- The International Monetary Fund (IMF), its latest World Economic Outlook (WEO), entitled: “Slower Growth in Emerging Markets, a Gradual Pickup in Advanced Economies,” has charged Nigeria and other emerging economies to prioritize their spending and embrace tax reform in order to overcome the current economic challenges.
- In the report, the IMF stated that in emerging markets and developing economies, macroeconomic policy space to support demand is generally more limited but should be used to the extent possible.
“In many of these economies, demand support should come from fiscal policy rebalancing aimed at boosting longer-run growth through tax reform and spending reprioritisation.
“In oil import, lower oil prices have reduced price pressures and external vulnerabilities which will ease the burden on monetary policy. In oil export, public spending should be adjusted to lower oil revenue where there is no fiscal space. Exchange rate depreciation can help to offset the demand impact of oil-related terms-of-trade losses in countries with flexible exchange rate regimes. Structural reforms to raise productivity and remove bottlenecks to production are urgently needed in many economies,” it stated.
- According to the fund, in 2016 the growth in emerging markets and developing economies is expected to pick up to 4.7 per cent largely on account of the projected improvement in economic conditions in a number of distressed economies, including Russia and some economies in the Middle East and north Africa.
- Source:Business Day