The Nigeria Labour Congress (NLC) has expressed strong disapproval of the International Monetary Fund (IMF) for its refusal to take responsibility for the Nigerian government’s recent decision to eliminate the fuel subsidy.
The NLC criticized this denial as cynical and indicative of a broader trend by the IMF and World Bank of enforcing stringent economic policies on developing countries.
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In a statement issued on Sunday, Joe Ajaaero, the National President of the NLC, condemned the IMF for framing its detrimental recommendations as strategies for growth.
He argued that these policies have contributed to rising socioeconomic difficulties and stagnation in Nigeria, as well as in other nations that have adhered to the IMF’s misguided guidance.
During a press conference at the IMF and World Bank Annual Meetings held in Washington, DC, Abebe Selassie, the IMF’s African Region Director, referred to the Nigerian government’s choice to abolish the fuel subsidy as a matter of domestic concern.
“The IMF’s recent statement shows evasion, claiming Nigeria’s subsidy removal was a ‘domestic decision,’ while ignoring its significant influence on policy-making in developing countries.
Despite this denial, the IMF often advocates for subsidy cuts as necessary for fiscal sustainability, making its disavowal seem hollow in a country that has frequently complied with such recommendations,” the statement said.
The NLC has expressed growing concern over the IMF’s denial, viewing it as indicative of the troubling policies that the IMF and World Bank have enforced on Nigeria.
“The IMF seems to be distancing itself from the future backlash of these policies, but Nigerians are not naive; we recognize the destructive effects of its harmful strategies on Nigeria and Africa,” the union stated.
It added, “It is disingenuous for the IMF to deny complicity, especially since we have warned the government about the consequences of adopting these policies.”
Meanwhile, NLC mentioned that the IMF and World Bank’s denial of the social costs of their policies raises further concerns.
Although the IMF recognises the “significant social costs,” it simply suggests that governments mitigate these hardships through expanded social protections—an approach that often leaves people dependent on ineffective handouts, like the RICE initiative, the union stated.
The NLC pointed out that in Nigeria, the removal of subsidies and the increase in prices have rendered essential goods unaffordable, while the government’s social safety nets remain insufficient.
The NLC argued that the disconnect between IMF recommendations and the actual situation in Nigeria reveals a significant oversight in the fund’s economic policies.
By distancing itself from Nigeria’s decision to remove subsidies, the IMF demonstrates inconsistency in its guidance, promoting austerity while shirking responsibility for the resulting hardships.
Moreover, the NLC emphasized that this situation undermines the IMF’s credibility and raises questions about the genuineness of its economic prescriptions.
This is especially evident as the IMF’s assertion of Nigeria’s autonomy over its policies contradicts its historical influence, which has often led to turmoil and suffering.
Additionally, the NLC highlighted the necessity for Nigeria and other developing nations to reclaim their economic sovereignty, resisting externally imposed policies that do not take into account local contexts and the needs of the population.
“The IMF’s denial of involvement in Nigeria’s subsidy removal seems insincere, given its history of recommending similar austerity measures. We hope our economic leaders recognize that when crises occur, the IMF and World Bank will distance themselves, leaving the government to bear the burden,” it stated.
It further stated that Nigeria needs to adopt policies that truly address the needs of its citizens by focusing on economic strategies that foster growth, social welfare, and equity, rather than implementing austerity measures that lead to greater economic challenges and social unrest.
“We urge the World Bank and IMF to stop stifling our nation so we can breathe freely. They have become a significant challenge for us, and we may soon be compelled to demand their complete withdrawal from Nigeria, as their policies consistently undermine our economy and sabotage both the people and the nation,” NLC stated.
The NLC urged the IMF to avoid appearing cowardly and instead to take responsibility for its actions. This, they argued, is essential for demonstrating honesty and transparency, which are fundamental to the IMF’s claimed institutional integrity.
