The governors of Nigeria’s 36 states will go ahead with their law suit challenging the legal standing of the country’s $1 billion sovereign wealth fund.
The operation of the fund by the federal government violates a constitutional provision that all government revenue must be shared among that states and the center, the governors said in a joint statement e-mailed today.
The governors had given their approval in June for the appointment of a board and management for the Nigerian Sovereign Wealth Investment Authority and the initial withdrawal of $1 billion to start the fund. They made no comment at the time on the status of the suit pending before the Supreme Court challenging the sovereign wealth-fund law.
The Nigerian Governors’ Forum “unanimously decided to head back to court to enforce” the federal government’s “adherence to the constitution,” according to their statement.
Nigeria’s sovereign wealth law requires the creation of funds for infrastructure, future generation and budget stabilization, with each representing at least 20 percent of the total. Savings through the fund will enable Africa’s top oil producer to build its infrastructure and provide a buffer against volatility in oil prices, Finance Minister Ngozi Okonjo- Iweala said on Aug. 28.
The West African country relies on crude exports for about 95 percent of its foreign-currency earnings and about 80 percent of government revenue, according to the Finance Ministry.
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