The International Monetary Fund (IMF) has observed that what Nigeria requires to address tremendous shocks holding its economy back is a broad set of policies and reforms.Director, African Department of the fund, Abebe Aemro Selassie, noted that the funds engagement and discussions with Nigeria always was distilled to foreign exchange policy.What Nigeria needs is a broad set of policies and reforms to try and address this tremendous shock that has been affecting the economy. Commodity prices, of course,but also the insurgency in the North east of the country, Selassie stated at a press conference on sub-Saharan Africa at the ongoing Spring Meetings of the IMF.He added that the federal government should also address the problems in the Niger Delta that flare up from time to time.Sealssie stressed that faced with these exogenous shocks, the country needed to adjust her domestic policy mechanisms in a robust way most importantly her fiscal policy.According to the director, there is a big gap occasioned by what he described as traditionally extensive reliance on oil revenues, just as he maintained that for government operations to progress seamlessly, it is not debatable that the government needs alternative revenue policy strategies.He averred that monetary and exchange rate policies are important tools in this direction, even as he noted that given the scarcity of reserves, it was necessary that the exchange rates reflect and try to absorb the identified shocks that have resulted from lower export revenue receipts.Selassie emphasised the urgency of putting in place more flexible policies that would try to absorb the perceived shocks. But you know, how quickly you move towards that framework is something which is up to the government, he pointed out.Illicit Fund Outflows Hurting Our NationAdeosunMeanwhile, the Minister of Finance, Mrs Kemi Adeosun, has lamented the negative impact of illicit financial flows on the economy of Nigeria.These are monies that left the country and has gone abroad either through tax evasion or through money laundering.The minister made this lamentation in Washington at the ongoing Spring Meetings of the Bretton Woods Institutions, World Bank and the International Monetary Fund.She said, All the countries that are affected in the G-24 are talking about the issue of the illicit financial flows that is money that has left our country especially Nigeria and has gone abroad either through tax evasion or through money laundering.Of course we need this money back in Nigeria. And what we are working on it as a revenue initiative that would bring a lot of this money back in so that we can fund our infrastructure with the money that is due to Nigeria.Adeosun also pointed out the implication of inadequate taxation on efforts to generate sufficient fund to tackle issues of national development.Her words: We have a tax to Gross Domestic Product (GDP) ratio of six per cent which is one of the lowest in the word. It suggests largely that Nigerians are not paying the right taxes. So, now with all this co operations from international Finacial systems, the prevailing situation whereby companies aavoidnd individuals evade tax would be reversed in the positive direction.There is a lot of combat around stopping that and we believe that would support the work we are doing on revenue mobilisation. That would reduce the amount of debt that we need to take and improve our ability to fund our infrastructure projects and get our economy going. It is fundamental.Adeosun also gave an insight into the benefits of Nigerias participation in the IMF Spring meetings, saying she felt inclined to tell the gathering what she had been doing because it is very important.She said, Weve had a number of meetings, bi- lateral meetings and meetings with specific agencies. Weve had a review with the world bank looking at the banks portfolio in Nigeria, looking at how its performing and how we can improve the dispersement of world banks project within Nigeria. Weve met also with the Africa Development Bank, taking similar review, looking at projects, whats working and what is not working, what we need to improve on.We have also been meeting with rating agencies talking to them about how Nigerias economy is performing and how the implementation of our economic recovery and growth plan is expected to make this growth that we expect in 2017 sustainable. So we have a number of meetings across a number of areas since weve been here.We have a budget and a plan around medium term deck strategy which includes concessional money including the world bank essentially trying to do this.So its just one of the mix. We havent actually had specific discussions
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