Nigeria to Put Excess Oil Sales in Wealth Fund, Aganga Says

Businessweek (Bloomberg)

17 May 2011

Nigeria to Put Excess Oil Sales in Wealth Fund, Aganga Says

May 17 (Bloomberg) -- Nigeria will put aside oil revenue earned when prices exceed what is used to calculate the government budget for the country’s new sovereign wealth fund, Finance Minister Olusegun Aganga said.

A dependence on oil brings risks including the inherent volatility of prices and the impact that boom and bust revenue cycles can have on inflation, fiscal planning, and budgetary prudence, Aganga said today in an e-mailed statement from the capital, Abuja.

The fund “will help Nigeria mitigate these risks in the same way that sovereign wealth funds are now a fundamental component of macroeconomic wealth management by natural- resource-rich countries around the world,” Aganga said.

Nigeria’s House of Representatives passed the sovereign wealth fund bill today after the Senate unanimously approved it on May 11 with seed capital of $1 billion. President Goodluck Jonathan will have to sign the legislation before it becomes law