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How to halt capital flight, says Aganga

By Emma Ujah, Abuja Bureau Chief
Minister of Finance, Dr. Segun Aganga, has said creating a macro economic environment with low and stable prices, as well as competitive and stable real exchange rates held the key to halting capital flight from developing nations to developed economies of the world.

Addressing Governors of Central Banks of the D8 countries in Abuja, yesterday, he challenged them to work assiduously with a view to creating such environment in member countries to address the capital flight problem.

“If our Central Banks deliver on the environment:  low and  stable prices, competitive and stable real exchange rates in our countries, we  would reduce capital flight from our nations to the developed countries,” he said.

The minister added “as developing countries, we owe it to ourselves a duty to promote trade among ourselves in order to grow our economies at a faster rate than North-South trade would ordinarily afford us.”

According to him, the total population of D8 countries is close to the population of India and China.  But that the combined economic performance of the group does not compare with any of them, explaining:  “D8 countries contribute only  about three per cent of world trade.”

The minister also said the Federal Government was pursuing the Sovereign Wealth Fund in order to safeguard the nation’s future and build a large pool of funds that could be invested in infrastructure development.

He said  the proposed Fund would be divided into three: stabilizing fund, a savings portion and the third to be for the development of infrastructure meant to serve as a catalyst for local and international investors to invest in the nation’s infrastructure development.

In his remarks, the Governor of the Central Bank of Nigeria, CBN, Mr. Sanusi Lamido Sanusi, said the forum examined ways to strengthening surveillance mechanisms, enhancing the domestic financial system and exchange of experiences among member groups.

The governor said “the objectives are to provide the modalities and mechanisms of economic and financial cooperation among member countries.  This interaction is envisaged to deepen and broaden the exchange of ideas among individuals countries for more effective policy implementation as well as, strengthen cooperation among the D8 nations.”


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