Market News

By Lawrence Agbo

The International Monetary Fund (IMF) has announced plans to provide up to $50 billion in financial support to Nigeria and other countries hit by the impact of the ongoing Middle East crisis.

IMF Managing Director Kristalina Georgieva disclosed this during the unveiling of the Fund’s Global Policy Agenda at the IMF-World Bank Spring Meetings in Washington DC.

“We have been closely watching the events in the Middle East. This is an asymmetric shock, with the biggest burden falling on countries that import energy and have limited policy space,” Georgieva said. “In many cases, these are low-income or fragile economies, and they need attention.”

She said the IMF anticipates near-term demand for financial support to range from $20-50 billion. That represents prospective demand for new programmes from at least a dozen countries, most of them in Sub-Saharan Africa.

Georgieva described the IMF as a “firefighter for our member countries” and urged early engagement to enhance the effectiveness of intervention efforts. She noted that the Fund is working with global partners to coordinate a comprehensive response for vulnerable economies.

On policy, she cautioned against hasty fiscal and monetary moves. For countries where policy was well calibrated before the shock and expectations remain anchored, “wait and see” is the right approach, she said. In others, early action may be required.

Georgieva warned that global public debt is projected to exceed 100% of GDP by 2029, a level not seen since after World War II. She said policymakers must balance fiscal sustainability with protecting the most vulnerable.

She added that most Sub-Saharan African countries fall within the highly vulnerable category due to import dependence and weak fiscal buffers.

“I have in my office a map of countries showing their dependency on imports and fiscal space, and it is concerning that many African countries are in the quadrant of vulnerability,” she said.

Georgieva noted that African ministers and central bank governors are increasingly asking for policy advice and support to deepen local currency markets, not just money. But she stressed the Fund stands ready to provide rapid financial support where needed.

“My message is clear: if you need help financially, don’t hesitate. The sooner we act, the more we can protect economies and livelihoods.”

The IMF warned that rising energy, fertiliser and shipping costs could dampen growth, worsen poverty and heighten food insecurity across the continent.

Davide Furceri of the IMF added that while oil-exporting countries like Nigeria may see temporary windfalls from higher crude prices, the gains must be prudently managed.

“For oil exporters such as Nigeria, higher oil prices may generate temporary windfalls, but it is important to use these gains to rebuild fiscal buffers and reduce debt vulnerabilities,” he said.