World Bank report on Nigeria cites threats, insufficient forex, insecurity

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muhammadu-buhari-reflective3
President Muhammadu Buhari

Special to USAfrica magazine (Houston) and USAfricaonline.com, first Africa-owned, US-based newspaper published on the Internet. 

The World Bank’s Nigeria Development latest report has warned that despite some efforts by the Nigerian government to deal with its various economic challenges,  “the reform momentum weakened in 2021, and in the absence of continued progress, key macroeconomic challenges have re-emerged as major threats to growth.” 

The World Bank noted that “Issues around the predictability and credibility of exchange-rate management, the insufficient supply of foreign exchange, the unsustainable subsidy for premium motor spirit, burdensome trade restrictions, and the sizeable fiscal deficit financing by the Central Bank of Nigeria continue to undermine the business environment, compounding underlying constraints related to governance and the delivery of public services.”

The report added that “In 2020, the Nigerian government began to address longstanding macroeconomic challenges by harmonizing the two main exchange rates, adjusting electricity tariffs to more cost-reflective levels, cutting nonessential spending, redirecting budgetary resources towards the COVID-19 response at both the federal and state levels, strengthening debt management, and increasing the transparency of oil and gas operations.” 

Also, The World Bank Country Director for Nigeria, Shubham Chaudhuri, cited some factors as impacting the country: “Even though Nigeria’s economy exited a pandemic-induced recession, several challenges persist including double-digit inflation, declining incomes, and rising insecurity. While the government took bold policy measures to mitigate the impacts of the COVID-19 crisis, the reform momentum has slowed which hinders Nigeria’s ability to reach its growth potential.”

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