The International Monetary Fund (IMF) has called on the Nigerian government to scale up its cash transfers to help poor Nigerians manage the current cost of living crisis. cost of living crisis

Axel Schimmelpfennig, IMF’s Assistant Director, African Department and Mission Chief to Nigeria, made this call at the briefing on Nigeria’s Article IV Consultation on Thursday.

He said: “On fiscal policy, we very much recognised the pain that many Nigerians are facing at the moment. Hence, our emphasis on scaling up the cash transfer programme. It can potentially reach up to 50 million recipients, and that is potentially benefit some 65 million Nigerians in need.”

Nigerians under lots of pain

The IMF also acknowledged the pain Nigerians are going through due to rising inflation and ongoing reforms.

Schimmelpfennig said: “There is a lot of pain for Nigerians right now, and our policy advice aims to provide support to those in need while reinvigorating growth and job creation.”

He noted: “We encourage that the cash transfer system and other support systems are implemented. We emphasise that it is very important to scale those up to help Nigerians manage the ongoing cost of living crisis.”

Schimmelpfennig further said that the Fund supports the Central Bank’s commitment to bringing down inflation, which hurts the poor disproportionally.

Low revenue hampers fiscal policy

In its latest staff report for Nigeria, the IMF noted fiscal policy in Nigeria is limited due to low government revenue, which is about 9.4% of the country’s Gross Domestic Product (GDP).

The report read: “Fiscal policy needs to support vulnerable households, create space to boost social and development spending, and maintain debt sustainability. Fiscal policy is held back by one of the lowest revenue takes in the world of 9.4 percent of GDP in 2023.

“As the government finalizes and presents its reform agenda, sequencing will be key to ensure safety nets are in place or strengthened before proceeding with other measures that could adversely impact poor and vulnerable households.”

The report further stressed the need for the Federal Government to reprioritise expenditures to ensure social protection.

It read: “Expenditure reprioritization is needed to create space for social protection and other priority spending. The authorities have recently approved an enhanced social transfer mechanism developed with World Bank support, and some initial payments have been made.

“In response to governance concerns, the authorities automated and digitalized the system to build a robust mechanism that delivers swift and targeted support to vulnerable households—some 15 million households or 60 million Nigerians potentially benefit from the scheme. Once the safety net has been scaled up and inflation subsides, the government should tackle implicit fuel and electricity subsidies.”

What you should know
▪︎The World Bank recently said that cash transfers can help save Nigerians from intergenerational poverty traps as inflation and low economic growth adversely affect the poor.

▪︎However, new research by the World Bank revealed that the conditional cash transfer program of the Federal Government since 2016 has little effect on household consumption, financial inclusion or employment of beneficiaries, especially women.

▪︎The Federal Government had to suspend the cash transfer programme for further investigation and revamping following alleged misappropriations within the programme.

▪︎Betta Edu was earlier suspended as a humanitarian affairs minister due to the misappropriation of N585 million earmarked for palliative distribution.

▪︎Also, Edu’s predecessor, Sadiya Umar-Farouq, is being investigated by the EFCC. The ex-minister is being probed over an alleged laundering of N37.1 billion during her tenure as a minister.

▪︎The Federal Government recently said that it has revamped its cash transfer program to combat fraud, with immediate implementation of direct payments.

It read: “Expenditure reprioritization is needed to create space for social protection and other priority spending. The authorities have recently approved an enhanced social transfer mechanism developed with World Bank support, and some initial payments have been made.

“In response to governance concerns, the authorities automated and digitalized the system to build a robust mechanism that delivers swift and targeted support to vulnerable households—some 15 million households or 60 million Nigerians potentially benefit from the scheme. Once the safety net has been scaled up and inflation subsides, the government should tackle implicit fuel and electricity subsidies.”

SmartPolician:
IMF, I think it's time to let you know that you cannot give what you don't have. Nothing has nothing to offer this country

CodeTemplar:

Summarising the bold, they are saying, look, restructure and de-incentivise corruption while putting the money to effective use that will truly serve nigerians, then attempt removing subsidies.

Cc: nairalanda1 and grandstar.

Racoon:
After their neck constricting policies helped the disastrous government to impoverish Nigerians some more. Meanwhile the government zombies still think otherwise.

nairalanda1:


Why not fight corruption, remove subsides and industrialize?

Keeping subsides, means more debt, which means more burden for the poor. Remove subsides, and there is a chance of investment and jobs , which benefit...the poor.

CodeTemplar:
my posts on need to adjust and fight the underlying corruption ravaging our subsidies can be complied into a book. You won't see nairalanda1 and grandstar. It is when the thread dies you will see them brainwashing few gullible and "swayable" folks around.

CodeTemplar:
a country using N90b to go and stone devil is not a broke country. You can't know our balance sheet more than a first class accountant surrounded by builders of Lagos.

Add it all up and the numbers say that if you really want to know how a country is going to do in the 21st century, don’t count its oil reserves or gold mines, count its highly effective teachers, involved parents and committed students. “Today’s learning outcomes at school,” says Schleicher, “are a powerful predictor for the wealth and social outcomes that countries will reap in the long run.”

Economists have long known about “Dutch disease,” which happens when a country becomes so dependent on exporting natural resources that its currency soars in value and, as a result, its domestic manufacturing gets crushed as cheap imports flood in and exports become too expensive. What the PISA team is revealing is a related disease: societies that get addicted to their natural resources seem to develop parents and young people who lose some of the instincts, habits and incentives for doing homework and honing skills.

