No Will To Save Under Jonathan – ex-Minister

Former Minister of Finance, and World Bank’s Chief, Dr. Ngozi Okonjo-Iweala, said lack of political will to save oil revenue under former President Goodluck Jonathan was responsible for challenges that the nation was confronted with now.

She said, as a result, the World Bank and the International Monetary Fund must seek means to embed savings in national constitutions devoid of political manipulations.

Okonjo-Iweala spoke on the topic: ‘Inequality, growth and resilience’ at George Washington University, United States of America.

The two-time minister recalled that Nigeria was able to save $22bn under former President Olusegun Obasanjo, which she noted saved the country in 2008 during the global economic meltdown.

Citing the Chilean example, she said, “We tried it in Nigeria, we put in an oil price-based fiscal rule in 2004 and it worked very well.

“We saved $22bn because the political will to do it was there. And when the 2008/2009 crisis came, we were able to draw on those savings precisely to issue about five per cent of the Gross Domestic Product as fiscal stimulus to the economy, and we never had to come to the bank or the fund.”

She added, “This time round, and this is the key now, you need not only to have the instrument but you also need the political will. In my second time as a finance minister, from 2011 to 2015, we had the instrument, we had the means, we had done it before, but zero political will.

“So, we were not able to save when we should have. That is why you find that Nigeria is now in the situation it is in, along with so many other countries.”

On solving the problem of political will and manipulations, she said, “That is the question that I ask; what do we need to do to these countries to save over a period of long accelerated growth?

“We need to devise mechanisms not just that are good technically, but find a way to either embed them in the constitution or find a way to separate them from the political manipulation so that these countries can survive over time.

“To build resilience, African countries need tools and mechanisms, and it is doable and we need to interrogate ourselves why we have not done it.”

Okonjo-Iweala added that manufacturing was critical to growth in Nigeria and the rest of Africa, quoting manufacturing at just 11 per cent of the continent’s Gross Domestic Product, and nine per cent in Nigeria.

“I do not believe that we can be resilient, except if we can encourage manufacturing, even on the goods we consume, services, entertainment industry and agriculture.

“I think these are the kind of questions that policymakers struggle with on a daily basis, and that is what we are going to answer to get resilience.

“If we don’t get these mechanisms, we politicise them, find ways to transform the base of the economy and create jobs, including in manufacturing, I believe we are going to go into this looming deceleration that is being talked about”, she said.