Experts support IMF’s position on Nigeria’s sovereign wealth fund

President Muhammadu Buhari and The Managing Director of the International Monetary Fund (IMF), Mrs Christine Lagarde.                                 PHOTO: SUNDAY AGHAEZE

By FELIX OLOYEDE

The International Monetary Fund (IMF) was right in ranking Nigeria’s sovereign wealth funds the world’s second worst, only above Qatar, financial experts have told Business Hallmark.

It Fund in its report released on Tuesday, said Nigeria lacks transparency and corporate governance is the management of its sovereign wealth funds.

Dr. Adi Bongo, an economist and Faculty Member of the Lagos Business School said information about the management of the country’s sovereign wealth funds has been shrouded.

He claimed he knows nothing about the fund even as a financial expert.

“It has been abused! I think we almost turned to another government ATM subverting the terms and conditions of the Act,” Dr. Boniface Chizea, an economist and Managing Consultant, BIC Consultancy Services told Business Hallmark via WhatsApp.

The IMF explained that the index was compiled using the corporate governance and transparency scores of the sovereign wealth funds and the size of assets as a percentage of 2016 GDP of the countries.

The low ranking of Nigeria’s sovereign wealth funds shows that there is a need for strong institutions, transparency in the management of the fund and there is a need for political will to continue to safe more in the Fund, Moses Ojo, Head, Research and Business Development, PanAfrican Capital noted.

Meanwhile, Nigeria Sovereign Investment Authority (NSIA) in a statement by Titilope Olubiyi, its Communications Adviser argued that ‘report does not reference the Nigerian Sovereign Investment Authority, and that sweeping reference to the Nigeria’s Sovereign Wealth Fund and the use of third-party data raises concerns.
“‘NSIA was established under the Santiago Principles, which consists of 24 generally accepted principles and practices voluntarily endorsed by International Forum of Sovereign Wealth Funds (IFSWF). The Santiago Principles promote transparency, good governance, accountability and prudent investment practices whilst encouraging a more open dialogue and deeper understanding of Sovereign Wealth Fund activities,” it stated.

Columbia, Ghana and Chile were ranked best three in the management of their sovereign wealth funds.