Abstract
Oil-dependent economies face two interrelated challenges in the management of oil resources: in the short run, there is the need to create a stable macroeconomic environment by delinking oil revenue earnings from public expenditures, while in the long run it is necessary to maintain a sustainable use of resources that ensures intergenerational equity. In most of the past three decades, Nigeria’s management of oil resources was poor. The Nigerian economy has experienced significant macroeconomic volatility, driven largely by external terms-of-trade shocks, the country’s large reliance on oil export earnings and poor policy choices in the management of oil revenues. By some measures, Nigeria ranked among the most volatile economies in the world for the period 1960–2000 (Chapter 3). Moreover, contrary to the received wisdom of increasing financial assets as a means of saving oil revenues, Nigeria had accrued significant domestic and foreign liabilities.
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© 2008 Paul Collier, Chukwuma C. Soludo and the International Monetary Fund
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Okogu, B., Osafo-Kwaako, P. (2008). Issues in Fiscal Policy Management under the Economic Reforms (2003–7). In: Collier, P., Soludo, C.C., Pattillo, C. (eds) Economic Policy Options for a Prosperous Nigeria. Palgrave Macmillan, London. https://doi.org/10.1057/9780230583191_9
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DOI: https://doi.org/10.1057/9780230583191_9
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