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Okonjo-Iweala: Profile of the debt relief campaigner

Posted by By Emma Ujah on 2006/08/04 | Views: 622 |

Okonjo-Iweala: Profile of the debt relief campaigner

Dr. Ngozi Okonjo-Iweala was born on June 13, 1954 to the family of the renowned Economist, Professor Okonjo of the University of Ibadan.....

Dr. Ngozi Okonjo-Iweala was born on June 13, 1954 to the family of the renowned Economist, Professor Okonjo of the University of Ibadan . She studied Economics at Harvard where she obtained her Bachelor Degree in 1981 and later followed it up with a Ph.D. in Regional Economics and Development from M.I.T, Massachusetts .

She was appointed Nigeria’s first female Minister of Finance, on July 15, 2003, where she called the shots until June 21. Five weeks ago she was redeployed to the Ministry of Foreign Affairs, in circumstances that left more questions than answers.

Before her appointment as Minister of Finance, Ngozi who was Vice President, World Bank and Board Secretary. She had taken a leave of absence from her position in 2000 to return home to help fix the nation's economy and external debt portfolio. On assumption of office, she assisted the President in setting up the Economic management team which met with the President weekly to take key economic decision. One of the product of the meeting is the economic reform agenda introduced by the Obasanjo administration which was directly supervised by her ministry. The reforms, ensured prudent management of the nation's resources, enthroned transparency which led to the monthly publication of the revenue allocation to states and local governments. The reform also ensure that due process was put in place and that the country has value for money spent on projects. The reform focused on debt relief and she pursued it with vigour and Nigeria was favoured with $18billion debt reduction. But the eventual payment of $12billion by the Federal Government to exit the Paris club drew sharp crticism from both within and outside Nigeria.

She help the setting up of the Debt Management Office (DMO) which has Dr. Mansur Muhtar as Director-General. Until then, there was no database on the nation's foreign debts and so even government officials had no information on the country's level of indebtedness nor how much had been paid to creditors.

Returning home was said to be in response to President Olusegun Obasanjos appeal for the Economist to assist in putting the nation's economy in shape.


The first storm she rode was over her salary. She was said to have been given an annual pay of about $240,000, as against the pay of her colleagues in the cabinet who were offered the naira equivalent of about $6,000. The dust eventually settled, with the Federal Government explaining that she was going to be paid from a Special United Nations (UN) Fund meant to attract experts from developing nations abroad to return home and help develop their nations. Besides, she was not the only person enjoying the special pay, as according to government, the former Minister of Foreign Affairs, Mr. Olu Adeniji also had the same package.

But there was, as it were, some level of dislike for the Minister not just for her superior, or perceived special treatment but also for insisting that it could no longer be business as usual.
Besides the fat pay issue, the Dr. Okonjo-Iweala could hardly be described as a figure that was liked by governors for two reasons. They did not appreciate her anti-corruption stance and policy of saving the excess crude revenue. Until her appointment, all federally collected revenue for each month was shared among the three tiers of government, leaving the Federation Account empty. Consequently, there was no funds to fall back on in times of oil price crash- a situation that often led to high budget deficits at all levels.

Another major controversy was the wisdom of paying out the huge sum of $12.1 billion to exit the Paris Club. Critics of the former minister said all countries owe debts and that the huge money paid to the creditors could have been invested and the proceeds used to service the debts. She was also accused of personal benefits from the debt deal, as critics alleged that her brothers brought in the 'Lazard Fries' which acted as consultants to the nation in the deal.

An accusation that she vehemently denied, as according to her, the consultants had been working on the Nigerian debt since the 1990s, long before she was appointed Minister of Finance.
She was also accused of using her position to secure consulting contracts for members of her family, particularly at the Ministry of Federal Capital Territory, where Nasir el-Rufai, holds sway. It took spirited efforts for her to explain that her brothers were already doing various jobs in the country, before she returned home to join the government.

She was also accused of deceiving Nigerians on the foreign reserve stock. And that it illegally took funds from the reserves to pay for Power Projects and extended census without approval from the National Assembly. An allegation Dr. Okonjo-Iweala cleared on the eve of her removal, as Minister of Finance.


Okonjo Iweala would ever be remembered for the debt relief she secured for Nigeria. She used her relationship with the shakers and movers of international finance to win their support for debt relief for Nigeria. Negotiating with the creditors was more like being among her peers. Even the approval of the National Economic Empowerment and Development Strategy (NEEDS) as the Programme Support Instrument (PSI) by the International Monetary Fund (IMF) was unprecedented. No other nation had received debt relief without an IMF programme.
Under her administration, Nigeria which did not qualify to enjoy the assistance of the World Bank under the Highly Indebted Poor Country (HIPC) initiative was considered to enjoy other windows of concessionary facilities and grants.

High foreign reserve has consistently characterized the nation's macro economy while she was Minister. The last stock, before she left was about $34 billion. Equally, her insistence on saving for the rainy day has yielded fruits as about $25 billion has been saved in the excess crude oil account, as at end of the first half of the year.

The macro-economy has been largely stable with increased foreign exchange inflow which has helped to stabilize the exchange rate of the naira, and even record a marginal firming up of the Naira, against the dollar, at the foreign exchange market.

Okonjo-Iweala Vs Nenadi Usman

They two could be said to have had a cordial working relationship throughout the period, July 2003 to June 21, when Okonjo-Iweala was redeployed. On several occasions, Mrs. Usman simply declined elaborate comments, after Dr. Okonjo-Iweala, had spoken at functions, preferring rather to remain more at the background. She used every opportunity to declare that Okonjo-Iweala was her boss. But one thing she could not hide was that she was learning the ropes of macro economic management fast, may be faster than anyone could have imagined. Responding to journalists questions, soon after her appointment as Minister of Finance, Mrs. Usman said she had no reason, whatsoever, to alter the decisions earlier announced by Dr. Okonjko-Iweala, on various macro- economic policy issues, as according to her, we took the decisions together.

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