12042019 - I N S E C U R I T Y: Buhari launches offensive; orders ruthless action

Vanguard, FRIDAY, APRIL 12, 2019 — 21
Why we want fuel subsidy
removed — IMF
...demands transparency in China loans
By Emeka Anaeto & Emma
Ujah Washington DC
The Managing Director of
International Monetary
Fund, IMF, Christine Lagarde,
has justified the call for the
removal of fuel subsidy in
Nigeria and other countries,
saying that it was a distortion
through which over $ 5.2 trillion
public funds has been lost
globally, since 2015.
Lagarde said this yesterday at
the on-going IMF/World Bank
Spring Meetings in Washington
DC, USA.
Her words: “As a general
principle, we believe that
removal of fossil fuel subsidies
is the right way to go. If you look
at our numbers since 2015, it is
not less than $5.2 trillion that
were spent on fuel subsidies and
the consequences there of.
“The Fiscal Affairs
Department actually identified
how much would have been
saved fiscally but also in terms
of human life, if there had been
the right price on carbon
emission as of 2015, the
numbers are quite staggering.
If that was to happen, then
there would be more public
spending available to build
hospitals, to build roads, to build
schools, and to support
education and health for the
people.
“Now, how this is done is the
more complicated path because
there has to be a social
protection safety net that is in
place so that the most exposed
in the population do not take
the brunt of those removal of
subsidies. That is the position
we take.
“I would add as a footnote, as
far as Nigeria is concerned that
with the low revenue
mobilisation that exists in the
country in terms of tax to GDP,
Nigeria is amongst the lowest.
A real effort has to be done in
order to maintain a good public
finance situation for the country
and in order to direct
investment towards health,
education and infrastructure.”
Demands transparency in
China loans
Responding to concerns about
the growing debt profile of
African countries, she said that
the Fund would work with other
multilateral organisations with
a view to ensuring more
transparency in terms of loans
that China has been advancing
to countries of the region.
She said: “On the debt issues,
both IMF and the World Bank
are working together in order
to bring about more
transparency and be better able
Christine Lagarde, IMF
Managing Director
to identify debts out there.
Terms and conditions, volumes
and maturity, this is an
endeavour that we will pursue
David Malpass, World Bank
President
together and which the G20 has
actually asked us to develop. So
we are doing that now.”
Lagarde added that the Fund
was working to encourage both
lenders and borrowers of such
loans to be transparent and ensure
that the terms of the loans complied
with international best practices.
“We are constantly encouraging
both borrowers and lenders to
align as much as possible with the
debt principles that have been
approved by the G20 and that we
have endorsed internally and
developed ourselves.“It is clear
that any debt restructuring
programmes going forward in the
years to come will be more
...ranks Nigeria among bottom 3 in
real GDP growth projection
•Ghana, Ethiopia, Cote d’ Ivoire lead
By Emeka Anaeto & Peter
Egwuatu
Nigeria has been
ranked among the
three least performing
economies in the sub-
Saharan Africa in terms of
the real Gross Domestic
Product, GDP, growth
projection for the year 2019,
the latest International
Monetary Fund, IMF World
Economic Outlook Report
released at the ongoing
World Bank /IMF 2019
Spring Meeting has
indicated. A total of 18
economies in the region were
rated by the report.
Vanguard’s findings from
the report show that Ghana
has been projected to have
the highest real GDP growth
rate of 8.8 percent among
the Sub Saharan countries in
the year 2019, followed by
Ethiopia with 7.7 percent and
Cote d’ Ivoire 7.4 percent
occupying third position.
The three least performers
are Nigeria projected to grow
by 2.1 percent, followed by
South Africa with 1.2 percent
and the least being Angola
at 0.4 percent.
The entire Sub Saharan
African countries have been
projected to have a real GDP
growth of 3.5 percent in 2019
from 3.0 percent in 2018.
Vanguard’s findings also
showed that Nigeria’s rank
is the second least among
the oil exporters in the
region, with the group of
five economies led by
Republic of Congo projected
to grow by 5.4 percent, Chad
by 4.5 percent and Gabon by
3.1 percent.
