Tokyo - Coordinating Minister for the Economy, Ngozi Okonjo-Iweala, said in Tokyo on Sunday that Nigeria’s Excess Crude Account would be built up to 10 billion dollars by early 2013.
Okonjo-iweala made this known while briefing newsmen on the Nigerian economy at the Annual Meeting of the World Bank and the IMF.
``I strongly feel and I have shared with the governors, with Mr. President and vice-president who fully supports that the Excess Crude Account must be built up to 10 billion dollars.
``We should strive to do that in the next few months and we keep that as buffer.’’
According to her, if the account is built up to 10 billion dollars and it is not touched form a while, it will serve as buffer.
She noted that there was the need to increase the nation’s external reserve, considering the population of the country.
``our reserves are not huge, we are just building backup; it’s not my place, it is the monetary policy that manages it, but I have discussed with the CBN governor that we need to build up our reserve to 50 billion dollars, if we can.
``That will be the desires of the fiscal authorities, so I don’t consider us with the size of the economy and population we have.
``Look at Algeria, their reserve is nearly 200 billion dollars, for a country much smaller than Nigeria,’’ she said.
On infrastructure, she noted that the country needed about 10 billion dollars yearly to tackle its infrastructural challenges adding that Nigeria would draw from the World Bank’s loan offer with a go-ahead from the National Assembly.
She noted that Nigeria would not draw from the international monetary resources at the moment to tackle the infrastructure challenges.
``We are trying to put our borrowing to really direct it to infrastructure, as you know we have gone to other sources, the Word Bank is helping us with power, so is the African Development Bank.
``Those are very concessional resources. The problem we have right now is that the meetings from the World Bank; they are indicating that if we do not pass through external borrowing plan, where we have 1.2 billion dollars, that has been approved.
``They are very sympathetic to us, they will like Nigeria to use that money but if the money stays there and it’s not approved for use, they will have to move it and give it to other countries.’’
Okonjo-Iweala noted that the loan to be taken would be given at zero interest rate, a 40-year repayment period and 10 years of moratorium and only 0.7 per cent commitment charge.
She said that the money would be used for power, water and health care among others, adding that Nigeria could only benefit from the loan, if the National Assembly approved.