fash1964: The situation is similar to someone being accused of having 15 wives who denied the allegation but admitted to having only 12. The crux of the matter here is depletion of very substantial amount of foreign reserve with nothing to show for it. This is what needs to be addressed. What happened to our foreign reserve (either $45bn or $67bn)?

Omo_Tier1:
I am sure folks like you were day dreaming when the debate of excess crude account was raging during Obj's tenure. Foreign reserves and ECA are two separate accounts even though one gets its funds from the other..

By the way, let me put up her speech excerpts as reported by Thisday newspaper which is owned by PDP.

Dr. Oby Ezekwesili,


Davidson Iriekpen
A former Minister of Education in the Olusegun Obasanjo administration, Dr. Oby Ezekwesili, has stated that the squandering of $45 billion in foreign reserves and $22 billion in the Excess Crude Account (ECA) by the Yar’Adua-Jonathan administration is “the most egregious” instance of Nigeria’s failure to make the right developmental choices.


Ezekwesili, also a former vice-president (Africa) at the World Bank, stated Thursday at the convocation lecture of the University of Nigeria, Nsukka (UNN) that Nigerians had lost dignity because of the ravaging poverty arising from poor choices of the elite, corruption and lack of investment in education.


Noting that Nigeria had enjoyed five cycles of oil boom, she decried the failure to convert oil income to renewable assets through the development of human capital, development of other sectors or investment in foreign assets as other resource-rich countries have done with their oil income.


Ezekwesili, a founding director of Transparency International (TI), asserted, “The present cycle of boom of the current decade is much more vexing than the other four that happened in the 70s, 80s, 90s and 2000s.


“This is because we are still caught up in it and it is more egregious than the other periods in revealing that we learned absolutely nothing from the previous massive failures.”


She lamented the “squandering of the significant sum of $45 billion in foreign reserves and another $22 billion in the Excess Crude Account, being direct savings from increased earnings from oil that the Obasanjo administration handed over to the successor government in 2007”.


She stated: “Six years after the administration I served handed over such humongous national wealth to another one, most Nigerians but especially the poor continue to suffer the effects of failing public health and education systems as well as decrepit infrastructure and battered institutions.”


She queried: “One cannot but ask what exactly symbolises this level of brazen misappropriation of public resources? Where did all that money go?


“Where is the accountability for the use of both these resources and the additional several hundred of dollars realised from oil sales by the two administrations that have governed our nation in the last five years?
“How were these resources applied or more appropriately misapplied? Tragic choices.”


Ezekwesili advised the graduating students of UNN and other educated young people to become the turning point generation of young and educated Nigerians willing to make the right choices by serving or having a say in political affairs of the country.


She said that sorting out the “Nigerian political mess” is critical as there is a strong correlation between politics and economic development.


According to her, university graduates account for 4.3 per cent of Nigeria’s youthful population in 2013, a slight increase from the 3 per cent when she graduated in 1985.


“This compares unfavourably with opportunities for university education in other countries put at 37.5 per cent in Chile, 33.7 per cent in Singapore, 28.2 per cent for Malaysia and 16.5 per cent for Brazil,” she said.


Ezekwesili linked Nigeria’s poor capital formation to the low development of its people through education.
“Our lag in tertiary education enrolment is quite revealing and could be interpreted as the basis of the competitiveness gap between the same set of countries and Nigeria.


“The countries with the most highly educated citizens are also some of the wealthiest in the world, revealed a study by the OECD published by the Wall Street Journal last year,” she observed.
She posited that it was up to the younger generation to restore the dignity of Nigeria by making the right choices to lift the nation out of poverty.


She also described Nigeria as “a paradox of the kind of wealth that breeds penury,” noting “the trend of Nigeria’s population in poverty since 1980 to 2010 suggests that the more we earned from oil, the larger the population of poor citizens.”
The figures of the poor in Nigeria grew from 17.1 million in 1980, 34.5 million in 1985, 39.2 million in 1992, 67.1 million in 1996, to 68.7 million in 2004 and 112.47 million in 2010, she said.


Ezekwesili espoused a new vision for Nigeria couched simply as “we believe in dignity”. She said the resurgence of entrepreneurial spirit based on hard work and sound education were critical factors to changing Nigeria.
“For Nigeria’s dignity to be restored, your generation must build a coalition of young entrepreneurial minds that are ready to ask and respond to the question: What does it take for nations to become rich?


“Throughout economic history, the factors that determine which nations became rich and improved the standard of living of their citizens read like a Dignity Treatise in that they all revolve around the choices that ordinary citizens made in defining the value constructs of their nation,” she said.


The 42nd convocation ceremony of the UNN commenced yesterday with the convocation lecture and the Prize and Awards night for distinguished graduands.


