IMF reassures Nigeria on $3.4 billion credit facility request

The International Monetary Fund (IMF) has replied that there are plans to pay quick attention to Nigeria’s loan request of $3.4 billion credit facility in support of the battle against the pandemic disease in the nation.

According to Kristalina Georgieva, IMF managing director, the impact of COVID-19 left a ripple effect on the economy. The shocking fall in international crude oil prices as badly threatened the nation’s economy.

Since the outbreak of Coronavirus, a barrel of crude oil now sells for about $30 which is 59% lower than the 2020 appropriation act benchmark price a barrel selling for $57.

On Monday, Zainab Ahmed the Minister of Finance, Budget and National planning stated that due to the crippling reality of the outbreak of the pandemic disease, the 2020 appropriation act that was based on some fiscal assumptions have been re-examined.

This was briefed during the launch of the 500 billion stimulus package another measure to fight COVID-19. Since the outbreak in Nigeria, the nation’s economy is threatened as projected oil revenues are shaken.

The federal government had to re-examine the benchmark oil price for the year. The price has been slashed from $57 to $30 dollar per barrel and oil production dropped to 1.7 million per barrel.

Zainab Ahmed, the Finance Minister disclosed that the government is set to adjust downwards, customs receipts, several taxes, earnings from privatization exercises and other non-oil revenue projections.

According to the IMF, the Buhari Administration has taken several measures to break the infection cycle of the virus and reduce its blow on the economy.

Measures such as disbursing contingency funds to NCDC, economic stimulus package as a relief to citizens during these trying times, and businesses struggling with the unforeseen global economy crisis.

In order to support these measures, the federal government requested a loan from the IMF under the Fund’s Rapid Financing Instrument (RFI). This emergency loan will help the federal government with pressing balance of payments needs and give assist policies that will ensure money is disbursed for health expenditures and also support vulnerable citizens and struggling businesses.

The finance minister also shared on the request of $2.5 billion from the World Bank and $1 billion from the African Development Bank. Also $150 million from the Nigerian Sovereign Investment Authority. This particular one is a fund set aside to help salvage the economic recovery plans of the government in times of unprecedented emergencies.