Despite fears that a spending spree of oil revenues may disrupt macroeconomic gains, the International Monetary Fund has maintained its forecast of nine per cent Gross Domestic Product growth rate for Nigeria, signaling economic prosperity for the oil-rich nation.
The Managing Director, IMF, Mr. Dominique Strauss-Khan, who departed Nigeria from Abuja on Thursday, said growth forecast on Nigeria’s economy was only second to China that had been projected at 10 per cent.
The IMF position on Nigeria has renewed confidence that the country will receive an improved rating from the global sovereign rating agency, Standard and Poor’s, that is currently appraising the country’s economic score card.
As an emerging market, Nigeria recorded a GDP growth rate of about six per cent in 2006, buoyed by high oil prices and a sound fiscal management policy.
On Wednesday, Strauss-Khan warned of the risk of high oil revenues spending and over-dependence on energy on the macroeconomic stability of the country.
He also said the subprime crisis that hit the United States might have negative effect on developing economies like Nigeria.
The Minster of State for Finance, Mr. Remi Babalola, while inaugurating the electronic dividend payment system, otherwise known as, e-dividend payment, in Abuja on Thursday, said the positive forecast by the IMF indicated that the economy was robust and was moving in the right direction.
“The IMF has actually given an outstanding support to the Nigerian economy,” he said.
The e-dividend payment system, which is a brainchild of the Securities and Exchange Commission, is aimed at promoting efficiency and tackling sharp practices in the capital market.
Babalola commended the SEC for the initiative, noting that the positive comments on Nigeria by the IMF placed a burden of more work to be done to sustain the tempo.
He said, “We cannot talk about the economy without the capital market. It is actually the barometer.”
He described the new dividend payment system as “taking corporate governance to another level.”
According to him, the government intends to step up the regulation and supervision of the market so that investments are secured.
As an emerging market, the minister said the country would not toy with the capital market as it stood as a veritable point for wealth creation and economic growth.
Babalola further said that the electronic payment of dividend to shareholders would eliminate complaints arising from unclaimed dividends.