Nigeria’s oil savings can’t fund 20% of 2017 budget —NEITI

NIGERIA Extractive Industry Transparency Initiative (NEITI) says all of the country’s oil savings since the inception of its savings history cannot fund 20 per cent of 2017 budget.

NEITI, therefore, called on the Federal Government to save some portions of oil and gas revenue for the rainy day as well as for the next generation.

In its second occassional paper series unveiled by Waziri Adio, executive secretary, NEITI said “Nigeria has about three decades of experience in implementing different oil revenue funds. However, attempts at oil revenue savings have been plagued by contested legal frameworks, governance issues and inadequate political will.

“Nigeria has one of lowest natural resource revenue savings in the world. The balance in the three funds (0.5 per cent stabilisation fund, ECA and NSIA) is less than $3.9 billion, not enough to fund 20 per cent of 2017’s federal budget.

“Nigeria’s $1.5 billion sovereign wealth fund is one of the lowest in the world, has one of the worst ratio to annual budget (10 per cent) and one of the lowest SWF per capital ($8), better only than war-torn Iraq and crisis-hit Venezuela, but not by much.

“In contrast, Norway, a country of 5.2 million people (2.8 per cent of Nigeria’s 186 million people) has a sovereign wealth fund worth $922 billion (which is 23,641 per cent of the $3.9 billion balance in Nigeria’s three oil revenue funds).”

In simpler terms, if Nigeria’s oil savings were shared across the country, each citizen would have access to only $8 after over 60 years of oil exploration.

For countries like Norway, Kuwait and Botswana it is at $185,000, $148,000 and $14,400, respectively.