IMF’s austerity measure will inflict more poverty on Nigeria, others

Oxfam International has warned the International Monetary Fund (IMF) against playing double standards in its approach to addressing poverty through its demand that developing countries, including Nigeria, implement austerity measures in their economic policies.

Recently, IMF Chief, Kristalina Georgieva, urged Europe not to endanger its economic recovery with the ‘suffocating force of austerity’. Yet, over the past year, the IMF has gone back to imposing austerity measures on lower-income countries.

A press release sent by Oxfam in Nigeria through its Communications Officer, Rita Abiodun, quoted Senior Policy Advisor, Oxfam International, Nabil Abdo saying, “this epitomizes the IMF’s double standard,” adding that, “it is warning rich countries against austerity while forcing poorer ones into it.”

He said, the pandemic is not over for most of the world, and rising energy bills, and food prices are hurting poor countries most.

Instead, he stressed, “they need help, boosting access to basic services and social protection, not harsh conditions that kick people when they are down.”

Dr Vincent Ahonsi, Country Director of Oxfam in Nigeria said, “Nigeria is a country of spectacular inequity and an astounding level of poverty which cannot afford the IMF’s austerity bill as that could further worsen inequality and plunge more Nigerians deeper into poverty.

“Instead, the IMF needs to stop selling its austerity ideas to Nigeria and facilitate easier access to emergency financing for socioeconomic infrastructure and human capacity development,” he added.

He advised that the agency also needs to encourage Nigeria Government to lessen the burden on 99 percent of the people who happen to be at the bottom of the pyramid and tax the super-rich one percent more appropriately through a progressive regimen.

“To help Nigeria and the majority of Nigerians who are daily finding it more difficult to meet their basic human needs, the IMF should lead the conversation on how Nigeria will suspend its huge debt servicing costs, as a pathway towards a comprehensive debt relief for the country. That way the IMF will be working for a fairer today and a better tomorrow for Nigeria and Nigerians,” said Ahonsi.

As much as 87 percent of the IMF’s Covid-19 loans are requiring developing countries that have been denied equal access to vaccines and are facing some of the world’s worst humanitarian crises to adapt tough new austerity measures that will further exacerbate poverty and inequality.

New analysis by Oxfam find that 13 out of the 15 IMF loan programmes negotiated during the second year of the pandemic require new austerity measures such as taxes on food and fuel or spending cuts that could put vital public service at risk. The IMF is also encouraging six additional countries to adapt similar measures.

In 2020, the IMF deployed billions of emergency loans to help developing countries cope with Covid-19, often with few conditions or none at all. (Daily Independent)