The Executive Board of the International Monetary Fund (IMF) has approved the $3.4 billion requested by the Federal Government for emergency support.
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The amount represents the total special drawing right (SDR) Nigeria holds with the international lender. The disbursement is also the highest to be approved for any African nation so far.
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Mitsuhiro Furusawa, deputy managing director and acting chair of the IMF executive board, commended the “immediate action” taken by the federal government to respond to the COVID-19 crisis.
“The short-term focus on fiscal accommodation would allow for higher health spending and help alleviate the impact of the crisis on households and businesses,” he said.
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“Steps taken toward a more unified and flexible exchange rate are also important and unification of the exchange rate should be expedited.
“Once the COVID-19 crisis passes, the focus should remain on medium-term macroeconomic stability, with revenue-based fiscal consolidation essential to keep Nigeria’s debt sustainable and create fiscal space for priority spending.
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“Implementation of the reform priorities under the economic recovery and growth plan, particularly on power and governance, remains crucial to boost growth over the medium term.”
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Furusawa said the emergency funding will provide the liquidity needed to respond to urgent balance of payments needs.
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