The International Monetary Fund (IMF), yesterday in Washington DC, United States, declared that Nigeria’s Excess Crude Account (ECA) was not achieving the goals for which it was set up.
Speaking during a media briefing on “Regional Economic Outlook: sub-Saharan Africa”, IMF’s Director of the African Department (AFR), Abebe Selassie, said: “The concern that we have is about the ECA, because if you recall that the ECA economically was set up to save resources when oil prices are high, and to be drawn on when oil prices are low. We do not think that the ECA has been doing effectively enough jobs that way.
“Because you see, when oil prices fell, the economy was very hard in the last couple of years, we feel like much better job could have been done, saving enough more in the ECA when oil prices were at $100 and $120 per barrel.”
The poor performance of the ECA, the IMF chief said, largely influenced IMF’s decision to rank Nigeria second worst in the world in the use of Sovereign Wealth Funds.
The Bretton Wood Institution rating was based on the corporate governance and transparency scores of the sovereign wealth funds and the size of assets as a percentage of 2016 GDP of the countries considered.
Selassie, who was speaking on the reactions trailing the negative ranking, said: “I want to be precise on this issue because I have heard a lot of noise concerning it. There have been two Sovereign Wealth Funds in Nigeria. There have been the Excess Crude Account (ECA), and the Nigeria Sovereign Investment Authority (NSIA). The NSIA is running transparently, on standard best practice and it has been doing a good job.”
Source: This Day