IMF Warns Nigeria: Spend Wisely After Tough Economic Reforms

|By Babatunji Wusu-

-IMF Cautions Nigeria on Spending Despite Economic Reforms
–Says Fiscal Prudence Key to Growth, Stability, and Investor Confidence

The International Monetary Fund (IMF) has advised Nigeria to exercise fiscal discipline despite achieving improved revenue through tough economic reforms.

The caution came from Vitor Gaspar, Director of the IMF’s Fiscal Affairs Department, at a Fiscal Monitor news conference during the ongoing 2025 IMF/World Bank Spring Meetings in Washington, D.C., on Wednesday.

Gaspar urged fiscal authorities across the world, including Nigeria, to build economic buffers and act urgently in the face of global uncertainties and tough trade-offs.

“Governments must put their house in order. This involves three key policy priorities,” Gaspar said.
“First, fiscal policy must align with overall economic policies. Second, countries should aim to reduce public debt and rebuild fiscal buffers to respond to shocks. Third, they must pursue structural policies that boost long-term growth.”

He stressed that fiscal policy should be a pillar of stability and trust, adding that Ministers of Finance must “build trust, tax fairly, spend wisely, and think long-term.”

Gaspar emphasized the need for countries to invest political capital in rebuilding confidence, especially in today’s fragile global financial landscape.

On Nigeria’s part, Davide Furceri, Nigerian Division Chief in the IMF’s Fiscal Affairs Department, noted that the country had made difficult but necessary reforms to create room for fiscal savings.

“Nigeria managed to do a very difficult reform that was important in delivering fiscal savings,” Furceri said.

He however warned that beyond saving, Nigeria must now spend wisely, particularly in social protection and capital investment. He also called for stronger efforts in revenue mobilisation to strengthen the country’s fiscal foundation.