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Between IMF, World Bank Reforms and Buhari’s Home-Grown Data

-By Benjamin Ike

Penultimate Wednesday the World Bank and International Monetary Fund (IMF) made case for urgent structural reforms to fast-track Nigeria’s economic recovery even as President Muhammadu Buhari faulted the statistics produced on Nigeria by the two foreign bodies, describing them as wild estimates.

The President therefore charged members of the Presidential Economic Advisory Council (PEAC) which he co-incidentally inaugurated the same day to develop local content data base and make accurate economic data gathering its primary focus.

There have been, however, mixed reaction by economists following the call by the Bretton woods institutions. The World Bank in the 20th edition of Africa’s Pulse, its bi-annual economic report for the Region which was launched October 9th, said the recovery in Nigeria, South Africa and Angola – the Regions three largest economies – had remained weak and is weighing on the Region’s prospects.

This edition of Africa’s Pulse include special sections on accelerating poverty reduction and promoting women’s empowerment.

“In Nigeria, growth in the non-oil sector has been sluggish, while in Angola the oil sector remains weak. In South Africa, low investment sentiment is weighing on economic activities”, the bank said.

It said initiatives to empower poor people, girls and women are essential to progress.

According to Mr. Hafez Ghanem, World Bank Vice President for Africa, “Empowering women will help boost growth. African policy makers face an important choice, business as usual or deliberate steps toward a more inclusive economy.

After several years of slower-than-expected growth, closing the opportunity gap for women by removing barriers in their economic participation is the best way forward.”

Nevertheless, said the report: “Excluding Nigeria, South Africa and Angola, growth in the rest of the sub-continent is expected to remain robust although slower in some countries”. It noted that overall growth in the region is projected to rise to 26 percent.

Meanwhile President Buhari who faulted the foreign statistics produced by IMF and World Bank describing them as “wild estimates” had tasked members of the Professor Doyin Salami – led newly inaugurated eight-man council to come up with data that will be a true reflection of the state of events in the country.

The President had announced membership of the council on November 16, naming Dr. Muhammed Sagagi, Prof. Ode Ojowo, Dr. Shehu Yahaya, Dr. Iyabo Masha, Mr. Bismark Rewane, Dr. Mohammed Adaya Salisu, and Prof. Chukwuma Soludo as members, charging the council to develop local data base and make accurate economic data gathering its prime focus.

According to the President, developing local content statistics had become imperative because statistics relied upon for measuring the nation’s performance indicators were developed abroad by the World Bank cum IMF.

Urging team to set an agenda on what it wants to achieve in the shortest possible time, the President called the team’s duties “most important national assignment”.

Notwithstanding, the Chief Economist and Director of Research of IMF, Gita Gopinath during a media briefing on the October 2019 World Economic Outlook at the IMF/World Bank meeting in Washington D.C on October 15, said the development bank supported Central Bank of Nigeria’s (CBN) tight monetary policy and simpler unified exchange rate system, insisting that this would alleviate the foreign exchange restrictions that had also been distorted by public and private sector decisions and holding back of investments.

“More generally, strengthening the banking system resilience and continued structural reforms, especially in infrastructure and power sector and broader governance remain critical,” she added.

Gopinath expressed concern about the low level of per capita income in Nigeria just as she reiterated the need for a comprehensive reform package in the country.

According to her, the fate of the Nigerian economy depends largely on the volatility of crude oil prices.

“One thing to keep in mind about Nigeria is that the per capita growth remains weak and this is why we are talking about restructuring and reforms,” Gita Gopinath stated.Division Chief, Research Development of IMF, Oya Celasum also said the multilateral institution had earlier in the year reviewed upward Nigeria’s growth due to strong agricultural production. “But that growth is not high enough to lift the per capita growth into positive territory. For some time, we have been emphasizing on a comprehensive package to lift growth.

One element of that would have to be stronger non-oil revenue mobilization as Nigeria has one of the lowest rates of revenue in the world, which was hit hard by the drop in oil prices.

“That is essential for the country to be able to spend more on priorities such as social safety and infrastructure,” Colasun maintained.