First degree holders, numbering 18,150, would receive their certificates today, while higher degrees and honorary awards would be awarded tomorrow and conferred on 1,730 recipients.

yommys01: Are you suggesting she should allow herself to be compromised like others you mentioned have? How come the government have never come out to properly defend themselves instead of going for cheap blackmail like they have always done?

Any reason why they don't want the public debate?

Ride on Oby.

taharqa: I just dey laugh. So its not $67bn, but $45bn (since d ECA is a SUBSET of d Foreign Reserves as she just admittd). The Govt guys were right aftall.... By d way, what took Ezekwesili this long to mk dis clarification. She shld be careful so that Politics and a quest for Power by sm people, do not destroy whateva reputatn she has of not bn friviolous..... Ova now to those Resident IJIOTS who were arguing with sm of us when dis issue were trending then. @Gbawe, @Demdem, @Omo-koko, @Lacasa, @Seanten1, @Garriman, etc

taharqa: I just dey laugh. So its not $67bn, but $45bn (since d ECA is a SUBSET of d Foreign Reserves as she just admittd). The Govt guys were right aftall.... By d way, what took Ezekwesili this long to mk dis clarification. She shld be careful so that Politics and a quest for Power by sm people, do not destroy whateva reputatn she has of not bn friviolous..... Ova now to those Resident IJIOTS who were arguing with sm of us when dis issue were trending then. @Gbawe, @Demdem, @Omo-koko, @Lacasa, @Seanten1, @Garriman, etc

mikeapollo:

Dont mind this attention-seeking woman. She was the head of the so-called 'Due Process Office' under Obasanjo when over $16Billion was spent on power projects with nothing to show for it. Some of the money was even paid to fictitious and non-existing companies.

She belongs to the Obasanjo camp....together with Fani-Kayode, Soludo, El-Rufai and Ribadu etc. They are making noise to seek attention because they are no longer favoured by the government.

During the power-probe, she rushed down from US to come and defend Obasanjo.

A few weeks ago, she was at a PDP event to celebrate Obasanjo, and she was eulogising Obasanjo to high heavens, despite all the corruption in his govt.

I am not a fan of GEJ or PDP, but I dont like hypocrites. When they were in govt, they were telling us that all was well....but all of a sudden, they have turned into 'emergency activists' because they are out of favour. HYPOCRITES!

Any good follower of International Economics knows that Nigeria was able to save much because the price of Oil went to as high as $140/barrel during the economic boom of 2003-2007. It is common sense that the external reserves would be negatively affected when the price of oil fell to below $40/barrel for about 2 years.

Ezekwesili will be embarrased if Okonjo-Iweala comes out to debunk her claims.....afterall, Okonjo was the Finance Minister and the person who allegedly helped her to get the WB job, and invariably her senior too

The FG should ignore her. She cant even face Sanusi

mathewalab:










That is why people like you failed JAMB / WAEC / SCHOOL EXAMS and later came out to say they failed you - simple expression of Oby you can not decode "45 + 22 = 67" abi you U no rite your final exam or watin.

Her expression simply means $45B foreign reserve and $22B ECA, FOREIGN RESERVE stood on its own and additional ECA; which is a sub-set of Foreign Reserve ( Garri plus garri water, everytin no be GARRI)

Becareful there before I commot my gun


That is why people like you failed JAMB / WAEC / SCHOOL EXAMS and later came out to say they failed you - simple expression of Oby you can not decode "45 + 22 = 67" abi you U no rite your final exam or watin.

Her expression simply means $45B foreign reserve and $22B ECA, FOREIGN RESERVE stood on its own and additional ECA; which is a sub-set of Foreign Reserve ( Garri plus garri water, everytin no be GARRI)

Becareful there before I commot my gun

Afam4evaIsASlut:

When eternal fools like urself lie, do you think youre deceiving the rest of the world? How much is $45bln + $22bln? So whats ur argument?

njokusboy:

Lolzzz, I assume u have a higher degree but u don't know set theorem in mathematics.
Welldone sir.

njokusboy:

Gosh, am appalled by the rate of ignorance in nairaland. Look how some dudes re insulting economics nd u re castigating someone dat understands it better than you. Do u tink dis is onitsha main market where u just count money anyhow?? The GNP is 30millon and net factor income from abroad is 20 million, does dat make the GNP 50million? Knowing full well dat net factor income from abroad is a subset of the GNP. Hell yeah, u don't understand, why not kip quiet?? D subset means dat one is got from the other.meaning dat the net factor income from abroad was added to some other figure (GDP precisely) to get the GNP. Therefore d GNP is Still 30million not 30+20. In dis case, d ECA is a subset of d foreign reserves account so d foreign reserve account is still $45b. U add d ECA to some other figure( in dis case $23b) to get the foreign reserves account. And not adding the foreign reserves to d ECA to get another figure. I know u don't still understand, so learn to skip issues about which u re clueless.