Commenting, Chief
Economist & Director of
Research, IMF, Gita
Gopinath, stated that growth
prospects vary across Sub
Saharan Africa, reflecting
the heterogeneity of the
economies, associated with
disparities in the level of
development, exposure to
weather shocks, and
commodity dependence.
The current
forecast
envisages that
global growth
will level off in
the first half of
2019 and firm up
after that
According to him, for the
region as a whole, growth is
projected to increase from
3.7 percent in 2020 to about
4 percent in 2024(although
for close to two-fifths of
economies, the average
growth rate over the medium
term is projected to exceed
5 percent).
“Growth prospects for
commodity exporters are
weighed down by the soft
outlook for commodity
By Peter Egwuatu
The World Bank yesterday
said that poverty is going
worsen in the developing
countries as the per capita
income growth projected for the
prices, including for Nigeria
and Angola, where growth is
expected to reach about 2.6
percent and 3.9 percent,
respectively, in the medium
term.
In South Africa, Growth is
projected to stabilize at one
three quarter percent over
the medium term as
structural bottlenecks
continue to weigh on
investment and productivity
and metal export prices are
expected to remain subdued”
he noted.
He further narrated that
after strong growth in 2017
and early 2018, global
economic activity slowed
notably in the second half of
last year, reflecting a
confluence of factors
affecting major economies.
Gopinath added that global
growth is set to moderate in
the near term, and then pick
up modestly.
He said: “As a result of
these developments, global
growth is now projected to
slow from 3.6 percent in 2018
to 3.3 percent in 2019 before
returning to 3.6 percent in
2020. Growth for 2018 was
revised down by 0.1
percentage point relative to
the October 2018 World
Economic Outlook, reflecting
weakness in the second half
of the year, and the forecasts
for 2019 and 2020 are now
marked down by 0.4
percentage point and 0.1
point respectively. The
current forecast envisages
that global growth will level
off in the first half of 2019
and firm up after that.”
complicated than debt
restructuring programmes that
were conducted 10 years ago
simply because of the multiplicity
of lenders and the fact that not all
public debt is offered by members
of the Paris Club.”
Lagarde said that IMF was
working to ensure a more
equitable and fair international
trade deals among nations of the
world, with a view to eliminating
a situation where some nations
have been taking the benefits to
the detriment of others.
World Bank projects below 1% per
capita income growth for Sub
Saharan Africa
Sub Saharan Africa including
Nigeria, is now to stay below
one percent until 2021.
The World Bank President,
David Malpass, disclosed this
at a press briefing during the
ongoing World Bank/IMF 2019
Spring Meeting in Washington
DC, USA.
He said:” Per capita income
growth in Sub-Saharan Africa,
as a whole, is now projected to
stay below 1 percent until at
least 2021, which elevates the
risk of a further concentration
of extreme poverty on the
continent. Growth in median
countries will also be weak.”
Explaining the global
economic situation, he said:
“This fact is extremely
troubling, because it
jeopardizes the World Bank’s
primary goal of ending
extreme poverty by 2030.”
According to him, on a global
scale, extreme poverty has
dropped to 700 million at the
last count, that’s down from
much higher levels in the 1990s
and 2000s.
But he added that the number
of people living in extreme
poverty is on the rise in Sub-
Saharan Africa.
He stressed that the
situation calls for urgent
action by countries
themselves, and by the global
community.
However, he stated: “The
World Bank Group is
financially strong. And with
the capital package which was
agreed to a year ago at the
Spring Meetings, and which
I was proud to support – the
organization is becoming even
more responsive, efficient, and
effective. This week we at the
World Bank Group have joined
the IMF in welcoming our 189
shareholders to the Spring
Meetings. I have already
begun meeting with member
countries and other
stakeholders to discuss the
challenges ahead, and to
advance the broader global
development agenda.”
Malpass, noted that the
World Bank Group plays an
increasingly vital role in
leading on global challenges
that people face in developing
countries.