Russia-Ukraine: Higher food, fuel prices loom in Nigeria, others, says IMF

The International Monetary Fund (IMF) has said Nigeria and other African countries are vulnerable to higher food and fuel prices, low tourism revenues, and difficulty accessing the international capital market as a result of the war going on in Ukraine.

The Managing Director, IMF, Ms Kristalina Georgieva, disclosed this after meeting with African Ministers of Finance, African central bank governors, and representatives from the United Nations Economic Commission for Africa to discuss the impact of the crisis in Ukraine.

In a statement on the IMF’s website, she said, “The war in Ukraine is devastating the lives of millions of people and severely affecting the Ukrainian economy.

“The war and the unprecedented sanctions imposed on Russia are having far-reaching consequences. They come at a delicate time for Africa. Just as the global economy and the continent are beginning to recover from the ravages of the COVID-19 pandemic, this new crisis threatens to undo some of that progress.

“We discussed how to sustain Africa’s recovery—already lagging other regions— despite significant new obstacles. Africa is particularly vulnerable to impacts from the Ukraine war through four main channels—increased food prices, higher fuel prices, lower tourism revenues, and potentially more difficulty accessing international capital markets.”

She stressed that there were significant concerns about the limited domestic policy space to sustainably address the ongoing crises. She added that redoubling efforts to advance reforms that promote resilience is a priority for many countries.

She said the Fund is ready to help any African countries address the repercussions of the war in terms of designing and implementing reforms through its policy advice, capacity development, and lending.

Georgieva said: “Recent reforms to the Fund’s lending toolkit provide greater flexibility to help meet financing needs.

“I was also pleased by the ongoing strong interest from African countries in the proposed Resilience and Sustainability Trust, which we plan to have fully operational by the end of this year.”