Ud&pconcept:
oga abeg let ask u has world bank started given top jobs 2 economic illiterate as u refer her 2. who kows were u are practicing ur own economics may be as an akawo collector.........

taharqa: NO. Plz read tru d article again. The ECA is a SUBSET of Foreign Reserves. She admittd that much in dis article. If we say that today that the Reserves is $48bn, we also mean that that is INCLUSIVE of almost $11bn in d ECA- you dont add d $11bn to $48bn and say d Reserves is $59bn. This was exactly d point sm of us hv bn trying to get across to FRUSTRATED 'SUBHUMANS' like @Demdem.... There was NEVER $67bn Reserves at any time. OBJ left a little above $45bn (ECA inclusives)

calcal: over 100 millions of our people are sleeping without food everyday and yet we have FR for what?

fash1964: The situation is similar to someone being accused of having 15 wives who denied the allegation but admitted to having only 12. The crux of the matter here is depletion of very substantial amount of foreign reserve with nothing to show for it. This is what needs to be addressed. What happened to our foreign reserve (either $45bn or $67bn)?

daywatcher: someone pitching for a juicy position in case APC wins in 2015

oya Sanusi, we are waiting for your response







1st to comment...Glory to Sango

Gennyz: Jonathan is not helping our economy,pls let vote him out come 2015.Imagine him buyin more private jets making us have 11 private jets while England doesnt even have one,our 2013 has a budget 1.4 billion for chopper.People had to protest for them to start earnin 18,000 minimum wage,feeding for Jonathan na 1.4billion wetin dis man dey eat,na "Manna frm Heaven"

naijaguy77: This is Economic Illiteracy at the highest level. I used hold Madam Ezekwesili in high regard until this issue.

The foreign reserve is the foreign currency we get when we export our goods or services. Since we cannot spend dollars in Nigeria, we print the Naira equivalent of the dollar and spend i.e. If Mr Okoro exports cassava to USA, he earns $$s, he can't pay his farmers in $$s, nor can he buy other goods and services, so he takes his dollars to the bank (cbn), they print the naira equivalent and give to him, cbn collects the dollars and keeps in the Forex Reserve. 2 weeks later, Mr Okoro wants to import machinery for his business, he has naira but needs $$s, he takes his naira to cbn, who then exchange it and give him $$ equivalent taken from our Forex Reserve.

Anytime you pop champagne in a club, invite Kim Kardashian, or buy a car, you are contributing to the depletion of our Forex Reserve. Anytime you consume imported goods or services that have to ultimately be paid for using forex, you are contributing to the depletion of the Forex Reserve. It is that simple.

The Forex Reserve is not such a big deal, it is just a mechanism/tool used by the CBN for stabilising the local currency. So is it correct to accuse the FG of squandering the Forex Reserve? NO. Anyone who makes such an accusation is more or less an economic illiterate. The following can easily lead to the depletion of Forex Reserve:

1) Increase in consumption of Foreign Goods and Services. E.g. Cars, Food, Foreign Education, Machinery, Expatriate worker demand, or Kim Kadashian.

2) Decrease in value of export. E.g. Fall in oil prices.

3) Increase in the value of the Naira against the Forex Reserve currency.

4) A combination of some or all of the above.

The following points above mean that, NO matter how PRUDENT the FG is, the forex reserve can still be depleted by the lack of productivity of the economy, or the profligacy and foreign taste of the citizens. It is therefore very silly to accuse the FG of squandering the Forex Reserve.

Does FG also contribute to depletion of FR? YES, but nothing on the scale of other consumers in the economy. The FG would need forex just like other stakeholders in the economy, and their need, relatively speaking, is certainly not huge as the rest of the country combined. Ironically, it is the FG, through oil export earnings by NNPC and Oil companies, that is the largest contributor to the Forex Reserve.

Economic Illiteracy can make you look stupid, it certain has done so the Madam Ezekwesili.

Stay tuned for part 2 - Excess Crude Account (ECA)

taharqa: NO. Plz read tru d article again. The ECA is a SUBSET of Foreign Reserves. She admittd that much in dis article. If we say that today that the Reserves is $48bn, we also mean that that is INCLUSIVE of almost $11bn in d ECA- you dont add d $11bn to $48bn and say d Reserves is $59bn. This was exactly d point sm of us hv bn trying to get across to FRUSTRATED 'SUBHUMANS' like @Demdem.... There was NEVER $67bn Reserves at any time. OBJ left a little above $45bn (ECA inclusives)

Yeske!:
Exactly, don't know Why the FG is so scared about the debate.

KingPradas: Carlos slim is richer than our foreign reserve. lol