IMF charges Nigeria on prudent spending, fiscal reforms to ensure economic stability

• The International Monetary Fund charged Nigeria on prudent government spending
• It commended the country’s recent tough economic reforms
• The IMF said fiscal policy is essential for long-term economic growth

 The International Monetary Fund (IMF) has called on the Nigerian government to spend prudently and strengthen its fiscal institutions to ensure long-term economic stability.

The charge was given by Davide Furceri, the Division Chief for Nigeria in the IMF’s Fiscal Affairs Department, on Wednesday, April 23, at the fiscal monitor press briefing during the 2025 IMF/World Bank spring meetings in Washington, DC, United States.

Furceri lauded Nigeria’s tough economic reforms, which he said have led to improved fiscal savings, but stressed the need for prudent and strategic government spending.

He noted that Nigeria should boost revenue through improved mobilisation strategies, while also increasing spending in key sectors like social protection and infrastructure development.

“Nigeria managed to do a very difficult reform that was important in delivering fiscal savings.

“That said, we understand that many countries, including Nigeria, face pressing spending needs.

“But spending must be done wisely; this means stronger prioritisation and greater efficiency in how resources are allocated.

“One key message not just for Nigeria, but for many countries, is the importance of strong fiscal institutions. Medium-term fiscal frameworks and solid public financial management systems are essential.

“They provide a fiscal anchor to guide necessary adjustments and help reduce uncertainty. We want fiscal policy to be a source of stability, not a source of volatility,” Furceri said.

IMF says fiscal policy is essential for economic growth

The Director of the IMF’s Fiscal Affairs Department, Vitor Gaspar, spoke on the urgent need for fiscal authorities and governments to strengthen policies for economic growth.

He said fiscal policy should instil confidence and stability, supporting a competitive economy that fosters inclusive growth and prosperity.

“This is especially important in a situation that tests the resilience of individual economies, not to mention the entire system.

“Putting house in order involves three policy priorities. First, fiscal policy should be part of overall policies.

“Secondly, fiscal policy should, in most countries, aim at reducing public debt and rebuilding buffers to create space to respond to spending pressures and other economic shocks through a credible medium-term framework.

“Thirdly, fiscal policy should, together with other structural policies, aim at improving potential growth, thereby easing policy trade-offs in these times of high uncertainty,” Gaspar said.

IMF says Tinubu’s economic reforms yet to benefit Nigerians

Meanwhile, TheRadar earlier reported that the International Monetary Fund (IMF) said the President Bola Tinubu-led Federal Government’s tough economic reforms have not yet benefited the average Nigerian after nearly two years of their introduction.

The IMF disclosed this in a statement on Friday, April 18, by the IMF Mission Chief for Nigeria, Axel Schimmelpfennig.