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By Dipo Olowookere

Nigeria’s Sovereign Wealth Fund (SWF) has been rated by the International Monetary Fund (IMF) as the second worst in the world.

According to the global money lender, Nigeria is only second to Qatar in the world in the use of sovereign wealth funds.

In its Fiscal Monitor report released on Wednesday, the IMF urged governments to use the funds to increase investment in infrastructure or education to support the economy in the near term, and foster inclusive growth over the next few decades.

“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.

“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 said in the report.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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