The International Monetary Fund, IMF, has expressed delight with the “progress” made by President Muhammadu Buhari in fighting corruption and insurgency, but regretted that the foreign exchange, forex, policy of his administration was significantly distorting and slowing down economic activity.
It noted that while the forex restrictions have protected certain sectors of the economy, many other sectors are cutting production and sacking workers which have ultimately resulted in reduced investment and consumption.
The global institution also observed that the President’s delay in forming his cabinet until November 2015 limited the scope for a timely and comprehensive policy response to the shock experienced in oil price.





This was contained in the staff report for the 2016 article IV consultation released by the IMF on Friday where it noted that, “the strategy of supporting a de facto exchange rate peg through exchange restrictions is significantly distorting the economy and weighing on economic activity.”
The IMF, however, advised that the Central Bank of Nigeria, CBN, adopt a rather flexible foreign exchange regime.
It noted that, “policy uncertainty amplified the impact of global developments,” the institution said: “President Buhari was inaugurated in May 2015, having led the All Progressives Congress (APC) — a merger of four opposition parties — to victory in the March 28 elections, the first democratic transition of government in Nigeria’s history.
“The administration has listed fighting corruption, enhancing transparency, improving security, and creating jobs as key elements of its policy agenda.



“While progress has been made against Boko Haram, in addressing corruption, and strengthening governance, the delay in appointing a cabinet until November 2015 limited the scope for a timely and comprehensive policy response to the oil price shock.”
“The restrictions have served to protect certain sectors of the economy, but many other sectors are cutting production and shedding labor, resulting in cuts to investment and consumption.
“Foreign exchange shortages and the associated increase in the spread between the interbank rate and the rates on the BDC and parallel markets have also contributed to higher prices, undermining the desired anti-inflationary impact of the restrictions.”
“In staff’s view, a more flexible regime would facilitate attempts to diversify the export base and permit the economy to adjust more smoothly to changes in fundamentals, lowering the potential for episodes of exchange rate misalignment and reducing reliance on reserves to buffer external shocks.”



dailypost.ng/2016/04/08/your-forex-policy-is-distorting-the-economy-imf-tells-buhari/




lalasticlala.

Buhari, this is not a farm land where you rear your cows , this a country and great nation. Buhari should stop reason like herdsman , think like a president, act like a number one citizen of a nation and act like democratic leader. Buhari is not getting it right at all.

What has IMF done to help Nigerians ? Policy that will futher impoverish Nigerians. Check Morocco and Lybya currency to Nigeria Naira they don't follow IMF. Bleep IMF

I don't know Wat to comment, maybe the guy below have something better to say.

IMF should mind their business. We are strongly behind buharis policies. IMF is just looking for a way to distort our economic plans to favour them. Dollar is 190 in all the banks in Nigeria except the black market. anything called black market is not legal and always results to bad growth in the economy, that is why it is named black market in the first place. IMF should Bleep off. Naija must be better.

Temidayo9:
What has IMF done to help Nigerians ? Policy that will futher impoverish Nigerians. Check Morocco and Lybya currency to Nigeria Naira they don't follow IMF. Bleep IMF

they are not forcing Nigeria to implement any policy, they are only stating their opinion, and I think they may be right afterall. Cause I can see it crystally that Buhari is leading this country into a state of quagmire

strong766:
IMF should mind their business. We are strongly behind buharis policies. IMF is just looking for a way to distort our economic plans to favour them. Dollar is 190 in all the banks in Nigeria except the black market. anything called black market is not legal and always results to bad growth in the economy, that is why it is named black market in the first place. IMF should Bleep off. Naija must be better.

Are they the ones causing fuels scarcity, increase on dollar at parralel market, shutting down of factories, increased unemployment and inflation ?

mekaboy:


Are they the ones causing fuels scarcity, increase on dollar at parralel market, shutting down of factories, increased unemployment and inflation ?

this is just a short term problem that we all shld face. Our economy will soon change for good.

mekaboy:


Are they the ones causing fuels scarcity, increase on dollar at parralel market, shutting down of factories, increased unemployment and inflation ?

this is just a short term problem that we all shld face. Our economy will soon change for good. Be patient