INFLATION THREATENING NIGERIA AND OTHERS
According to the International Monetary Fund, inflation, debt, and a currency crisis are pushing the Nigerian and other African economies to the verge of collapse.
Kristalina Georgieva, Managing Director of the IMF, stated that African finance ministers and central bank governors informed her of this this week.
She went on to say that most African countries might seek funds from global financial markets since they lack big home markets.
"The exceptionally challenging situations in many African nations at this time are vital to remember," she said. Many of the African Finance Ministers and Central Bank Governors I met with this week stressed how the repercussions of this wholly external shock were driving their economies to the brink.
"The impact of increased food costs is being felt sharply since food accounts for a larger percentage of income." Inflation, fiscal, debt, and balance-of-payments pressures are all increasing. Most are now entirely cut off from global financial markets, and unlike other areas, they lack significant local markets to which they may turn.
"Against this backdrop, they are urging the international community to take significant actions to assist their people." This is a call to action."
Georgieva stated this in a paper titled 'Facing a Darkening Economic Outlook: How the G20 Can Respond,' which is available on the IMF's website. The study, which was issued on Wednesday, serves as a backdrop to the meeting of G20 ministers and central bank governors in Bali.
this coming week According to the MD of the Washington-based lender, the human and economic effect of the Ukrainian war has increased due to commodity price shocks and an increase in the cost of living, resulting in a crisis for hundreds of millions of people.
She stated that inflation is currently greater than predicted and has spread beyond food and energy costs, prompting major central banks to propose more monetary tightening.
She stated that the fund's global growth projections for 2022 and 2023 will be reduced in its World Economic Outlook update later this month.
"It's going to be a rough 2022—and potentially an even harsher 2023, with an increased probability of recession," Georgieva said.
"That is why, headed by the G20, we want urgent action and robust international collaboration." Our new G20 study offers measures that governments might adopt to navigate this troubled waters."
She emphasized that 2022 will be difficult, and that the likelihood of a more difficult 2023 is rapidly approaching.
