11 January 2016

Nigeria: NLC Tackles IMF Chief Over Subsidy Removal, Naira Devaluation

Abuja — Following the visit of the International Monetary Fund (IMF) Managing Director, Christine Lagarde, to Nigeria last week, the Nigerian Labour Congress (NLC) yesterday took a swipe at the IMF boss over her recommendations to the Nigerian government calling for fuel subsidy removal and the devaluation of the naira.

In an exclusive interview with THISDAY, NLC President, Comrade Ayuba Wabba, explained that most engagements by IMF chiefs are shrouded in secrecy to the detriment of Nigerians currently facing the brunt of economic hardship. Lagarde in Abuja last week, while urging the President Muhammadu Buhari-led All Progressives Congress (APC) government to tinker with fuel subsidy, had argued that "fuel subsidies are hard to defend," stating that they "harm the planet" as "only seven per cent of the benefits go to the poorest 20 per cent." Statistics, Wabba said, do not conform with present realities in Nigeria.

"I am not sure those statistics are correct. Everyone in Nigeria is depended on oil and gas. Therefore, people will not be able to pay more. Our viewpoint is that the primary purpose of government is comfort. So who will benefit from subsidy removal? "We can do a lot of other things so that citizens don't suffer. The truth is IMF is about servicing the capitalists. So the recommendation of the IMF chief for subsidy removal is to make us continue to buy refine petroleum products from them (the West)," Wabba said. The NLC president informed THISDAY that Nigerians would be paying more as they would be at the receiving end, adding: "She came too with two lines of arguments. She is still saying that we should continue to devalue our naira. This is the logic." Wabba accused Lagarde of some sinister moves given that she has always visited Nigeria immediately when there is a change of government.

"I am not surprised at her visit" Wabba told THISDAY, stating: "In 2011, immediately former President Goodluck Jonathan took over, she visited Nigeria. And the government heeded to her demands and went ahead to remove the subsidies. Remember what happened? Nigerians protested. Again, Nigerians are not going to pay more. "We are being told now that America wants to start exporting its oil; Iran will also resume export. Our oil price will continue to fall. Even the problems we are facing today, IMF and World Bank put us there. Since then our naira has not stabilised. They have conditionalities which are hidden." He maintained that Lagarde's advice to Nigeria would be inimical to the economic well being of Nigerians and will worsen the present situation.

"Her advice is not going to take us anywhere. IMF cannot point to anywhere in the world where any good example of its policy has worked; either in other parts of the world or Africa where their conditionalities has worked.

"In most of her engagements, she didn't make those conditionalities known. The aim is to tie Nigeria to foreign creditors, NLC will not accept this. We want to make it clear that Nigeria is not in short supply of economists who can run our economy," Wabba submitted. Opposition to recommendations by the IMF chief to Nigeria has continued to receive criticisms, with many expressing concern over calls by the international body for Nigeria to discard fuel subsidy and devalue its currency.

Lagarde, who visited Nigeria last week, had several high power meetings with the Nigerian president, the National Assembly and other key players in the financial and economic sectors. The visit has elicited suspicion over IMF growing calls for fuel subsidy removal, an idea that has been strongly opposed by a larger population of Nigeria.

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