IMF has never been a friend
Many Nigerians literally had their hearts in their mouths when the four-day visit of the Managing Director of the International Monetary Fund (IMF), Mrs Christine Lagarde, to the country was made public. Of course they had their reasons; and genuine ones at that, too. Nigeria, like many other developing countries, see the IMF as an anathema.
Nigerians have not forgotten their experience with the Paris Club to which their country was perpetually indebted and remained trapped in debt for decades until it managed to wriggle out of it when on June 29, 2005, the club and Nigeria agreed on an US$18 billion debt relief package with the Obasanjo administration.
With specific reference to the IMF, the country roundly rejected the idea of the country taking a loan facility from it in the Babangida era. It was a big debate in which Nigerians gave a resounding NO for an answer!
However, Mrs. Lagarde eventually arrived Nigeria on Monday for a four-day visit, as part of a two-country tour of the West African region. She concluded her visit to the country on Thursday.
Indeed, it was as if the IMF boss had anticipated that Nigerians were going to think her visit would not be unconnected with talking the Federal Government into taking loans from the fund in view of the country’s dire economic situation. Hence her quick repudiation of any such agenda as soon as she came, even as she added that the country did not need loan to get back on track.
So far, her visit has been a mixed blessing; at least given what is in the public domain about it. Expectedly, she supports the removal of fuel subsidy. She also said the IMF would be more than ready to assist Nigeria in its efforts to plug revenue leaks, trace stolen funds, and to restructure the nation’s taxation system. These are laudable objectives.
One of the country’s problems is that a lot of public funds are diverted into private pockets. Revelations from the investigations into the $2.1billion arms fund lend credence to this. Moreover, a chunk of the country’s stolen funds is stashed in banks abroad and the IMF boss sure knew what she was saying when she assured that her bank would help trace some of these funds.
This year alone, the Federal Government hopes to rake in some billions of the looted funds. Then the area of restructuring the country’s’ taxation system so as to bring in more eligible individual and corporate entities that should be paying taxes but are currently out of the tax net is a good step which would make more money available to the government for developmental purposes.
All said, Mrs Lagarde might have come and left, the point is that we also know where the shoes pinch. We know how we got to our present mess. We therefore do not necessarily need any outsider to come and show us the way out of the woods. And if at all there must be such advice, it must be one that would point the way forward and not one that would further get us deeper into crisis.
In effect, while the Federal Government should be careful about accepting wholesale the suggestions by the IMF boss, the bottom line is for the government to refuse to accept dictation by the IMF managing director on things that would be injurious to our economy. The Federal Government must sift the wheat from the chaff.
We should not forget the experiences of some other countries that swallowed, hook, line and sinker, the policies enunciated by the IMF in the past only to be worse off. Indeed, the fund has had to apologise to some of these countries for prescribing antidotes that exacerbated, rather than ameliorate their suffering. Nigeria should avoid falling into such one-cap-fits-all traps.