Nigeria’s engagement with the global debt market continues to thrive, according to the International Monetary Fund (IMF), despite the hurdles of rising borrowing costs. During the recent IMF/World Bank annual meetings in Washington, Tobias Adrian, the IMF’s Financial Counsellor, noted that Nigeria and other frontier markets have demonstrated robust activity in debt issuance throughout 2024. While financing remains costlier than pre-2021 levels, the overall levels of issuance have been encouraging, reflecting a resilient approach to capital raising.
The IMF expressed support for Nigeria’s recent monetary policies, particularly the Central Bank’s (CBN) interest rate hikes and foreign exchange reforms aimed at stabilizing the economy. Adrian highlighted that these measures are essential for tackling inflation, which is nearing 30%. He emphasized the significance of these reforms in light of ongoing inflationary pressures exacerbated by natural disasters like floods, which have further impacted living conditions across the nation. The IMF has also adjusted its economic forecast for Nigeria, predicting a growth rate of 2.9% for 2024, slightly down from earlier projections due to challenges in agriculture and oil production.
In parallel, Nigeria’s Minister of Finance, Wale Edun, engaged with the IMF’s leadership to discuss the nation’s economic prospects and ongoing reforms under President Bola Tinubu’s administration. Edun underscored the necessity of increased international support and concessional loans from the IMF and World Bank to bolster Nigeria’s reform agenda. He pointed out that such funding is vital for achieving macroeconomic sustainability and providing social safety nets to shield vulnerable populations from the immediate effects of economic adjustments. The discussions also included the role of the Nigerian diaspora in enhancing remittance inflows, crucial for maintaining foreign exchange reserves amid fiscal challenges.
