Speaking on “inequality, growth and resilience” at George Washington University, USA, Okonjo-Iweala said Nigeria was able to save $22 billion under former president Olusegun Obasanjo, which saved the country in 2008, when there was global economic meltdown.
According to her, the World Bank and the International Monetary Fund (IMF) must seek means to embed savings in national constitutions devoid of political manipulations.
Okonjo-Iweala said: “We tried it in Nigeria, we put in an oil price based fiscal rule in 2004 and it worked very well.
“We saved $22 billion because the political will to do it was there. And when the 2008 /2009 crisis came, we were able to draw on those savings precisely to issue about a 5% of GDP fiscal stimulus to the economy and we never had to come to the bank or the fund.
“This time around and this is the key now, you need not only need to have the instrument but you also need the political will. In my second time as a finance minister, from 2011 to 2015, we had the instrument, we had the means, we had done it before, but zero political will.
“So we were not able to save when we should have. That is why you find that Nigeria is now in the situation it is in. Along with so many other countries.”
On solving the problem of political will and political manipulations, she said:
“That is the question that I ask, what do we need to do to these countries to save over a period of long accelerated growth. “We need to devise mechanisms not just that are good technically but find a way to either embed them in the constitution or find a way to separate them from the political manipulation so that these countries can survive over time.
“To build resilience, African countries need tools, mechanisms and it is doable and we need to interrogate ourselves why we have not done it.” She added that manufacturing was also critical to growth in Nigeria and the rest of Africa, quoting manufacturing as just 11% of GDP in Africa, and 9% in Nigeria.
“I do not believe that we can be resilient, except if we can encourage manufacturing even on the goods we consume, services, entertainment industry, and agriculture. “I think these are the kinds of questions that policy makers struggle with on a daily basis and that is what we are going to answer to get resilience.
“If we don’t get these mechanisms, we politicise them, find ways to transform the base of the economy and create jobs including in manufacturing, I believe we are going to go into this looming deceleration that is being talked about.” Okonjo-Iweala had last month said that although those who steal must be made to pay for their deeds, the best way to fight corruption in the country is by employing technology and building institutions.
She said: “We have to fight corruption in two ways; one is by punishing those who steal, and making sure they pay for what they do. “But we also must plug all the holes by building institutions and systems that prevent corruption in the first place.
“If you have a financial system for running your financial accounts that is not computerised, that is not technologically based, you’re still transferring cash, as we were doing in my country up until 2003, 2004, then you’re opening up the place to a lot of people leaking.”
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