IMF recommends total removal of fuel subsidy in Nigeria

IMF Greece Financial Crisis10 May 2013, Abuja – The International Monetary Fund, IMF, says full removal of oil subsidy in Nigeria would help fiscal adjustment for economic growth.

Country Representative of IMF in Nigeria, Mr. Scott Rogers, said this when he briefed newsmen on Nigeria Staff Report for 2012 Article IV Consultation.

He said: “Macroeconomic performance and policies in 2012 were broadly positive. Fiscal targets for 2013 and medium term are consistent with macroeconomic stability, but additional measures are needed.

“Planned savings in recurrent spending will require public sector reforms and elimination of subsidy would help fiscal adjustment.”

He said the report recommended the need to mobilise non-oil revenues and strengthen oil price rule and oil savings mechanism.

He said there was a need to strengthen implementation capacity of public investment, adding that maintaining tight monetary policy till signs of durable reduction of inflationary pressures was imperative.

Rogers said that government must embark on urgent structural reforms to enhance productivity and global competitiveness.

He said: “Power reform is a quick win for growth and competitiveness. Petroleum Industry Bill will transform oil and gas sector to increase investment trade protection for infant industries.

“Export diversification is key to long-term growth and improved macroeconomic statistics, especially in national income accounts.”

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