§ Mr. PageTo ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement about financial relations with Nigeria.
§ Sir Geoffrey HoweThe Nigerian Government's efforts to overcome the country's economic difficulties have been severely affected for some time by the fall in the oil price and its heavy debt burden. Foreign exchange earnings have fallen sharply. This has made it increasingly hard for Nigeria to meet its commitments and to rebuild its economy.
Nigeria is now embarking on a series of important adjustment measures. It has reached agreement with the managing director of the IMF on a new standby arrangement and is negotiating for new loans from the World Bank.
It will be seeking a further restructuring of its official debt in the Paris Club, to supplement the agreement already being negotiated with the commercial banks.
In addition to this, it is clear that Nigeria will require further bilateral assistance in 1989. This will require a concerted effort on the part of the international financial community. I have therefore decided, in consultation with my right hon. Friend the Chancellor of the Exchequer, to offer a grant of US$100 million in 1989, on condition that the standby is approved and that other donors are prepared to make a substantial contribution.
Over two thirds of the cost of the United Kingdom share will come from the reserve and the balance from the existing agreed aid programme.
These arrangements demonstrate the strength of the United Kingdom's interest in the health of the Nigerian economy and our willingness to assist the Nigerian adjustment programme.