Nigeria, Oct. 17 -- The IMF noticed in its most recent Regional Economic Outlook for Sub-Saharan Africa that Nigeria and other regional nations have more and more turned to local banks for financing fiscal deficits, exposing their financial systems to sovereign debt. Though this approach has given near-term relief, the Fund warned it has also driven up interest rates, damaged bank balance sheets, and slowed private sector credit expansion.



According to the IMF's African Department Director, Abebe Aemro Selassie, Nigeria's interest payments currently make up over 30 percent of government income-among the highest in Africa-thereby restricting governmental spending flexibility. He also cautioned that the price of new local borrowing has ...