The Managing Director of the International Monetary Fund (IMF), Christine Lagarde, has called for a flexible exchange rate regime as she described the Nigerian economic situation as alarming.
Lagarde while speaking on the World Bank/IMF special edition of BBC’s HardTalk anchored by Stephen Sackur, said Nigeria has huge potential, especially in her youth.
She added that the IMF was ready to lend a helping hand to the country, asking the President, Muhammadu Buhari to put steps in place to move in the direction of “flexible exchange rate”.
“We are not suggesting that flexible exchange rate is the panacea in all cases, but in this particular instance, we believe that it would help,
“I know it is going to be difficult, and we very much hope that the Nigerian government under the leadership of President Buhari will be able to distinguish the value of moving in that direction, rather than causing the circumstances that can precipitate, a much more difficult decision making process at some stage.
“We remain completely available to help, we believe that it is doable, it can be addressed.”
Lagarde added that the country has been blessed with huge potentials adding that: “Nigeria has very strong resourceful and great people. The right policy mix is needed, which include, in our view, flexible exchange rate,”
She continue that: “Nigeria is one of those countries where there’s huge potential, fantastic youth but also a very alarming economic situation. It is heavily dependent on the oil resources.
“Both in terms of fiscal revenue and exports. As a result of that, we have gone public and actually gone to the senate of Nigeria to explain our views, we believe that a more flexible exchange rate is in the interest of the Nigerian population.
“If that doesn’t happen, we would continue to see the dual exchange rate, and putting in place a list of those product and services that are forbidden in Nigeria for import purposes, cannot be a substitute to a more flexible exchange rate.”