International Monetary Fund (IMF) has advised Nigeria to enhance transparency in the oil sector to ensure that subsidy removal savings are transferred to the government’s budget.
Gatekeepers News reports that Abebe Selassie, Director of the African Department at the IMF, made the recommendation during the presentation of the Regional Economic Outlook for Sub-Saharan Africa report.
Selassie praised the Nigerian government’s reforms aimed at addressing macroeconomic imbalances but emphasized the need for more work in expanding social protection and enhancing transparency in the oil sector.
“More can be done, particularly on the latter front: expanding social protection and also enhancing a lot more transparency in the oil sector, so that the removal of subsidies does translate into flow of revenue into government budget,” he said.
The IMF official also encouraged the government to consider reforms to engender more private sector investment and generate revenues needed to build infrastructure.
“There’s a comprehensive set of reforms that Nigeria can pursue that would help engender more growth and help diversify the economy away from reliance on oil,” Selassie added.
Regarding Nigeria’s financing needs, Selassie suggested that the government adopt a “judicious and agile” approach to borrowing. “Nigeria can look at options to borrow in a contained way,” he said, while emphasizing the importance of revenue mobilisation as a permanent solution.
