Lagarde arrives Nigeria as President Buhari struggles to save the economy

Nigeria’s president Muhammadu Buhari’s two major tasks are ending corruption and reviving the economy, tasks if well done would translate into achievements in other areas of governance. But while he seems to have the corruption fight all figured out, President Buhari has been faltering in the economic space. He will be looking forward to the visit of the Managing Director of the International Monetary Fund (IMF) during January 4–9, 2016 who will engage with policy makers and other stakeholders in the country. Lagarde has arrived Nigeria.

According to the Fund, Lagarde will also visit Cameroon during the period as she seeks to underline the IMF’s strong relationship with its African member countries.

“Nigeria is working hard to improve its business environment, promote opportunities for growth in the private sector, and strengthen social cohesion, all areas where the government has an important role to play,” said Lagarde, ahead of her trip.

“I look forward to productive meetings with President Buhari and his colleagues as they address important economic challenges, most importantly the impact of low oil prices,” the IMF boss added.

In Abuja, Ms. Lagarde will also meet with business leaders, prominent women, and representatives of civil society, as well as the legislators.

President Buhari had towards the end of 2015 announced a 2016 budget which is a new record. According to the budget, deficit will double to N2.2 trillion ($11 billion) as capital expenditure triples in a bid to help the country adjust to a regime of lower revenues from oil. The country plans to fund the deficit with foreign debt of N900 billion and N984 billion to be borrowed at home.

Nigeria’s currency has also been hit by the slump in global oil prices as the commodity accounts for over 90 percent of foreign exchange. There has been calls for the devaluation of the naira as the gap between the official rate and the black market rate remains wide. Efforts to hold the currency’s value is also hurting other sectors of the economy. However, President Buhari has insisted on allowing the status quo remain until he is convinced that devaluation is the right step to take. The IMF had in October, 2015 advised the country to devalue the naira. This may come up again in Lagarde’s discussion with Nigeria’s president.

The IMF Managing Director will also meet Cameroon’s President Paul Biya and his economic team, as well as private sector executives, women leaders, and other members of Cameroonian society.

“As the largest and most diversified economy in CEMAC, Cameroon is well placed to sustain, and reinforce, the momentum of integration,” Ms. Lagarde said. She will also meet with Finance Ministers from the six member countries of the Economic and Monetary Community of Central Africa (CEMAC).