23 August 2018, Sweetcrude, Port Harcourt — The Federal Government of Nigeria has been urged to make constitutional provision that will guarantee automatic savings of surplus from oil revenue in the Excess Crude Account, ECA.
The group Shehu Musa Yar’adua Foundation and the Nigeria Natural Resource Charter, made the call as their resolution during a roundtable discussion on savings and stabilization mechanism for Nigeria, held in Port Harcourt, the Rivers State capital.
Director of Public Policy Initiatives of the foundation, Mr. Amara Nwankpa, explained that Nigeria requires improved legal policy and advocacy frameworks for the excess crude account and other stabilization funds to be more effective and beneficial to citizens.
Nwankpa said Nigeria earned over one trillion dollars revenue through five cycles of oil booms, but made no significant savings, nor have the earnings translated to a lasting and productive capital through human development, physical infrastructure and institution building.
He regretted that Nigeria is a dysfunctional economy suffering from Dutch disease, as non-oil sectors contribute over 90percent to GDP yet generates less than 10percent to government revenues.
According to him, “The huge revenue from oil has not translated to real improvement in the welfare of citizens. According to the National Bureau of Statistics, 60percent of Nigerians still live below the poverty line.
“Corruption, mismanagement of oil revenues and lack of diversification in the export sector all have an important role to play in our slow economic growth and high poverty levels.
“Hence, the Federal Government must enact a constitutional amendment of section 162 of the 1999 Constitution with provisions that guarantee automatic savings of surplus revenues from oil, gas minerals with the Nigerian Sovereign Investment Authority, NSIA.
“The government must mandate transparency and accountability with disclosure and reporting requirements on deposits and withdrawals from the excess crude account.
Diversify the economy through investment in the non-oil sector and increase contributions of the oil industry to GDP.”
Also speaking, one of the facilitators at the event, Mr. Andrew Onyenakwe, explained. the need to amend the constitution to enable saving, adding that not every revenue of the government should be shared by a FAAC.
“There is a provision in the constitution for sharing of allocation between the three tiers of government. If the section is not amended, there will not be any provision for savings.
“The importance of the amendment is for the government to begin to save, not every revenue collected by the government should be shared.”