President of the World Bank Group, Mr David Malpass, has commended the Federal Government for removing subsidies on petroleum products.
Malpass said this in Washington D. C. on Wednesday at the opening press conference for the World Bank at the ongoing 2020 International Monetary Fund, IMF/World Bank virtual annual meetings.
Malpass was responding to a question on whether the World Bank saw an opportunity or problem regarding the enormous youth population in Nigeria accompanied with rising unemployment and the burden of COVID-19.
“I compliment Nigeria for tackling the problem of subsidies in the hydrocarbon area.
“By reducing those subsidies and allowing gasoline prices to rise – it is very hard for governments to do that – there are substantial benefits.
“It means that there are fiscal savings, it also means that there are environmental benefits that are large and it allows markets to work better and to allocate resources better.
“So, I think progress is being made in that area and it is valuable,” he added.
On tackling the economic crisis the pandemic posed for Nigeria, he said that the vital steps were to strengthen the health and the education system.
According to him, the governance system and transparency were vital in order to reduce the corruption within the system.
He said that there were opportunities as well.
“I think each country has to confront or has to think about where it wants to be in a post-COVID world that is going to be very different from the pre-COVID world.
“That means a different way of people interacting, hopefully better; a greener way of operating; and an emphasis on health care.
“We have extended the emergency health response to include vaccines and distribution of vaccines for COVID, but it also has the benefit of helping the vaccination programes in other areas and the healthcare outreach in other areas that will be so valuable.”
He, however, said that the first priority was to save lives, people’s health and safety.
He said that would involve procedures like social distancing and masks and proper health care if people contract the virus as well as strengthening of hospital systems.
Malpass said that looking at the next stage, it would be a prolonged downturn for many countries, as there would not be as fast a rebound in tourism, for example, as many would like to have.
He said that there would need to be flexibility in economies, so that people could move to new jobs and positions and the country could be prepared for a post COVID global economy.
“We know it is going to be different from the pre-COVID economy. We do not know exactly how and that will only evolve over time.
“So, having countries preserve some of their core industries and businesses, and then keeping families together.
“We are providing social safety nets to try to help provide cash grants for people,” he said.
In addition to the steps to strengthen the process and create a resilient recovery was climate and lower carbon rebuilding efforts, which, he said, was very important.
Also, on what could be done in the recovery period to strengthen and improve global trade as it related to global Gross Domestic Product (GDP), he said a very beneficial step was trade facilitation.
According to the president, that means trying to keep markets open across borders and where markets are closed and lowering the barriers that occur.
“So, for example, between Benin and Nigeria, there are high tariff barriers on rice, which is distortive and expensive, so finding steps that can be done to facilitate cross border trade and to allow commerce to take place.”
That, according to him, means a safe environment, one that is available to all people, that is not discriminatory in terms of the way it operates.
“I think looking more broadly, it is the commitment by countries around the world, a recognition that commerce is critical to people’s rising living standards.
“We strongly support moves worldwide to allow more trade and to reduce the barriers to trade,” Malpass said.
The 2020 Annual Meetings of the IMF and the World Bank Group holding in Washington D. C. began on Oct. 12 and will end on 16 December.