The International Monetary Fund (IMF) has thrown its weight behind the planned increase in Value Added Tax (VAT) by the Federal Government.

The Organisation also encouraged the country look into increasing other forms of taxes, from non oil revenues, as a means of raising more funds.

This was disclosed on Wednesday in a press release after the conclusion of the IMF Executive Board 19 Article IV Consultation with Nigeria.

The Executive Directors said with 2.5 percent in the medium term, and with population growing at a faster rate, growth per capital will be less than zero percent.

The statement read in part, ‘’They welcomed the authorities’ tax reform plan to increase non-oil revenue, including through tax policy and administration measures.

‘’They stressed the importance of strengthening domestic revenue mobilization, including through additional excises, a comprehensive VAT reform, and elimination of tax incentives. Securing oil revenues through reforms of state owned enterprises and measures to improve the governance of the oil sector will also be crucial.’’

It also called on the Central Bank of Nigeria (CBN) to stop its direct intervention in the foreign exchange market.

“They stressed the importance of strengthening domestic revenue mobilization, including through additional excises, a comprehensive VAT reform, and elimination of tax incentives.

“Directors highlighted the importance of shifting the expenditure mix toward priority areas. They welcomed, in this context, the significant increase in public investment but underlined the need for greater investment efficiency.

“They also recommended increasing funding for health and education. They noted that phasing out implicit fuel subsidies while strengthening social safety nets to mitigate the impact on the most vulnerable would help reduce the poverty gap and free up additional fiscal space.”

The Directors also emphasized the need to strengthen governance, transparency, and anti-corruption initiatives, including by enhancing AML/CFT and improving accountability in the public sector.

‘’Directors also recommended establishing a credible time bound recapitalization plan for weak banks and a timeline for phasing out the state backed asset management company AMCON,’’ part of the release stated.

The Central Bank of Nigeria, CBN, is set to device a new means of liquidity management in order to reduce associated expenses.

The Deputy Governor in charge of Corporate Services at the CBN, Mr. Edward Adamu, stated this on Wednesday when he presented the 2019 budget proposal of the apex bank on behalf of the bank’s Governor, Godwin Emefiele to the House of Representatives Committee on Banking and Currency.

Adamu, who gave a summary of all the vote heads and commitments of the bank for 2019, explained that the bank remained committed to sustaining stability in the financial system, in addition to pushing policies that would continue to engender growth in the Nigerian economy.

The Chairman of the committee, Jones Onyereri, acknowledged the efforts of the CBN at managing liquidity, urging the apex bank to do more by further enlightening members on the dynamics of liquidity management.

Figures made available by the Central Bank of Nigeria, CBN, have shown that the country’s foreign exchange reserve has hit a six months high at $44.14 billion as at Thursday.

The external reserves have gained over $1.8bn since February 28, when it dropped to its 2019 low of $42.296bn.

The reserves had risen slightly from $43.116bn on December 31, 2018, to $43.174bn on January 31, 2019, only to fall to $42.296bn at the end of last month.

It would be recalled that the external reserves rose to a high of $47.865bn on May 10, 2018. It however plunged to $41.523bn on November 22 from $44.305bn on September 28.

This is coming just as the United States’ President, Donald Trump’s tweet cussed another price upset in the crude oil market.

Trump had on Thursday, called for the Organisation of the Petroleum Exporting Countries to boost oil production to lower the price of the commodity.

“[it is] very important that OPEC increase the flow of oil. World markets are fragile; price of oil getting too high. Thank you!” Trump wrote in a post on Twitter.

Immediately after the tweet, the US crude oil futures fell by more than $1 to $58.33 a barrel and Brent futures were down by more than $1 to a session low of $66.76 per barrel, News reported.

The Central Bank of Nigeria, CBN, has estimated that the country’s inflationary rate will rise to 12 percent and thereafter moderate.

The Governor of the CBN, Godwin Emefiele stated this on Thursday in Lagos at the Businessday post election economic agenda conference, adding that the apex bank would also keep the current monetary policy stance of the bank.

“The CBN has set the post-election agenda for the nation’s monetary policy, projecting that the current monetary policy stance of the bank is expected to continue while inflation is estimated to rise to 12 per cent and moderate thereafter,” he said.

The inflation rate is currently put at 11.31 percent for February, according to statistics from the CBN and the National Bureau of Statistics.

Hinging the monetary policy stance of the bank on rising inflation expectations, the CBN governor however noted that the bank would adjust the policy rate in line with unfolding conditions and outlooks, adding that the bank would continue in its drive to ensure that the policy interest rate was set to balance the objectives of price stability with output stabilisation.

Emefiele, who disclosed that the apex bank based the inflationary projection on productivity gains in the agricultural and manufacturing sectors, said the Gross Domestic Product, GDP, was expected to pick up in the first half of the current year owing largely to the continued efforts at driving indigenous production in high-impact real sector activities.

Speaking on the bank’s foreign exchange rate policy, Emefiele said the CBN, in spite of expected pressures from the volatility in the crude oil markets, would maintain its stable exchange rate over the next year.

“Gross stability is projected in the foreign exchange market, given increased oil production and contained import bill,” he said.