Despite earning over $1trn in 50 years, Nigeria still backward -Experts

Despite earning over $1trn in 50 years, Nigeria still backward -Experts


Experts in the oil and gas sector have again lamented the continued backwardness of the country in spite of earning over $1 trillion from crude oil sales since the 1970s.

They said only about $2 billion was left in the ECA as at December 2017.

At a Roundtable on Savings and Stabilization Mechanisms for Nigeria organized by the Shehu Musa Yar’Adua Foundation Monday in Abuja, they opined that Nigeria requires improved legal, policy and advocacy frameworks for the Excess Crude Account, ECA and other Stabilization Funds to be more effective and beneficial to citizens.

Key participants at the event included Dr. Obiageli Ezekwesili, Former Vice President (Africa Region) of the World Bank and Director, Africa Economic Development Policy Initiative (AEDPI); Bode Longe, an Economist, Dr Usman Bugaje, a former federal lawmaker as well as representatives from the Civil Society, Political Parties and the Media.

In a communique issued at the end of the event, participants “lamented that despite an estimated trillion plus dollars in oil revenue, Nigeria has no significant savings nor have we translated these earnings to productive

capital through human development, physical infrastructure and institution building”.

While they noted that the ECA has had no significant increase despite rallying oil price between July 2017 and January 2018, appropriations from the Excess Crude Account which had previously gone through the Federal Accounts Allocation Committee FAAC are now documented elsewhere.

“In the past three years, however, this does not seem to be the case. Withdrawals from the ECA are not disclosed to the FAAC even when properly documented elsewhere. It was observed that the ECA lacks transparency and has an unclear methodology for withdrawals and distributions manifested in unilateral withdrawals by successive governments”.

The communique also lamented that Nigeria’s Excess Crude Account has been ranked the most poorly governed sovereign wealth fund among 33 resource-rich countries, according to a 2017 report by the Natural Resource Governance Institute. “Nigeria was placed in last position along with the Qatari Investment Authority as a country whose government discloses almost none of the rules or practices governing deposits, withdrawals or investment of the ECA”.

Consequently, the roundtable urged the federal government to ” urgently effect a constitutional amendment of Section 162 of the 1999 Constitution with provisions that guarantee automatic savings of surplus revenues from oil, gas and minerals with the Nigeria Sovereign Investment Authority NSIA”.

Other recommendations were for the government to, in the interim, “Politically negotiate and agree binding rules for ECA revenue inflows and outflows until such a time as the constitutional amendment is effected to entrench the Excess Crude Account.

“Mandate transparency and accountability with disclosure and reporting requirements on deposits and withdrawals from the Excess Crude Account— ECA. The Federal and State Governments should seek speedy resolution of pending Supreme Court cases on the constitutionality of remittances to the Excess Crude Account and the Nigeria Sovereign Investment Authority;

“Collapse the Excess Crude Account and 0.5% Stabilization account into the Sovereign Wealth Fund. Strengthen NSIA with appropriate guarantees on transparent and accountable governance to re-assure stakeholders; as well as revise and fully implement the Niger Delta Masterplan”.

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