The World Bank has thrown its weight in support of the Federal Government’s subsidy removal and the exchange rate unification.
Speaking at an event organised by the World Bank to assess Nigeria’s economy in the last six months on Tuesday, Country Director, Dr Subham Chadhuri, explained that the policy though painful remains key to rebuilding the economy of the nation.
Mr Chadhuri, however, advocated measures that will reduce the impact on the people going forward.He further stated that the World Bank’s concessionary funding to Nigeria currently stands at over $10 billion.
Also speaking, a lead economist at the World Bank, Alex Seinart, said the removal of the fuel subsidy is projected to achieve estimated fiscal gains of about N3.9 trillion in 2023.
The gains according to him, are expected to reach over N21 trillion between 2023 to 2025.
The economist further projects that the petroleum subsidy removal is likely to lead to an increase in inflation in the upcoming months before contributing to disinflation in the medium term.
On the exchange rate, the senior economist at the World Bank said that the previous foreign exchange management approach impeded investment and growth, contributed to inflation and undermined the efficacy of monetary and fiscal policies.
