Nigeria Did Not Request For Loan – IMF

The International Monetary Fund (IMF) has disclosed that the Nigerian federal government has not requested a loan.

Abebe Selassie, the IMF Director of the African Department, made this known on Friday during a press conference in Washington, D.C., United States.

There have been speculations and reports in some parts of the media that the federal government is looking to request a loan from the IMF.

BusinessDay reported that Nigeria’s external debt will reach 25 percent of the Gross Domestic Product (GDP) in 2025, according to IMF.

Data from the IMF’s regional outlook for Sub-Saharan Africa showed that the percentage of Nigeria’s external debt to GDP increased to 22.7 percent in October 2024 from 11.9 percent in the corresponding period of 2023 and is projected to reach 25 percent next year.

According to the IMF’s latest regional outlook, released on Friday in Washington, high inflation rates, fiscal deficits, and rising debt obligations continue to undermine the economic stability of many countries, including Angola, Ethiopia, Ghana, and Nigeria.

While addressing the loan request, Selassie said, “No, there has not been a request for funding from Nigeria.

“To be very clear, this question has also arisen concerning some other countries. If and when countries turn to us, we hope they do so with a clear plan for the economic reforms they wish to pursue, with our support helping to reduce the funding costs they face.

“It is the right of any country in good standing with the IMF to borrow and access the concessional financing we provide. But, at present, there is no request for funding from Nigeria.”

The IMF also expressed concern over Nigeria’s implementation of social measures intended to cushion the adverse effects of recent economic reforms, specifically the removal of fuel subsidies and unification of the foreign exchange rate.

According to the IMF, these efforts are unfolding too slowly, leaving Nigerian citizens struggling with high living costs as the economy grapples with inflation and other fallout from the reforms.

Selassie emphasised that a more robust approach could have been adopted to shield the most vulnerable. “A better job can be done by rolling out social protection, particularly for the most vulnerable,” he stated in response to a question from BusinessDay.

SOURCE: BusinessDay