Naira Likely To Weaken Further – Zainab Ahmed (Finance Minister)

Nigeria won’t resort to IMF over fiscal challenges

By Tony Chukwunyem

The Federal Government expects the naira to weaken further over time even after the local currency showed signs of recovering from a record low on Thursday, Bloomberg reported the Minister of Finance, Budget and National Planning, Zainab Ahmed, as saying yesterday.

According to the news agency, the minister said in an interview in Egypt that “it (naira depreciation) will happen with time,” without giving any time line.

Ahmed also reportedly ruled out Nigeria taking on an International Monetary Fund (IMF) programme to address the country’s fiscal challenges, which include plummeting revenues and rising debt service costs. The naira gained 0.0367 per cent to N435.84 per dollar on the spot market as of 5:30 p.m. in Lagos on Thursday, after recovering from a record low of N436/$1 to the greenback on Wednesday.

However, on the parallel market yesterday, the local currency dropped to N708 per dollar from N707/$1 on Wednesday. Nigeria maintains multiple exchange rates dominated by a tightly controlled official rate and the unauthorized parallel rate at which many Nigerians get dollars, which is roughly 60 per cent weaker. The World Bank and IMF have urged Nigeria to unify its rates.