IMF urges FG to remove fuel subsidy June 2023

Oluwanifemi Ojo
Oluwanifemi Ojo
International Monetary Fund

The International Monetary Fund has implored the Federal Government to fulfil its plans to remove fuel subsidy by June.

The prominent financial agency of the United Nations, IMF stated this on Wednesday in a publication on their website titled ‘IMF Executive Board Concludes 2022 Article IV Consultation with Nigeria.’

The publication highlighted that Nigeria’s economy has recovered the output losses encountered during the COVID-19. This is due to encouraging oil prices and good  consumption activities.

“Despite rising oil prices, the general government fiscal deficit is estimated to have widened further in 2022, mainly due to high fuel subsidy costs, IMF said.

“While the current account is estimated to have improved in 2022, foreign currency reserves declined amidst capital outflow pressures.”

To establish the necessary policy space, secure the public debt, and lessen risks, the IMF advised the government to implement strong fiscal reforms.

According to the report, “the government needs to take decisive fiscal and monetary tightening to secure macroeconomic stability, combined with structural reforms to improve governance, strengthen the agricultural sector, and boost inclusive, sustainable growth.”

The Punch reported that IMF urged the authorities to fulfill their promises to remove fuel subsidies by June, 2023.

Also, to raise social spending that is carefully targeted. Priority should also be given to enhancing tax compliance, expanding the tax automation system, and strengthening taxpayer segmentation in order to increase revenue mobilization.

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