Division Chief of the Research Department, Jean Mac Natal, highlighted countries’ ongoing challenges in managing inflation and debt levels.
He said that whilst some nations are seeing inflation stabilise or decline towards target levels, many are still grappling with high inflation rates, including double-digit figures.
Addressing the media at the IMF Annual meetings, Mr. Natal emphasised the growing concerns of high debt and fiscal consolidation.
Though balancing debt management with essential relief efforts such as those needed in Nigeria, following recent flooding remains a difficult task for policymakers.
” There has been over the last, year and a half, some progress in the region. You saw inflation stabilizing in some countries going down even and reaching close level close to the target. But half of them are still at a large distance from the target, and a third of them are still having double-digit inflation. In terms of growth, it’s quite uneven, but it remains too low. The other issue is that in the region it is still high.
It has not increased. It has stopped increasing. And in some countries, already starting to consolidate. But it’s still too high. And the debt service is correspondingly still high in the region,” Mr. Natal said.
” So the challenge is still there. There’s been some progress. So in terms of the recommendation in countries where inflation is very high, we would recommend tight monetary policy and in some cases, when possible, helped by consolidation on on the fiscal side.
It’s complicated. It’s in many countries, there are trade-offs and consolidating fiscal is difficult when you also have to provide relief, like in Nigeria, for example, due to the flooding.
So targeting, the support to the poor and the vulnerable is is part of the package when you consolidate,” He continued.
