Ben Akabueze, the Director-General of the Budget Office of the Federation, said if Nigeria is unable to resolve its budgetary problems, it may turn to the International Monetary Fund (IMF) for assistance.
In an interview on Arise TV’s Global Business Report monitored by TeechEconomy on Nigeria’s debt and spending habits, Akabueze said even though Nigeria does not need a bailout at the moment like some other struggling nations, it might do so in the future.
The DG said, “Essentially, there are two ways countries end up with the IMF. One is voluntary when they ask the IMF for help, or when things get to the grind where they simply have no other option. I don’t see Nigeria going to the IMF voluntarily.
The honest truth is that if we don’t address our fiscal challenges in a sensible and sustainable manner, we may end up unwillingly with the IMF.”
Nwabueze said it was time for the nation to start considering the increase in taxes as a means of raising revenue while considering a cut-down on its expenditure.
He said, “There is a maxim that if you find yourself in a pit, you should stop digging and start climbing out. If we continue to fund regressive deficits, it is equivalent to continuing to dig.
If we continue to pass on reasonable opportunities to increase revenues by introducing taxes, it is tantamount to continue digging.
“Even though I said we should not cut expenditure in total, we need to get more efficient in our spending. If we don’t do that again, it is tantamount to continuing to dig.”
The former Commissioner for Economic Planning and Budget in Lagos State reaffirmed that there were serious financial issues that needed to be resolved for the country.
While Nwabueze advocated for the long-term removal of petroleum subsidies, he suggested that money saved from the removal be used to open up investment opportunities in the oil industry.
He emphasized that more than 60 years after the nation’s oil exploration and production began, it was absurd to continue exporting crude without first refining it.