THE Director-General, Budget Office of the Federation, Ben Akabueze, has said Nigeria may seek relief from the International Monetary Fund (IMF) if it is unable to address its fiscal challenges.
Akabueze made the statement this morning on Arise TV’s Global Business Report when he was responding to concerns on Nigeria’s debt and spending patterns.
The programme was anchored by Rotus Oddiri.
He said that although Nigeria was currently not at the point of seeking a bailout like a few distressed countries, it might resort to that option if the need arose.
The DG said, “Essentially, there are two ways countries end up with the IMF. One is voluntary when they ask 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 if we don’t address our fiscal challenges in a sensible and sustainable matter, we may end up unwillingly with the IMF.”
Nwabueze said it was time for the nation to start considering 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 reiterated that the nation was facing severe fiscal challenges, which should be addressed.
Nwabueze, while recommending removal of petroleum subsidies in the long term, advised that gains from the removal should be redirected to unlocking investment potentials in the oil sector.
He stressed it was unreasonable to keep exporting crude without refining it more than 60 years after oil exploration and production began in the country.
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