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IMF: Lower Inflation, Stable Exchange Rates Key to Attracting Investors

Ari Aisen, the Resident Representative for the International Monetary Fund (IMF) in Nigeria, emphasized that lower inflation rates and a more predictable exchange rate would be instrumental in attracting increased investments into the country. Aisen made these remarks during an appearance on Arise News Television’s Global Business Report show.

He stated, “If inflation can be reduced and the exchange rate made more stable, Nigeria can become a more attractive destination for investments. There are indications of potential growth for the country. The country’s potential has always been there and will continue to exist.”

Aisen also highlighted the importance of the Nigerian government implementing policies aimed at reducing its financing requirements. He specifically mentioned the removal of fuel subsidies as a significant step, noting that these subsidies had cost the country approximately two percent of its GDP the previous year and had contributed to the government’s financing needs and debt burden.

The IMF representative cautioned against reversing such policies, emphasizing that the ongoing economic transition was likely to be beneficial for the Nigerian economy.

He acknowledged that Nigeria was going through a transitional period, which might involve some challenges. However, Aisen stressed the need to protect the poor and vulnerable segments of the population from the adverse effects of this transition. He called for a joint effort by the government and the private sector, particularly the elite, to develop solutions that would shield the most vulnerable members of society from hardship.

Aisen pointed out that once this transition phase was successfully navigated, foreign and local investments would likely return to the country, instilling confidence and leading to job creation. He emphasized the importance of inclusiveness in this process, ensuring that everyone in society benefits from high growth rates and job opportunities.

Regarding Nigeria’s total debt, which exceeds N87 trillion, Aisen noted that it still fell within a moderate range for any country. He encouraged Nigerians to focus on addressing the underlying issues driving this substantial debt load rather than fixating solely on the debt itself.

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