Despite the benefits and the huge revenues that have accrued from oil and gas over the years, Nigeria has one of the lowest natural resource revenue savings in the world.

Waziri Adio, Executive Secretary of the Nigerian Extractive Industries Transparency Initiative (NEITI), said this in Abuja on Friday during the launch of an occasional paper titled ‘The case for a robust oil savings fund for Nigeria‘.

According to the paper, the balance in the three saving funds is less than $3.9 billion, which is not enough to fund 20% of the 2017 budget.

Based on the findings of the research, NEITI argued that a national consensus on savings on tomorrow has become urgent to prepare the country to overcome frequent commodity price volatility and depletion of non-renewable resources.

It noted that portions of mineral resources revenues that are excluded from the national budget and held as part of a country’s reserve can greatly enhance a country’s capital balances, attract greater investors’ confidence and significant flow of foreign capital into the economy.

These funds also support the provision of critical infrastructure and social interventions during major national emergencies, it said.

NEITI explained that while Nigeria has three oil savings funds — Sovereign Wealth Fund with $1.5bn, Excess Crude Account with $2.3bn and Stabilisation Fund with N29.02bn ($95m) — with a combined saving of $3.9bn as of June 2017, the country exported crude oil worth about $1.09 trn between 1980 and 2015

Therefore, NEITI said the time has come for Nigeria to fully embrace “a robust policy to save a portion of oil and gas revenue for the rainy day and for the next generation”.

“Our paltry oil savings defeat the rationale for having such savings in the first place,” said Adio.

“Nigeria does not have enough oil savings to finance even a fifth of a year’s budget at the federal level, not to talk of having enough for investments or for the future generation.”

He urged the federal government to take urgent measures, such as the immediate transfer of all revenue savings in the stabilization fund and the Excess Crude Account into the Nigerian Sovereign Wealth Fund, and the delinking government expenditure from oil revenues.