In spite of declining oil price in the international market, the Minister of Finance, Ngozi Okonjo–Iweala, said on Tuesday the Nigerian economy remained strong, with positive growth indices.
Mrs. Okonjo-Iweala, who spoke at the 2014 Ministerial Platform in Abuja, said the nation was not broke as being speculated in some quarters.
“If you look back two years ago, `is Nigeria broke?‘ was a major newspaper headline. It is like people are trying to force Nigeria into brokerage. I think since two years, we have managed to keep things going,” she said
According to the minister, government was doing everything within its powers to ensure economic stability in the country, adding that at the moment it had been budgeting below the existing oil price benchmark to help build buffers in case of any uncertainty.
She said the country was operating an economy that depends on a product that fluctuates with oil price, with government having any control.
When the price of oil dropped from $140 to $38 per barrel between 2007 and 2008, nobody asked if the country was broke, because the country had saved up $22 billion in the Excess Crude Account and was able to continue spending and stabilising the economy.
The minister said the impact of the current price fluctuation on Nigeria was on quantity of oil, which was affecting the amount of revenue paid into government coffers.
The decline in revenue, she said, was not an indication that the country was broke, pointing out that the country still had resources to depend on for its development programmes.
Mrs. Okonjo-Iweala said the only time the country would be considered broke would be if government was unable to pay salaries to workers and manage the economy, assuring that the country had not gotten there yet.
On the management of the country’s fiscal deficit, she said that the Ministry of Finance would continue to ensure that it was kept as narrow as possible, pointing out that in 2013, the debt to Gross Domestic Product (GDP) ratio was 1.4 per cent and 1.03 per cent in 2014, with a projection of one per cent in 2015 budget.
She added that borrowing had been on the decline and external debt stood at N1.46 trillion or 14 per cent of the total debt as a result of the adoption of the policy of prudence in debt management, which allowed Nigeria’s debt to GDP to be one of the lowest in the world.