RECESSION: Again, IMF Releases Another Disturbing Report Concerning Nigeria's Situation & It Policies
The IMF made this disclosure in its in its October 2016 Regional Economic Outlook for Sub-Saharan Africa entitled, “Multispeed Growth.” adding that economic growth in 2016 would be very slow and in fact be at its lowest level. It projected it to be 1.4% which is well below population growth, and in sharp contrast to the high growth rates of recent years.”
This was blamed by the Director, IMF’s African Department, Abebe Aemro Selassie, slump in commodity prices, tight financing and the policy response in many of the countries most affected by the shocks, “has been delayed and inadequate, raising uncertainty, deterring private investment and stifling new sources of growth.”
IMF further stated that: “Worryingly, in the face of strong financial and economic pressures, the policy response in many of the hardest-hit countries has been slow and piecemeal, often accompanied by stopgap measures such as central bank financing and the accumulation of arrears, and leading to rapidly rising public debt.
“In oil-exporting countries with flexible regimes, exchange rates have been allowed to adjust only with reluctance, resulting in strong pressures on deposits and foreign exchange reserves.
As a result, the delayed adjustment and ensuing policy uncertainty have been deterring investment and stifling new sources of growth – making a return to strong growth rates more difficult.”
Although the IMF said modest pick-up in economic activity in the region was likely, it said this would depend on strong policy action being taken to tackle the problems. Indeed, calling for prompt policy action to secure a rebound in growth, the IMF said: “A sustained adjustment effort is needed, based on a comprehensive and internally consistent set of policies.