The Federal Government, through the Coordinating Minister for the Economy and the Minister of Finance, Mrs Ngozi Okonjo-Iweala has assured Nigerians, once again that the economy is very strong and reliable, contrary to the insinuations in some quarters.
In a statement issued by the minister, the government has stated that the Nigerian economy is strong while the economic performance is robust when viewed against a whole range of objective factors. According to the Federal Government, inflation is now down to single-digit at 9.0% in January 2013, compared with 12.6% in January 2012, while the exchange rate has been relatively stable.
The minister said the fiscal deficit, at just under 2% of GDP is on a downward trajectory and below the threshold of 3% of GDP: “Our national debt is at a sustainable level at about 19.4% of GDP. Overall, GDP growth for 2012 was 6.5%, and projected at 6.75% for 2013, compared with the projected global growth of 3.5%. The above facts have been independently noted and validated by international ratings agencies (such as Fitch, Standard & Poor’s and Moody’s) who have upgraded the country’s economic outlook, even as other countries are being downgraded. In addition, Nigeria ‘s bonds have recently been included in the Barclays and JP Morgan Emerging Market indices,” the minister stated.
Recognising the socio-economic challenges which Nigeria faces as a nation, Okonjo-Iweala, said “We know we still have a long way to go, but let us keep working to correct what is wrong and stop focusing on the denigration of what is being done right. In this regard, we need to create more jobs for our youth to curb unemployment. Poverty needs to decrease at a faster pace, as we do not want excessive inequality to be a feature of our economic growth. For example, the recent poverty statistics released by National Bureau of Statistics show a slight decline in poverty levels of about 2% between 2003 and 2010. This needs to be further accelerated. The cost of governance also needs to be reduced, and the government is taking steps in this direction.
“We have reduced the share of recurrent expenditures in the budget from 74% in 2011 to 71% in 2012, and to 68% in 2013. We aim to push for a 60% recurrent and 40% capital budget ratio in the medium term.” On the external reserves, she said “as noted earlier by the Federal Government, Nigeria ‘s reported level of external reserves is comprised of three parts: the CBN’s external reserves, the Excess Crude Account, and the Federal Government’s funds belonging to agencies such as the Nigerian National Petroleum Corporation for joint venture cash calls and so on. This is simply a matter of definition, and follows international best practices and reporting guidelines. It is thus unnecessary to continue to dwell further on this issue.”
