IMF, Here We Come! | Independent Newspapers Limited
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IMF, Here We Come!

Posted: May 29, 2016 at 5:12 am   /   by   /   comments (0)


Andy Nssien


President Buhari may have succeeded in foisting the 67 percent fuel price hike on Nigerians without much resistance from the opposition camp, but  the implications of such unprecedented price jump are yet to dawn on businesses and the citizenry majority of whom would turn the flotsam and jetsam of awkward economic policies.

Albeit, the Buhari’s administration sees the fuel price rise  from N86.50 to N145 per litre as Hobson’s choice, the down trodden and the impoverished masses whose interest government is supposed to protect, regard it as another testimony to the glaring insensitivity to and disinterest in their cause.


It is this same tactless and appalling posture of government that plays out at the Ojota pedestrian crossing bridge in the Maryland area of Lagos. How on earth can a government subject its citizens to further hardship after paying exorbitant fares to get to the bus-stop  only to face the agony of joining the near endless queues which snake into adjoining Ogudu Road, two poles away, in order to cross the bridge!. If the authorities have become so insensate to invaluable man-hours lost during the exercise,  what of the negative image the ugly scenery creates to visitors accessing the Centre Of Excellence through Ojota, probably for the first time? But why put the cart before the horse if a second pedestrian bridge is being contemplated to deal with the situation?  The answer, my friend, is blowing in the wind, according to an influential American singer-songwriter, Bob Dylan who turned 75 last week. That’s by the way.


Although, the Federal Government has tacitly avoided using the expression, fuel subsidy removal, so as not to betray reneging on PMB’s campaign and post election promises, the increase of fuel price to N145 per litre, nevertheless, appears to be a major success for the administration, not just in meeting its domestic agenda, but clearing the hurdle for crucial international relationships.

Not a few Nigerians may be willing to endure the bitter pills as far as they are not externally motivated. To others, it does not matter where the pills come from if  it would provide the needed elixir to the pains. But who is afraid of the IMF, an acronym that sounds more scaring than its translated version, International Monetary Fund?

Driven by economic imperatives to overcome the political inertia, the coast is now clear for Government to play along with the IMF.   What of the dreaded devaluation of the Naira, a sine-quo-non of the IMF loan? Never mind, just like the subsidy issue, PMB could cave in at any time.

The exigencies of  the dire economic situation in the country make this brain wave appealing, just as the Federal Government’s worry about how to finance the N2.2 trillion deficit in this year’s budget would undermine any resistance to the contrary. The thought of the emergence of another militant group, the Niger Delta Avengers which the authorities have no clue on how to clip its wings, is a nightmare that can unsettle any well-intentioned administration. Also alluring, is the thinking that the PMB-led government could fight indiscipline and corruption to a standstill, thereby providing conducive grounds for smooth enforcement of IMF guidelines which were lacking in previous commitments.


But Nigeria is not alone in this suppliant boat, even as the IMF says it stands ready to help oil exporters, such as Angola and Nigeria, cope with plunging crude prices and growing fiscal pressures.

Angola, whose leaders squandered billions of dollars during the years of sky-high oil prices, is one of the latest on the queue to take the IMF facility.

Last year, the Executive Board of the IMF  approved a three-year arrangement under the Extended Credit Facility (ECF) for Ghana in an amount equivalent to SDR 664.20 million or about US$918 million in support of the authorities’ medium-term economic reform programme.


Zambia, which economy has been devastated by low copper prices, is negotiating a similar deal, while Tunisia and the IMF have agreed in principle on a new $2.8-billion loan, subject to approval by the Fund’s executive board.


However, there is a fly in the ointment which informs why Nigeria should be wary of being nudged to jump  into the bandwagon.

Among the hordes of reasons why many countries see IMF facilities as plague, the loss of control by the recipient economy ranks very high. This explains why two years ago, Hungary which unwittingly jumped into the IMF train, had to repay ahead of schedule, all of its outstanding debt, worth €2.15 billion ($2.4b), owed to the IMF from a 2008 emergency loan programme. The sole purpose of  the early repayment under Orbanomics which saved €11.7 million ($13.08m) in interest expenses,   was to end what was portrayed as undue foreign influence over its economic policies.


But President Buhari is not oblivious of the implications of these IMF scourges, which informed his “No”response to visiting IMF Chief, Christine Lagarde in January this year who sought to know if Nigeria would  take an IMF loan.

While  hoping that PMB would continue to hold the fort against these neoliberal policies in spite of prevailing challenges,, what the administration should dissipate its energy on for now,  is how to expedite action on building modular refineries co-terminal with existing refineries which would ensure unsurpassed availability of the product not only for internal consumption, but for exports to our neighbouring countries.