Okonjo-Iweala said this when she briefed journalists on Nigerian Delegation’s participation at the Annual meetings of the World Bank and IMF, in Washington DC.
She said there had been a contingency plan to ensure that the economy did not suffer in spite of the drop in global oil price.
“First, we have to realise the dimensions of the situation and we are beginning to do that. With the team here, the D-G Budget, the Central Bank, we are looking at various scenarios.
“We are running our models in terms of the oil price shocks and so on, even quality shocks. And when you look at contingency scenarios, there are three ways you can manage them,” she said.
According to her, “you can either go outside and get resources to manage the system, but we are not planning to do that. We are not going outside to get resources at this moment. That is the pride that we have had”.
She said that from the revenue side some positive result had emerged with additional income from to the Federal Inland Revenue Services.
“Because we were ahead of the curve in trying to bring on some extra help to FIRS, we gave a target of 500 million dollars which is about N75 billion to the FIRS backed by the McKinsey.
“That is helping to strengthen their capacity to improve audits and plug leakages. I am happy to say that of the N75 billion target, they have already hit N44 billion of additional revenues in July.
“So, at least we will be able to increase our revenues, that has actually helped us,” she said
The Minister said that other area the team had been looking at was the expenditure side, which she said government had to be very careful in handling.
She reiterated the need to build up buffer such as the Excess Crude Account to help reduce any shock the economy might experience.
Commenting on the advice by IMF and World Bank on effective management of the economy at the meeting, she said they advised Nigeria to raise its buffer to 6.3 billion dollars.
“The IMF told us that we need a buffer of 6.3 billion dollars. We are at a buffer of about 4.1 billion dollars. So we have a little bit of short fall in the buffer but we have been able to manage it and I strongly believe that we can keep this economy on an even kiln even with that.
“We were estimating a buffer of five billion dollars, they thought we needed more and we have been moving towards that. So, we will look at our buffer and see how we strengthen it,” she said
She also said that the team would equally look at the expenditure side to see what could be done and assured that the economy would be effectively managed.
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