Nigeria to focus on tighter spending, jobs

ABUJA: Nigeria's current administration will focus economic planning on reducing public spending, boosting job creation and improving power supply, Coordinator of the Economy and Finance Minister Ngozi Okonjo-Iweala said on Wednesday.

Former World Bank managing director Okonjo-Iweala said Nigeria should try and reduce recurrent expenditure by at least 1 percent a year in the remainder of the administration, which would bring it down to 70 percent by 2014.

She also said she was committed to keeping sub-Saharan Africa's second-largest economy within a 3 percent fiscal deficit target.

"We need to work harder. We need to maintain macro-economic stability. We need to manage our fiscal system in a more prudent manner. We can start with recurrent expenditure," she told reporters in the capital Abuja.

Okonjo-Iweala, who was sworn into her new role last week, also said Nigeria's cumbersome budget process had to be changed.

Government offices often spend months without knowing how much money they have for the year. Political wrangling meant President Goodluck Jonathan only signed the 2011 budget into law at the end of May.

"We need to change the budget process in this country. We can't bring a budget and then have reservations that go back and forth. The executive has its responsibility and I hope the lawmakers will also take responsibility. By 2013 we will have a much saner budget process".

Nigeria's reliance on oil exports meant fiscal prudence was even more important given the volatility of prices in recent months during the crisis in North Africa, the minister said.

She said there was broad agreement on ending fuel subsidies in Nigeria but no time frame has been set for this yet.

Despite being the world's fifth-largest oil exporter last year, Nigeria has to import most of its fuel needs due to dilapidated infrastructure and a lack of investment.

Most Nigerians live on $2 a day and ending fuel subsidies is a contentious issue as many believe it is the only benefit they receive from living in an oil-rich country.

"There has been a lot of debate on fuel subsidies and we have all resolved that (removing it) is a good direction to go on. You have to leave it to us to decide when it is prudent to do so," she told reporters.

Copyright Reuters, 2011