By, contrast, says Schleicher, “in countries with little in the way of natural resources — Finland, Singapore or Japan — education has strong outcomes and a high status, at least in part because the public at large has understood that the country must live by its knowledge and skills and that these depend on the quality of education. ... Every parent and child in these countries knows that skills will decide the life chances of the child and nothing else is going to rescue them, so they build a whole culture and education system around it.”

Or as my Indian-American friend K. R. Sridhar, the founder of the Silicon Valley fuel-cell company Bloom Energy, likes to say, “When you don’t have resources, you become resourceful

He was implacable. “Oh yes it is and I will say it again, you are lazy. Poor and uneducated Africans are the most hardworking people on earth. I saw them in the Lusaka markets and on the street selling merchandise. I saw them in villages toiling away. I saw women on Kafue Road crushing stones for sell and I wept. I said to myself where are the Zambian intellectuals? Are the Zambian engineers so imperceptive they cannot invent a simple stone crusher, or a simple water filter to purify well water for those poor villagers? Are you telling me that after thirty-seven years of independence your university school of engineering has not produced a scientist or an engineer who can make simple small machines for mass use? What is the school there for?”

I held my breath.

“Do you know where I found your intellectuals? They were in bars quaffing. They were at the Lusaka Golf Club, Lusaka Central Club, Lusaka Playhouse, and Lusaka Flying Club. I saw with my own eyes a bunch of alcoholic graduates. Zambian intellectuals work from eight to five and spend the evening drinking. We don’t. We reserve the evening for brainstorming.”

He looked me in the eye.

“And you flying to Boston and all of you Zambians in the Diaspora are just as lazy and apathetic to your country. You don’t care about your country and yet your very own parents, brothers and sisters are in Mtendere, Chawama, and in villages, all of them living in squalor. Many have died or are dying of neglect by you. They are dying of AIDS because you cannot come up with your own cure. You are here calling yourselves graduates, researchers and scientists and are fast at articulating your credentials once asked—oh, I have a PhD in this and that—PhD my foot!”

I was deflated.

“Wake up you all!” he exclaimed, attracting the attention of nearby passengers. “You should be busy lifting ideas, formulae, recipes, and diagrams from American manufacturing factories and sending them to your own factories. All those research findings and dissertation papers you compile should be your country’s treasure. Why do you think the Asians are a force to reckon with? They stole our ideas and turned them into their own. Look at Japan, China, India, just look at them.”

He paused. “The Bwana has spoken,” he said and grinned. “As long as you are dependent on my plane, I shall feel superior and you my friend shall remain inferior, how about that? The Chinese, Japanese, Indians, even Latinos are a notch better. You Africans are at the bottom of the totem pole.”

He tempered his voice. “Get over this white skin syndrome and begin to feel confident. Become innovative and make your own stuff for god’s sake.”

At 8 a.m. the plane touched down at Boston’s Logan International Airport. Walter reached for my hand.

“I know I was too strong, but I don’t give it a damn. I have been to Zambia and have seen too much poverty.” He pulled out a piece of paper and scribbled something. “Here, read this. It was written by a friend.”

He had written only the title: “Lords of Poverty

CodeTemplar:
a country using N90b to go and stone devil is not a broke country. You can't know our balance sheet more than a first class accountant surrounded by builders of Lagos.

nedu666:
Imf don run tinubu Street

Imf: Bat remove fuel subsidy and float naira
Bat: l have done that
Imf: Good. But ya people are suffering
Bat: ah, are you not the one that advised me to remove fuel subsidy
Imf: so if I say put hand in fire, you will put hand in fire
Bat: ah, egbami, my people come and see this imf people

MEEVEET:


Did IMF tell him to budget 15 trillion for a road that's not needed but 75 billion for SMEs? 20 billion for students loan?


Did imf tell him to rush an announce fuel subsidies?

Did imf tell him to float without stabilizing the currency

The only issue is IMF thinks African leaders like Ebola add smart enough to know basic things

nairalanda1:


When debt was eating 90% of our revenue by 2022, something had to give.

Keeping subsidy would have caused the debt resulting to eat 100% of our revenue. Maybe more.

There is a reason why all 3 candidates said they would remove subsidy. There is also a reason why tinubu and buhari should have kept quiet in 2012, or supported the then government's effort to remove subsidy back then.(Opposition is not about knee jerk things).

MEEVEET:

Debt is eating 90% of your revenue and the sensible thing you can think of is to borrow 7.5 trillion to build a road that can't generate anything revenue?

Removing subsidy and floating the naira was never the issue the issue was how they were done

You just want to convince yourself all the 3 candidates are same when it's obvious they are not

Kelklein:
At least Buhari was giving npower people money 30k almost throughout his tenure.. even though some of his social safety net programmes were cover for stealing public money

But by the way, while IMF canvasses for the removal of what they called Implicit fuel subsidy, in their history of giving advice, I have never seen where they advised government officials to stop stealing public funds.. even when it was clear that the casj transfer they advocate is not getting to the target poor.

Or they want to pretend that they don't know that a minster is this country was feeding school children in school while they were on lockdown in their parents' houses. 🤔🤔

CodeTemplar:

Summarising the bold, they are saying, look, restructure and de-incentivise corruption while putting the money to effective use that will truly serve nigerians, then attempt removing subsidies.

Cc: nairalanda1 and grandstar.