Recession, difficult times here – IMF, Senate

• IMF says combination of plunging oil revenues and weakened investor confidence will push economy into recession
• Now says economy will contract by 1.8 percent this year, after having forecast in April a 2.3 percent expansion
• Senate says Nigeria has, indeed, entered into difficult times going by the reports tabled before it by CBN Governor
• ‘Information given by Emefiele too explosive, not good for public consumption’
• Finance Minister to brief Senate on current developments today

The International Monetary Fund (IMF) slashed its growth forecast for the Nigerian economy this year on Tuesday, saying a combination of plunging oil revenues and weakened investor confidence will push it into recession.

In its revised World Economic Outlook (WEO), the Fund said it expects Africa’s largest economy to contract by 1.8 percent this year, after having forecast in April a 2.3 percent expansion.

The revised WEO was released by the Fund, just as the Nigerian Senate on Tuesday admitted that Nigeria has, indeed, entered into difficult times going by the reports tabled before it in a closed session by the governor of the Central Bank of Nigeria (CBN), Godwin Emefiele.

Unveiling the revised outlook, Maury Obstfeld, IMF economic counsellor and director of the research department, said in a speech titled ‘A spanner in the works: WEO Update Opening Statement’ that the Brexit vote had thrown a spanner in economic growth.

Nigeria’s stall, and sluggish activity in the number two economy, South Africa, is expected to pull down economic growth across sub-Saharan Africa, the IMF said, forecasting a “dramatic implication.”

“In 2016, regional output growth will fall short of population growth, implying declining per capita incomes,” it said.

Meanwhile, the Senate on Tuesday stressed the need for urgent steps to be taken on salvaging the national economy currently facing the challenges of recession

It acknowledged the pains being faced by many Nigerians owing to the dwindling fortunes of the economy as reflected by poor indices of growth in the first quarter of this year.

Last week, the Secretary to the Government of the Federation, David Babachir had hinted that projects listed in the 2016 budget may not be fairly implemented due to paucity of funds to finance them The problem, he reasoned, had prodded the Federal Government to embark of project prioritisation in which case those considered of immediate benefits to the survival of Nigeria would be given prompt attention at the level of implementation.

The Minister of Budget and Planning, Senator Udo Udoma had echoed similar position when he briefed a Senate committee a few days ago.

Against this background, the Finance Minister, Kemi Adeosun is scheduled to face the Senate during plenary today as part of moves by the Upper Chamber to rub minds with her on way out of economic doldrums currently being suffered by Nigeria.

The Senate expressed regrets over the current state of the Nigerian economy after it had a closed door session with the Governor of the Central Bank, Godwin Emefiele which lasted close to two hours.

The CBN governor had briefed senators on the state of economy in line with earlier resolution passed to that effect in May this year.

In a statement issued by the leadership of the Senate, after the CBN governor’s briefing, the Senate admitted that Nigeria has, indeed, entered into difficult times going by the reports tabled before it by the CBN governor.

The Vice Chairman on Media and Publicity Committee, Senator Ben Bruce during a media briefing said some of the information offered by the CBN were never good for public consumption on the basis that they are explosive.

The Press statement read, “Following an exhaustive response by the CBN governor and his team, the Senate acknowledged that these are indeed difficult times all over the world and not just Nigeria.

“The Senate also acknowledged the pains that many Nigerians may be facing at this time, especially in the light of increase in price of electricity and fuels”.

Senate’s leadership in the statement added that senators at the briefing raised issues concerning the banking system, the slippage in economic growth for the first quarter of 2016, the gradual rise in inflation, fall in foreign exchange reserves and policy coordination between the fiscal and monetary authorities.

The Senate however in the statement expresses its strong conviction that going by policies already put on ground by the CBN that the nation’s ailing economy would eventually come out of the woods.

It said: ‘ Having carefully considered the policies of the CBN, the senate would like to commend and support these policies because they are mostly geared towards increasing local production, creating jobs here in Nigeria, safeguarding our commonwealth and expanding economic opportunities and growth in Nigeria.

“The Senate believes strongly in the resilience of the Nigerian economy and the ingenuity of the Nigerian people and as such, confident that we will all pull through these difficulties and come out as much better, equitable and prosperous nation”.