Nigeria seeks $7bn from IMF, others to reflate economy

Nigeria is seeking about $7.050 billion, an equivalent of N2.679 trillion, from multilateral financial institutions and the Nigeria Sovereign Investment Authority (NSIA) to mitigate the impact of COVID-19 on the economy.

A breakdown indicates that $3.4 billion is being sourced from the International Monetary Fund (IMF), $2.5 billion from the World Bank and $1 billion from the African Development Bank (AfDB) as well as $150 million to be drawn from NSIA, bringing the total to $7.050 billion or N2.679 trillion at an exchange rate of N380/$.

The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, who briefed journalists in Abuja yesterday on measures being taken in response to the COVID-19 pandemic, noted that the federal government had already applied for the release of its contributions to IMF totalling $3.4 billion under the Fund’s Rapid Credit Facility.

The country, she added, is also seeking a $2.5 billion loan from the World Bank, $1 billion from the AfDB as well as an undisclosed amount from the Islamic Development Bank.

The minister explained that $150 million would be drawn from the Stabilisation Fund of NSIA to augment the June allocation to be shared by the Federation Account Allocation Committee (FAAC) due to dwindling accruals into the Federation Account.

Explaining the moves towards seeking external interventions from multilateral institutions, the minister said: “Nigeria has a contribution of $3.4 billion with IMF and we are entitled to draw up to the whole of that $3.4 billion or less. We have in the first instance applied for that maximum amount; then in the process when we negotiate, we might get the maximum amount or less but that is the amount of our contribution with IMF and this is the provision that IMF has made for every member-country that you can apply for between 50 to 100 per cent of your contribution to IMF.

“Again, this is a programme that has no conditions attached to IMF programmes and this is not an IMF programme.”

She stated that up to about 80 countries had applied to draw from their contributions to IMF, in a bid to assuage the impact of COVID-19.

Ahmed said Nigeria has also requested from the World Bank $2.5 billion and another $1 billion from the AfDB.

The minister added that when secured, $1.5 billion of the $2.5 billion World Bank facility would go to the federal government, while the states get $1 billion.