By Adedayo Akinwale and Mercy Apollos
The federal government has been advised to collapse the Excess Crude Account (ECA) into the stabilisation account of the Sovereign Wealth Fund (SWF).
Some experts gave the advice in a roundtable meeting on ‘Savings and Stabilisation Mechanism for Nigeria,’ organised by the Shehu Musa Yar’dua Foundation.
In a communiqué read at the end of the meeting by Mr. Jide Ojo, the participants said the economic reforms established by the Olusegun Obasanjo administration (2003-2007) represented the first attempt to break the pattern through the innovation of a saving mechanism known as the ECA.
They observed that attempt had been made to institutionalised the ECA in the Fiscal Responsibility Act of 2007 but State governors claimed it contradicts the 1999 constitution.
The experts said, “Despite oil revenue earnings, 60 per cent of the population still lives below poverty line. Corruption, mismanagement of oil reserves and lack of diversification in the export sector have slowed economic growth and contributed to high poverty levels.
“Multiple ‘curses’ associated with natural resource endowed economies are all manifest in Nigeria. Despite the substantial revenues that have accrued to state and local governments, states are still burdened by debts.”
They said that there was need to increase transparency regarding revenue inflow and outflow from the federation account, while adding that the disbursement of funds from the stabilisation accounts is absolutely discouraged.
“Collapse the Excess Crude Account and 0.5 per cent stabilisation account into the stabilisation account other Sovereign Wealth Fund,” they said.