IMF Urges Nigeria to Enhance Fiscal and Monetary Reforms

The International Monetary Fund (IMF) has called on Nigeria and other major African economies to deepen reforms in fiscal policy, monetary and financial sectors, and governance to bolster macroeconomic stability and support inclusive growth. The IMF's assessment identified fiscal reforms as a high priority for Nigeria, emphasizing improvements in tax policy, revenue administration, public financial management, and spending efficiency.

Additionally, the IMF highlighted the need for Nigeria to strengthen its monetary policy framework. Following the appointment of Olayemi Cardoso as the Central Bank of Nigeria (CBN) governor in 2023, the CBN has pursued aggressive tightening measures, raising the Monetary Policy Rate from 18.75% in 2023 to 27.5% by the end of 2024.

Presidential aide Tope Fasua has suggested re-evaluating this tight monetary policy, warning that high interest rates could hinder economic growth. The IMF's recommendations coincide with Nigeria's ongoing tax reform program aimed at simplifying the tax system and improving compliance.