Nigerian finance minister hints at borrowing more money from IMF despite servicing its current debt

Nigerian Minister of Finance, Budget and National Planning, Zainab Ahmed, has unveiled his intention to take advantage of the newly created IMF fund.

She made the announcement following Wednesday’s IMF and World Bank meetings in Washington DC.

However, the finance minister pointed out that her office has engaged financial institutions to review the country’s debt portfolio to restructure and further lengthen the debt service period to provide more tax relief.

“It is a fact that Nigeria’s debt has been increasing over the last three to four years, and this increase in debt has been brought about by the different types of exogenous shocks that the country has faced, which is not not unique to Nigeria,” she said.

Speaking on the potential for negotiations with the IMF, the finance minister noted that the viability of the relief fund offered by the IMF will determine whether the Nigerian government will accept the loan.

“The latest draw we have had from the IMF is the second round of Special Drawing Rights (SDRs) which has been provided to all member countries. The IMF recently proposed a food security package that countries can draw on, and this is equivalent to about 50% of their SDRs. She stated.

“We didn’t decide to take advantage of that. We need to look at the requirements, terms and conditions, to see if it will be safe for us to tap because we don’t want to be dragged into an IMF program. She added.

“If they work for us, we will now decide to take it as the funds can certainly be useful in increasing our reserves and dealing with the challenges the country is facing.”

The finance minister also talked about debt restructuring and how a huge chunk of the country’s revenue next year will be allocated to servicing the debt.

“Unfortunately, the cost of servicing debt is rising due to rising interest rates globally, which is driving up debt servicing costs. Our projection from the debt sustainability analysis is that Nigeria can meet its debt service. said Zainab Ahmed.

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