The foreign exchange restrictions placed on 43 items by the Central Bank of Nigeria (CBN) on Tuesday drew criticism from the International Monetary Fund (IMF).

The policy is holding back Foreign Direct Investments (FDIs) into the local economy, IMF’s Divisional Chief, Research Department, Oya Celasun, told a news conference on the World Economic Outlook at the World Bank/IMF Annual Meetings in Washington D.C.

Besides, the IMF chief said Nigeria requires a tight monetary policy and the unification of its exchange rates to achieve the desired growth.

His position contradicted that of CBN Governor Godwin Emefiele who had always insisted that the apex bank acted in the best interest of the local economy.

He said the decision to restrict forex access and shut the official foreign exchange window for the importation of the banned 43 items would protect Nigeria’s foreign reserves, as well as the nation’s economy.

According to him, the policy was introduced to stimulate the domestic economy and enhance domestic production and protect local industries from undue foreign competition and take-over.

But Celasun said the policy was working to the contrary, pointing out that Nigeria’s growth has been weak, even as he gave hope that growth would pick up next year with support from the agricultural sector, which will enable the country to spend more on priorities, such as social safety and infrastructure.

He said: “There is need for the strengthening of the banking system and unified exchange rate system. Foreign exchange restrictions have also been distorting the public and private sector decisions and holding back investment. Therefore, strengthening the banking sector resilience and continued stronger structural reforms, especially in infrastructure, power sector and broader governance, are critical.”

Eyes Of Lagos gathered that, IMF Chief Economist and Director of the Research Department Mrs. Gita Gopinath noted that the local economy still depended on oil prices and its prospects.

She added that there has been some weaknesses in the oil sector, stressing that one thing to keep in mind about Nigeria was that per capital growth has remain weak, hence, the need for structural reforms.

Celasun said Nigeria saw slight upward revision for growth this year and that came mostly from strong agricultural production.

However, the growth was not high enough to lift the per capital growth into positive territory.

Mrs. Gopinath said: “For some time, we have been emphasing on a comprehensive package to lift growth. One element of that will have to be stronger non-oil revenue mobilisation, as Nigeria has one of the lowest rate of revenue in the world, which was hit hard by the drop in oil prices. Stronger non-oil revenue mobilisation is essential for the country to be able to spend more on priorities such as social safety and infrastructure.”

She said the global economy is in a synchronised slowdown, stating that the Fund was downgrading growth for 2019 to three per cent, its slowest pace since the global financial crisis.

Her words: “Growth continues to be weakened by rising trade barriers and increasing geopolitical tensions. We estimate that the US-China trade tensions will cumulatively reduce the level of global Gross Domestic Product (GDP) by 0.8 per cent by 2020.

“Growth is also being weighed down by country-specific factors in several emerging market economies, and structural forces—such as low productivity growth and aging demographics in advanced economies, adding that in the October World Economic Outlook.

“We are projecting a modest improvement in global growth to 3.4 per cent in 2020, reflecting another downward revision of 0.2 per cent from our April projections. However, unlike the synchronized slowdown, this recovery is not broad-based and remains precarious.”

She attributed the weakness in growth to a sharp deterioration in manufacturing activity and global trade, with higher tariffs and prolonged trade policy uncertainty damaging investments and demand for capital goods.

“In addition, the automobile industry is contracting owing also to a variety of factors, such as disruptions from new emission standards in the Euro area and China that have had durable effects. Overall, trade volume growth in the first half of 2019 has fallen to one percent, the weakest level since 2012,” she said.

She went on: “Also, in contrast to extremely weak manufacturing and trade, the services sector continues to hold up almost across the globe. This has kept labour markets buoyant and wage growth and consumption spending healthy in advanced economies, saying there are some initial signs of softening in the services sector in the United States and euro area.

