Tightrope act

23 May 2013 By Martin Hutchinson

The budget is under control, bad banks are being sold, the sovereign wealth fund opens soon and growth is over 6 pct. But a rebellion could hinder President Goodluck Jonathan’s progress. Combining careful anti-insurgent activity with solid economic management is a tall order.

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Nigeria’s GDP grew at an annual rate of 6.6 percent in the first quarter of 2013, with the non-oil sector growing at 7.9 percent and the oil sector declining at an annualized 0.5 percent. The Consumer Price Index rose by 9.1 percent year-on-year in April 2013. Nigeria’s budget deficit was 2.9 percent of GDP in 2012 and is projected at 1.9 percent of GDP in 2013.
Nigerian President Goodluck Jonathan declared a state of emergency in the states of Borno, Yobe and Adamawa in northeast Nigeria on May 13, as the insurgency by Boko Haram Islamist militants expanded. The Nigerian government claimed on May 20 that attacks on rebel bases had met with initial success.
The Asset Management Company of Nigeria announced that it would sell its shares in three nationalized banks by the third quarter of 2014 and would repay 2 trillion naira ($13 billion) of bonds by the end of 2013.
Nigeria’s sovereign wealth fund announced on May 21 that it will begin investment in June, with 32.5 percent in infrastructure, 32.5 percent in savings for future generations, 20 percent to protect against commodity price shocks and 15 percent unallocated.

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