The World Bank has urged the federal government to maintain the ongoing economic reforms, cautioning that reversing them could have detrimental effects on the country.
Among the key policies implemented by President Bola Tinubu’s administration upon taking office were the removal of the fuel subsidy and the elimination of multiple foreign exchange systems.
While the government has consistently defended these changes, many Nigerians have voiced concerns about their impact on everyday life.
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Since the subsidy was removed, the pump price of fuel has surged from N198 to over N1,000, and the naira, which was trading below N600 to the dollar, has now surpassed N1,700 in the parallel market.
At the launch of the Nigeria Development Update (NDU) report in Abuja on Thursday, World Bank Country Director for Nigeria, Dr. Ndiame Diop, acknowledged that although the reforms may lead to short-term hardship, they are crucial for the nation’s long-term stability.
He warned, “Reversing these reforms would be detrimental and would spell doom for Nigeria.”
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Similarly, Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, reiterated the federal government’s commitment to sustaining its reform agenda.
“Any effort that is not sustained will be a waste. Together with the Governor of the Central Bank of Nigeria and the Minister of Budget and National Planning, we’ve been discussing how to stay on course, tackle inflation and ensure we move in the right direction.”
Edun elaborated that the government’s priority is to reduce inflation while attracting investments into key sectors like industry, where job creation is essential. He noted that significant investments are anticipated in the near future.
This isn’t the first time the World Bank has expressed such views on Nigeria.
At the recent 30th Nigerian Economic Summit (NES30) in Abuja, Mr. Indermit Gill, the World Bank’s Senior Vice President and Chief Economist, encouraged the Tinubu administration to maintain its reform efforts despite the challenges faced by citizens.
He emphasized that Nigeria needs the next 10 to 15 years to position itself as a leading economic power in sub-Saharan Africa and on the global stage.
However, Andrew Mamedu, the Country Director of ActionAid Nigeria, criticized this perspective, arguing that the World Bank chief’s remarks were dismissive of the millions of Nigerians enduring unprecedented economic hardship.