Edun Warns Interest Rate Hikes May Undermine Reforms

Wale Edun, Nigeria's Minister of Finance, warned during the G24 conference held alongside the International Monetary Fund meeting in Washington D.C. that aggressive interest rate hikes could weaken ongoing economic reforms in developing countries, including Nigeria. He noted that such premature increases could undermine policy responses and fuel inflation.

Edun urged developing economies to adopt proactive strategies to mitigate the effects of global economic disruptions. He highlighted the delicate balance central banks must strike in responding to inflationary pressures without stalling reform momentum.

While oil-exporting nations like Nigeria may benefit from higher crude prices, they also face rising import bills and inflation driven by volatile energy markets. Edun stressed the importance of fiscal buffers and targeted temporary support measures for vulnerable populations, cautioning against reverting to subsidy regimes.

He advocated for stronger domestic resource mobilization, improved tax systems, and deeper private sector participation to enhance Nigeria's economic framework despite external shocks.