Ngozi Okonjo-Iweala, former minister of finance, on
Thursday said the zero political will to save under
former President Goodluck Jonathan is responsible
for the challenges the country is facing.
Speaking on “inequality, growth and resilience,” at
George Washington University, the two-time
finance minister said the World Bank and the
International Monetary Fund (IMF) must seek means
to embed savings in national constitutions devoid of
political manipulations.
Okonjo-Iweala added that Nigeria was able to save
$22 billion under former President Olusegun
Obasanjo, which saved the country in 2008, when
there was global economic meltdown.
Speaking on the Chilean saving example, Okonjo-
Iweala said: “We tried it in Nigeria, we put in an oil
price based fiscal rule in 2004 and it worked very
well.
“We saved $22 billion 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 a 5 percent of GDP fiscal
stimulus to the economy and we never had to come
to the bank or the fund.
“This time around and this is the key now, you need
not only need 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 political
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,
mechanisms and it is doable and we need to
interrogate ourselves why we have not done it.”
She added that manufacturing was also critical to
growth in Nigeria and the rest of Africa, quoting
manufacturing as just 11 percent of GDP in Africa,
and nine percent 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,
agriculture.
“I think these are the kinds of questions that policy
makers 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.”
The Cable
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