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IMF says Nigeria must re-calibrate its budget to lower oil prices

The International Monetary Fund (IMF) said that Nigeria must adapt its budget for 2025 to lower oil costs and increase cash transfers in order to protect the most vulnerable sections of its population.

The IMF released the results of the routine "Article IV", assessment of Nigerian economic policies. It said that the economic growth was steady, but low per capita and the inflation remained high. The Fund forecast that Nigeria's economy will grow at a rate of 3.4% in this year, and 3.2% by 2026.

Axel Schimmelpfennig is the mission chief of the Fund for Nigeria. He said: "The international economy environment in which Nigeria lives and operates is marked by very, very high uncertainty. In particular, the international oil price volatility affects Nigeria directly via the fiscal and external balances, as well as the inflation."

He said that the complex outlook makes it even more important for policymakers to maintain buffers and be nimble to react to shocks and seize opportunities.

The key challenge is now to combat high poverty and food security.

In its budget for 2025, Africa's biggest oil exporter assumed that the price per barrel would be $75. Brent crude futures were last trading at just under $68 per barrel. (Reporting and editing by Dhara Raasinghe; Karin Strohecker)

(source: Reuters)