Federal Government, Tuesday, ruled out the option of obtaining any loan facility from the International Monetary Fund (IMF) stating that the country was not having a balance of payment problem.
It also cited the painful and stringent conditions associated with borrowing from the organisation. Speaking in an interview monitored on CNBC Africa in Abuja, Minister of Finance, Mrs. Kemi Adeosun, said Nigeria was only faced with fiscal problems and the Federal Government would want Nigerians to take responsibility for their future.
She said “the issue of the IMF borrowing is a huge national debate. For us, the IMF is a lender of last resort, when you have balance of payment problems. Nigeria does not have balance of payment problem per se, it has a fiscal problem, which is that its major revenue sources lost so much value. First we lost price, then we lost quantity.”
She explained that Nigeria’s challenges are different, adding that what the IMF does for any country seeking to borrow money from it is that they give them a programme of reforms.
Adeosun noted that the country is already doing as much reforms as any IMF programme would impose on Nigeria.
“So, my question is what would that bring that we are not already doing? What measures would be introduced that we are not already doing?” she queried.
She further stated that Nigerians must take responsibility for their future, while the country must initiate home-grown, home-designed programmes of reforms that Nigerians could take ownership of, due to the fact that reforms of the IMF were painful.
The minister said: “When you go through this type of adjustment of your economy, the reforms are very painful and I think they have got to be home-grown; we have got to take responsibility for this ourselves, so that when it succeeds, Nigerians are going to say, ‘yes, we did this.’
“I am not saying that the IMF is bad; I am just saying that right now, we do not see that need. We feel that this is a problem that Nigerians created one way or the other and Nigerians must solve.”
In addition, Adeosun disclosed that the Federal Government was expecting to raise at least a billion dollars from the World Bank, while she also stated that the World Bank was considering undertaking a sector specific intervention in the Nigerian power sector.
“There is some possibility of the World Bank doing some sector specific intervention in the power sector. They are working very closely with us on power. They sent in their high-level power team; they spent two very useful days with us in Abuja. We mentioned the problems of the power sector and there is the possibility of some support specifically for power,” she added.
The Minister maintained that the Federal Government was going ahead with the proposed asset sales programme, declaring that it is part of the options that the Federal Government was considering to address the country’s fiscal challenges.
She said: “You have got to look at all options when you have a fiscal challenge and when you have a budget funding gap. When you have some assets like we have that can be realized and can be put to better use, of course you have got to look at that option. And we are going to consider all options, including asset realisation.
“Talk about specific assets, no. But for asset sales as a principle; absolutely yes. That is an option. Realising unutilized assets that have value is always an option.”
Adeosun also argued that the acceptance of the country’s Eurobond showed that there is an appetite for Nigeria, which therefore, eliminates any concerns pertaining to raising money from the external capital market.
“I like the flexibility that it gives us; it means that if our fiscal position improves, we can pay down. We can put together a sinking fund to pay off our debts. I think they are adequate funds to fund what we need here,” she stated.
Furthermore, Adeosun disclosed that some banks are yet to remit monies belonging to the Federal Government to the Treasury Single Account, stating that with the whistle-blowing programme, the government had been able to picks up tips that bankers were being instructed to rename accounts when they knew that the money belongs to the Federal Government.