Exclusive: IMF says Nigeria needs urgent reform-document

ABUJA-The International Monetary Fund (IMF) is expected to warn Nigeria its economy needs urgent reform, according to a report seen by Reuters that could delay talks over $1.4 billion in international loans.

The Washington-based fund will urge Nigeria, a major oil producer, to introduce immediate changes to its exchange rate policy and say its recent reform plan is not enough to drag Africa’s biggest economy out of recession, according to the 68-page report.

“Much more needs to be done,” the IMF said in the document, written after a final meeting between its representatives and top officials in the capital Abuja before the fund issues its verdict on Nigeria’s economy, expected on March 29.

“Further actions are urgently needed,” it said.

The report – from the fund’s acting secretary and addressed to members of its executive board – is set to form part of the IMF’s verdict, although Nigeria can request alterations.

Three people familiar with the negotiations said it would send an important signal to institutional lenders.

The World Bank has been in talks with Nigeria for a loan of at least $1 billion for more than a year and the African Development Bank (AfDB) has $400 million on offer, but discussions have stalled over economic reforms.

Nigeria is seeking the funding for infrastructure investment and to help plug an expected record deficit in this year’s budget as it boosts spending to try to end a recession.

“The tone of the IMF will be critical in terms of signaling,” said one of the people familiar with the negotiations, who spoke on condition of anonymity because they were not authorized to speak to media.

Two of the people with knowledge of the loan talks said the lenders were unlikely to withhold funding entirely

Source: Angola Press News Agency