In an telephone interview with Reuters yesterday, Nigerian Finance Minister Ngozi Okonjo-Iweala, talked about Nigeria’s steady growth rate, her worries about the upcoming elections and more; read the highlights after the click.
Irrespective of is social development, it looks like economically, Nigeria’s economy is on track to expand with growth predictions for 2014 – 6.75% – slightly better than last year’s 6.5%. And that’s set to happen even though oil production has been stunted by 400,000 barrels a day on account of oil theft. Say what you want about Auntie Ngozi, you have to hand it to the woman – seems like she’s got Nigeria’s economy under control.
Highlights from the Reuters interview:
On the upcoming elections
Africa’s second biggest economy is drawing increasing foreign investment, both directly and through its equity and debt markets, but investors are wary of the violence and rampant spending on patronage that often occurs during election cycles.
“Of course I’m worried about elections … but we’ve put in place a tight fiscal framework,” Finance Minister Ngozi Okonjo-Iweala noted.
“Our country needs … macroeconomic stability.”
On the held up budget
The budget presented in December is being held up by the lower house, after defections cost the ruling party its majority there last month. The opposition All Progressives Congress (APC) has ordered its members to block the budget over an unrelated spat in the volatile, oil producing Rivers state.
“The house is playing Tea Party politics,” Okonjo-Iweala said, referring to the Republican movement that tried but failed to stop a budget deal in the United States.
“It’s even worse than the Tea Party because it’s not based on principle – it’s just a quarrel going on in one state.”
On the possibility of a government shutdown
Nigeria can use half of last year’s budget again and after that the government goes into shutdown. “But I’m not concerned at all,” she said, adding that the Senate has indicated it will pass the budget, and that agreement had always been reached in the past with both houses.
The 4.64 trillion naira ($28.41 billion) budget was tighter than the previous one, and the cuts were made largely by axing badly needed capital spending. That angered some lawmakers who want more money for projects ahead of 2015.
“They are angry they can’t spend the way they want, but we must fight to maintain … stability,” Okonjo-Iweala, twice finance minister and a former World Bank vice-president, said.
On the Excess Crude Account (ECA) dropping from $8.65 billion in December 2012 to just $2.28 billion in December 2013
She denied the ECA had been spent on electoral patronage, saying it was needed to cover the budget because oil theft had cut output from the 2.5 million to 2.1 million barrels a day.
“We suffered a huge quantity shock. If you’ve lost more than 20 percent of your output, how do you manage that?” she said. “That’s what the ECA was designed for: shocks.”
You can read the interview in its entirety, here.
