Nigeria

IMF Cautions Nigeria On Rising Debt Profile From China

BY NKECHI NAECHE ESEZOBOR IN WASHINGTON DC—The International Monetary Fund (IMF) has cautioned Nigeria against the rising debt profile, especially from China.

The IMF also frowned over debts in Nigeria and other sub-Saharan Africa, addong that they don’t pass through the Paris Club, adfing that they pose greater risks and creating vulnerabilities.

The IMF disvlosed this responding to media questions from journalists after the presentation of Global Financial Stability Report, Evan Papageorgiou, by Deputy Division Chief, Monetary and Capital Markets Department.

The fund noted that the issue of non-Paris Club creditors is one of the issues that was identified as potentially creating some instability or some vulnerabilities.

“Not that the debt itself creates problems. We examine some issues that debt has to be used for productive purposes but usually debt that is given under non-Pan’s Club or multilateral types of agreements, more broadly in a lot of low-income countries, particularly a lot of Sub-Saharan African countries, the issue of debt vulnerabilities is becoming more and more prescient.”

“The IMF’s evaluation, in more than a dozen counties that are either in distress or in high risk of debt distress.’’ He also noted there are the issues again of either collateralization of that debt or the type of this debt may create a more difficult way of resolving it down the line through a debt restructuring, for example.”

The fund however assured that financial conditions in Nigeria looks favoured for more foreign investments in 2019.

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