Nigeria on Tuesday signed a Memorandum of Understanding with The Gambia to avail the foreign nation Nigeria’s vast knowledge, experience and technical expertise on the implementation of the Treasury Single Account.
Minister of Finance, Budget and National Planning, Zainab Ahmed, who signed on behalf of Nigeria in Abuja, said the MoU was based on the recommendation of the International Monetary Fund.
She also told her guests that Nigeria was saving about N45bn monthly through the implementation of the TSA, adding that The Gambia had in 2019 requested for technical cooperation with Nigeria to support its own transition to TSA.
In her remarks at the MoU signing ceremony, which was made available to our correspondent in Abuja, the minister further stated that Nigeria would export other Public Financial Management reforms to The Gambia.
Ahmed said, “The cooperation seeks to avail the Ministry of Finance and Economic Affairs of The Gambia with the vast knowledge, experience and technical expertise that Nigeria has gained in the past 15 years of implementing TSA in particular and other Public Financial Management reforms, in general.
“By so doing, The Gambia is properly guided as it implements its own TSA. The cooperation will enable The Gambia to leverage on the experience of Nigeria to build on our strengths while avoiding our mistakes.”
On the benefits of TSA implementation in Nigeria, Ahmed stated that it had helped the Federal Government to make monthly savings that run in several billions of naira.
She said, “Implementation of TSA has benefited Nigeria immensely. Among other verifiable benefits, we can now easily determine our aggregate cash balance which is critical for managing public finances at a time of acute fiscal constraints.
“In addition, we are saving average N45bn monthly in interest payments. On the monetary policy side, we have better control over money supply and therefore able to rein in inflation and undue pressure on the naira.”
The minister said the country’s foreign reserve position had also recorded appreciable improvement through the consolidation of Federal Government foreign currency earnings under the TSA.
Ahmed said it was her expectation that The Gambia would enjoy all of these benefits if they diligently implement the TSA.
She, however, told her guests that they would need strong political support to deal with the heavy lifting associated with PFM reforms.
“Do not embark on this journey if you are not confident that you have the buy-in of your topmost political leadership,” the minister told officials from The Gambia.
Speaking for her team, the Permanent Secretary, Ministry of Finance, The Gambia, Ada Gaye, said the visit to Nigeria had helped them to understand the workings of the TSA, adding that her country would adopt the initiative in managing its finances.