“Monetary policy has played a significant role in supporting growth. In the absence of inflationary pressures and facing weakening activity, major central banks have appropriately eased to reduce downside risks to growth and to prevent de-anchoring of inflation expectations.

https://thenationonlineng.net/imf-faults-forex-restrictions-on-43-items-as-hurting-investments/amp/

IMF should allow us to try restriction since importation of all have failed us as a nation.

IMF, no more dollars to input tooth pick and foreign apples.

IMF should STFU.

Their pressures on Ecuadorian government has turned Ecuador to a mini war country due to Austerity measures introduced by their government.

Anywhere IMF dey, na there wahala dey dey

He said the decision to restrict forex access and shut the official foreign exchange window for the importation of the banned 43 items would protect Nigeria’s foreign reserves, as well as the nation’s economy.
According to him, the policy was introduced to stimulate the domestic economy and enhance domestic production and protect local industries from undue foreign competition and take-over.

Anything to move our nation forward is what we are after.
To a New and better Nigeria we go.

Even though I dont think the IMF always mean well for this place called Nigeria... but the fact that this current administration keeps missing priorities sincerely and worse off putting the cart before the horse in almost all their policies - THESE ARE JUST THE ISSUES - hence the suffering and pain in the land

SMH.
This same people convinced our previous governments to start charging money for education and health care.

IMF that have wrecked so many developing countries... it is high time they keep their opinions...


They should go and give Venezuela advice they need it more

exchange restrictions

Buhari and IMF divorce is so intresting to watch

I pray they dont kill buhari for us as they eliminated Ghadafi of Libya

..

If you want your economy to improve, just go ahead and do whatever IMF say you shouldn't do.

It's an open secret.

They want us to deplete our foreign reserve on cheap imports so that we'll come beg them and world Bank for rescue then they'd start giving us conditions like they did to IBB with SAP that ruined our economy then.
Una try, come back tomorrow

helinues:
IMF should STFU.

Their pressures on Ecuadorian government has turned Ecuador to a mini war country due to Austerity measured introduced by their government.

Anywhere IMF dey, na there wahala dey dey

In fairness to the IMF, their advice to Ecuador is sensible.

Oil prices are low, Ecuador isn't earning enough cash. And they are finding it hard to sustain their fuel subsides.

So, IMF advising them to cut subsides, and also to embrace austeirty...is good advice.

The alternative....Ecuador takes more loans (even worse idea!) to pay for all those wlefare programmes.

They should mind their business

Area4Area:
They want us to deplete our foreign reserve on cheap imports so that we'll come beg them and world Bank for rescue then they'd start giving us conditions like they did to IBB with SAP that ruined our economy then.
Una try, come back tomorrow

Man we sabi, I dey feel you.
These agent of Satan actually set cornived with some senseless African heads of state to cripple Africa economically.

PoliticalWitch:


In fairness to the IMF, their advice to Ecuador is sensible.

Oil prices are low, Ecuador isn't earning enough cash. And they are finding it hard to sustain their fuel subsides.

So, IMF advising them to cut subsides, and also to embrace austeirty...is good advice.

The alternative....Ecuador takes more loans (even worse idea!) to pay for all those wlefare programmes.

Where were IMF when the Ecuadorian governments have been diverting the loans taking.. No be I didn't care dem do?

helinues:


Where were IMF when the Ecuadorian governments have been diverting the loan taking.. No be I didn't care dem do?

We may complain all day long about the IMF and bad past governments, but that does not deal with the problem....countries have to make money, and if they are not willing to become innovative to do so, and keep on exporting raw materials in return for forex which they export...they would forever be in economic problems.

Let's hear from Sai Baba developmental economists.

PoliticalWitch:


We may complain all day long about the IMF and bad past governments, but that does not deal with the problem....countries have to make money, and if they are not willing to become innovative to do so, and keep on exporting raw materials in return for forex which they export...they would forever be in economic problems.

