Nigeria Is World's 'Second Worst' In Use Of Sovereign Wealth Funds - IMF
IMF president Christine Largade/Photo: AFP

Nigeria has been ranked by the International Monetary Fund (IMF) as the second worst country in the world in the use of sovereign wealth funds.

Concise News reports that this was contained in the Fiscal Monitor report released on Wednesday by the IMF, with Qatar the only country worse than Nigeria on the index.

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According to the Bretton Wood institution, 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 considered.

The IMF said it used data compiled by the Natural Resource Governance Institute and Worldwide Governance Indicators.

“It is critical to develop a strong institutional framework to manage these resources—including good management of the financial assets kept in sovereign wealth funds—and to ensure that proceeds are appropriately spent,” the report read.

“This remains a significant challenge in many resource-rich countries that, on average, have weaker institutions and higher corruption

“The governance challenges of commodity-rich countries— that is, the management of public assets— call for ensuring a high degree of transparency and accountability in the exploration of such resources.

“Countries should develop frameworks that limit discretion, given the high risk of abuse, and allow for heavy scrutiny.”

The IMF in explaining that sovereign wealth funds have to be transparent, advised that countries should ensure that the natural resources of countries should be channelled properly to the people that need them.

Nigeria’s West African neighbours Ghana was ranked first among the 10 African countries considered.