Dwindling oil prices: World Bank supports Nigeria on diversification of economy

As the fall in global oil prices bites harder on Nigeria’s economy, Rachid Benmassoud, World Bank country director in Nigeria, has assured Nigerians that the global financial institution was perfecting strategies to support government at all levels to diversify the economy.

Benmassoud said this in Abuja on Thursday, while briefing members of the Senate Committee on Local and Foreign Debts on state of the nation’s financial cooperation with the financial institution.

The World Bank chief promised to communicate the debt profile of Nigeria to the Committee at a later date, but noted that the country’s indebtedness, compared with the nation’s Gross Domestic Product, was very small compared with those of other African countries.

He pledged that the global institution was ready to partner Nigeria in the areas of agriculture and mining in order to generate alternative sources that would not only be needed to service its foreign loans but also fund public infrastructure.

He also said the World Bank would support the country in the areas of security, unemployment and efforts to bring governance closer to the people.

He described agriculture as the best way to diversify the economy, saying this would bridge the gap in the allocation of resources to states from the Federation Account.

Benmassoud said the states needed information about what they could do to diversify the economy towards the agricultural sector from the reliance on oil and gas.

“The Fadama projects initiated by the World Bank could be expanded and improved upon because they are for small scale farmers. Agriculture has to be a commercial business because it has to provide alternative sources of funding for government programmes since there is a decline in the oil and gas revenue.

“I was stunned when I learnt that Nigeria which used to be a food exporting country is now importing about $3billion food annually. The nation has the capacity to produce locally, foods that are being imported into the country,” he said.

Chairman of the Committee, Shehu Sani, stressed the need for the judicious use of loans borrowed by government at all levels in order not to subject the people to unnecessary liabilities.

“I want to call on the Federal Government to discourage state government from borrowing under Development Policy Operation. We want to see future borrowings tied to specific projects for accountability and transparency,” he said.