IMF should have helped them fight corruption first so that they could use the money recovered for the innovative purpose instead of puting ordinary citizens in a dicey situations, people who do not have an idea about how much was borrowed not to talk of how much enter their pockets

Who IMF epp.

IMF na tool in the hands of the West to continue to keep developing countries POOR!

[s]

solmusdesigns:




Buhari and IMF divorce is so intresting to watch

I pray they dont kill buhari for us as they eliminated Ghadafi of Libya

..

[/s]

PoliticalWitch:


In fairness to the IMF, their advice to Ecuador is sensible.

Oil prices are low, Ecuador isn't earning enough cash. And they are finding it hard to sustain their fuel subsides.

So, IMF advising them to cut subsides, and also to embrace austeirty...is good advice.

The alternative....Ecuador takes more loans (even worse idea!) to pay for all those wlefare programmes.

don't mind all these illitrate, they just jump into news without analysing

helinues:


Where were IMF when the Ecuadorian governments have been diverting the loan taking.. No be I didn't care dem do?

If your father takes loan for the purpose of paying your school fees and after taking the loan he decides to carry women with it will you blame the person that borrowed him the money? When will ppl start taking responsibility? The CBN restrictions have been on for over 4 years have you seen any improvement on the economy? Why have multiple exchange rate? The economy is slow and yet you have Nigerian leaders not ready to cut down on their budget...yet you blame IMF.
NASS budget is still 125 billion even with the economic downturn

loswhite:
If your father takes loan for the purpose of paying your school fees and after taking the loan he decides to carry women with it will you blame the person that borrowed him the money? When will ppl start taking responsibility? The CBN restrictions have been on for over 4 years have you seen any improvement on the economy? Why have multiple exchange rate? The economy is slow and yet you have Nigerian leaders not ready to cut down on their budget...yet you blame IMF.
NASS budget is still 125 billion even with the economic downturn

You should have used your father instead cos my father is not reckless..

The meaning of IMF is International Monetary Funds.. This is not a personal business.. They have rights to questions and monitors what the governments are taking the loan for... Perhaps, they only care about the interest not the fairness of the country.

Nonsense and Ingredients.. The funniest part of the IMF frauds, The legitimate countries that have good intentions wont get IMF loans

Their advices always seem sensible at the beginning. Check the history, no country has developed without subsidy for basic amenities. The problem is not the subsidy, but the management of subsidy. Let us address the real issues pls.

PoliticalWitch:


In fairness to the IMF, their advice to Ecuador is sensible.

Oil prices are low, Ecuador isn't earning enough cash. And they are finding it hard to sustain their fuel subsides.

So, IMF advising them to cut subsides, and also to embrace austeirty...is good advice.

The alternative....Ecuador takes more loans (even worse idea!) to pay for all those wlefare programmes.

MoIbrahim:
Their advices always seem sensible at the beginning. Check the history, no country has developed without subsidy for basic amenities. The problem is not the subsidy, but the management of subsidy. Let us address the real issues pls.

Well, subsides are OK....so long as you have the cash to maintain them. And here is the thing....Nigeria isn't earning enough cash from oil (our breakeven price...the price of oil at which we can earn enough once production costs are paid off...is $140. Oil today is $58-60.)

Subsides also stifle investment. Like now, here in Nigeria, no one is going to come and invest in our power and petroleum sector because subsides won't let them make a profit (By contrast, Obasanjo's refusal to introduce subsides in the telecoms sector is one reason why GSM is flurishing today, and why we have a GSM and internet network that was built without a drop of government money).

Then subsides take away money that could be used for things like health and educaiton...which benefit the poor much more.

Finally, subsides are prone to corruption. Subsides don't let people make a profit...which is why petroleum makrteters SMUGGLE FUEL to Benin and other countries....where they can earn a whole lot of profit.

In my opinion, let's remove subsides, spend the money on educaiton, health and transport....and watch as we have more investment, more refineries, and competiton induced reduction in fuel prices. Just like IN the GSM sector.

Ok

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