The International Monetary Fund (IMF) has once again called for the Federal Government to end the payment of fuel subsidies, adding that such a
In a press release by the IMF, the international body clearly stated that it was vital for the Federal Government to secure oil revenues through, “reforms of state owned enterprises and measures to improve the governance of the oil sector.”
The report noted the positive recovery journey of the Nigerian economy, however, it advised the government to intensify its reform efforts, saying that: “Under current policies, the outlook remains muted.”
The IMF report stated “Bold reform efforts, following the election cycle, could boost confidence and investments, especially given relatively conservative baseline projections. On the downside, additional delays in reform implementation, a persistent fall in oil prices, reduced oil production, increased security tensions, or tighter global financial market conditions could undermine growth, provoke a market sell-off, and put additional pressure on reserves and/or the exchange rate.”
According to the statement, the IMF also advised the government to phase out the Asset Management Corporation of Nigeria (AMCON).
As the statement puts it: “Directors welcomed the decline in non-performing loans and the improved prudential banking ratios, but noted that restructured loans and undercapitalized banks continue to weigh on financial sector performance.
“They suggested strengthening capital buffers and risk-based supervision, conducting an asset quality review, avoiding regulatory forbearance, and revamping the banking resolution framework. Directors also recommended establishing a credible time bound recapitalization plan for weak banks and a timeline for phasing out the state backed asset management company, AMCON.”