Turning the Corner: A New Compact between Nigeria's People and State
KEY MACRO-FISCAL POLICY RECOMMENDATIONS FOR THE NEXT SIX
MONTHS TO FULLY TURN THE CORNER
Curbing inflation and
stabilizing FX market
Tighten monetary policy further
Communicate a plan to swiftly phase
out monetization of the fiscal deficit
• Communicate the plan to phase out
current CBN development finance
schemes
• Continue to build market confidence
around free FX pricing and evaluate
and implement policies to channel FX
supply into the NAFEM
Publish full information on net reserves
to build market confidence
Creating more fiscal space
Regularly publish information which
explains prices at the pump to ensure
the subsidy is not reinstated
Improve transparency of NNPC with
regards to profits and oil revenues to
be remitted to the Federation Account
Raise non-oil revenues:
Increase VAT rate while allowing for
input tax credit; remove exemptions for
petrol products
Improve tax administration
Adopt a data driven approach to tax
auditing
Introduce a simple turnover tax on
SMEs at state level instead of various
existing fees and levies
Addressing structural
barriers to growth
• Detail plans to improve power and
transport infrastructure, public service
delivery, security, and business
environment. These are decisive
factors to raise growth prospects.
• Reduce trade restrictions:
• Review the import bans list and align
the tariffs to the ECOWAS common
external tariff
Review tariffs to reduce costs of key
inputs for producers
Simplify and harmonize import and
export procedures
• Address bottlenecks such as port
logistics and congestion
NIGERIA
THE WORLD BANK
IBRD ⚫ IDA WORLD BANK GROUP
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