IMF backs CBN’s ban on cryptocurrency operations

The International Monetary Fund has said that the clampdown on cryptocurrency operations by the Central Bank of Nigeria is in order.

The IMF said many countries of the world had also taken similar action, noting that the use of cryptocurrencies for illegal deals and money laundering had become a global concern.

The IMF Resident Representative for Nigeria, Ari Aisen, made this position known during a virtual press conference on the recently published 2020 Article IV IMF Staff Report for Nigeria.

The Fund’s reaction came on the heels of the controversy that had trailed the CBN’s action on cryptocurrencies.

On Debt to Gross Domestic Product ratio, Aisen said it was still within an acceptable range, but pointed out that it must not be allowed to reach a level that would make sustainability difficult.

According to him, borrowed funds should be properly managed in the interest of the country’s economy.

He said it was more important to monitor the ratio of debt service to revenue, adding that Nigeria’s revenue profile was very low and might not be able to meet budgetary expenditure provisions.

He however advised the country not to raise taxes yet, saying that the Federal Government should instead strengthen its tax administration by blocking leakages and expanding the tax base.

 

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