government's Economic team responsible for micro-economic and fiscal policies hence the choice of Prof. Osinbajo. What a pathetic decision!

Chai

That is what happens when there a dullard in power who is more interested in the welfare of his daura cows..... As usual,the afonjas will raise to his defence...lolss
one chance dullapo

No economic framework on ground,nothing to convince them and they just wanna borrow...their only plan is to sell off national assets...Its a big shame..and the ever suffering and smilling and hungry afonja are applauding mediocrity and retrogression...kemi adeosun shud resign.