Abuja - The Minister of Finance, Dr Ngozi Okonjo–Iweala, has assured Nigerians that the economy is growing positively in spite of the reduction of oil price in the international market.
Okonjo-Iweala, who stated this on Tuesday at the 2014 Ministerial Platform in Abuja, said the nation was not broke as being speculated in the media.
She said, “If you look back two years ago, that title ‘is Nigeria broke’ was written in a newspaper article, it is like people are trying to force Nigeria into brokerage.”
“I think since two years, we have managed to keep things going, let me explain these; Nigeria is a country that depends on a stream of income.”
“That income is being able to collect taxes from companies, individuals and our income is also based on selling a product and that product you take to market and you take whatever price a buyer is willing to pay.”
According to her, government is doing everything within its power to ensure economic stability in the country.
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She said that presently, government had been budgeting below the existing oil price to help build buffers in case of uncertainty.
“We are operating an economy that depends on a product that fluctuates with oil price and we don’t have the right to control the price.”
“Just like you have in your own household, when the quantity diminishes or the price drops, you remember in 2007 to 2008, the price of oil dropped from 140 dollars to 38 dollars.”
“At that time, nobody asked if the country was broke because we had saved up 22 billion dollars in the Excess Crude Account and we were able to continue spending and to stablise the economy.”
The minister said that presently Nigeria was faced with fluctuations in quantity and price of oil, adding that it had affected the amount paid into government coffers.
“Does that mean that the country is broke? We still have resources that we depend on; we still have the ability to tax.”
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“Sometimes, things need to be a little tighter, easier and we just have to weather it and manage ourselves but that does not amount to the country being broke.”
The finance minister said if government was not able to pay salaries to people and continue to manage, “then we can say that the country is broke but we have not gotten there yet.”
She urged Nigerians to bear with the nature of the economy, adding that it was the reason every effort was challenged to ensure the economy was diversified.
Commenting on the management of the fiscal deficit, she said that the Ministry of Finance would continue to ensure that it was kept as narrow as possible.
She said that in 2013, the debt to Gross Domestic Product (GDP) ration was 1.4 per cent and 1.03 per cent in 2014 and projected to be 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.
The ministry had adopted prudence to debt management and Nigeria’s debt to GDP remained one of the lowest in the world.