Mr. Wale Edun, the Nigeria minister of Finance and coordinating minister of Economy, spoke on Thursday at the International Monetary Fund (IMF) and World Bank, at Washington D.c.
He was also represented at the G24, by Ben Akabueze, director general of the Budget Office of the Federation. The following are important highlight of his discussion in the aforementioned forums.
In a meeting with investors at the ongoing Spring Meetings of the IMF and World Bank in Washington DC, Mr. Wale Edun revealed that, President Bola Tinubu-led Federal Government has not resorted to borrowing from the Central Bank of Nigeria (CBN).
Edun, also affirmed the government’s commitment to employing ‘Ways and Means’ to tackle issue concerning liquidity oversupply in the system.
He emphasized the collaborative efforts between fiscal and monetary authorities to combat inflation and stabilize prices, while highlighting the objective of lowering interest rates to facilitate affordable borrowing for investors and drive economic recovery.
In his words:
“We will pin down Ways and Means to alleviate the pressure of excess money in the system,” underscoring the coordinated approach to address inflation and exchange rate stability.
The Minister stressed the importance of reducing reliance on borrowing and enhancing domestic resource mobilization. He outlined plans for tax reforms aimed at streamlining tax structures, leveraging technology, and implementing policies to double tax revenue within the next three years.
He however expressed concern over Nigeria’s low tax-to-GDP ratio, which stands below the African regional average.
The Finance Minister hinted at possible tax evasion, stating, “At 10 percent to GDP, what should I say, it would appear as if some people are not paying their taxes.”
The government’s focus on domestic resource mobilisation aligns with its long-term economic strategy to minimize repayment and refinancing pressures associated with external borrowing.
On other flip of the coin, the Minister of Finance, through Mr. Ben Akabueze also called for increased investments and trading partnerships from member countries of the Group of Twenty-Four.(G24).
The Group of 24 is an assembly of developing nations, with the collective aim is collaborate in aligning their stances on issues related to international monetary policy and development financing.
Mohammed Danjuma, the director of Information and Public Relations Ministry of Finance, in statement said, the Minister highlighted the Nigerian Government’s implementation of various intervention programmes and robust policies under the current administration.
These measures have reportedly begun to show positive effects, notably reducing the disparity between the parallel market and the official Nigeria Foreign Exchange Market rates.
Edun emphasized Nigeria’s advantageous position to attract foreign investments in diverse sectors, including manufacturing, agriculture, and oil and gas.
In response to a query from a Russian journalist, he pointed out that the last significant investment from Russia was the Ajaokuta Steel Company.
He also noted Nigeria’s vast arable land, second only to Brazil, suggesting that the country has the potential to become a major food exporter rather than an importer.
Addressing the operations of the Dangote Refinery, the minister defended the strategy to prioritise meeting domestic petroleum product demands before considering exports. He questioned the rationale behind exporting refined products while the nation continued to import them from Europe.
Furthermore, Edun assured all that the capital component of the 2023 supplementary budget would continue to be executed until June, reflecting the government’s commitment to impactful development across various sectors.
He also confirmed that the 2024 budget is being implemented as planned, promising improved welfare for the citizens.
The statement underscores Nigeria’s proactive steps towards economic re-positioning and its openness to international collaboration for mutual growth and stability.
The statement partly read,
“The Federal Government has said that it needs investment and increased trading relationships from member countries of the G-24 as these will play a critical role in the country’s quest for growth as well as ensure a stable and growing economy by bringing tranquility to the tempestuous foreign exchange market.
“Represented by the Director General of the Budget Office of the Federation, Mr. Ben Akabueze, the Minister informed the G-24, a group of countries working together to coordinate the positions of developing countries on international monetary and financial issues and indeed the global gathering that Nigerian Government, on its part, has administered a cocktail of intervention programme and potent policies which are already yielding desired outcomes.
“He explained that the efforts of the President Bola Ahmed Tinubu-led Administration towards re-positioning the economy were already yielding desired outcomes, which has significantly narrowed the gap between the exchanges at the parallel market and the Nigeria Foreign Exchange Market.”
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