IMF gets $7.1m from Switzerland for global resource fund

Hopes may be rising for Nigeria and other natural resource endowed nations as the International Monetary gets the first contribution of $7.1 million into the dedicated fund for capacity development from Switzerland.

The planned pool to uplift management capacity of resource endowed countries known as Managing Natural Resource Wealth Fund was launched in 2011, as a way to help countries manage their natural resource wealth.

According to a report from IMF, Switzerland has now become the first partner to contribute to the new six-year phase (2016–22).

The country has already contributed approximately $71 million since 2010, as supporter of IMF multi‑partner vehicles and used in regional centers of Africa and global funds focused on key topics like the Revenue Mobilization Fund, the Anti-Money Laundering/Combating the Financing of Terrorism Fund, the Tax Administration Diagnostic Assessment Tool and the Managing Natural Resource Wealth Fund.

The Phase 2 of Managing Natural Resource Wealth Fund was launched in three months ago, after the Phase 1 had been deployed into 34 projects in 19 countries, including eight research projects, and five conferences/workshops.

Given Nigeria’s place as a member of IMF, the current growth challenges and huge untapped natural resources, especially in the solid minerals sector, hopes will be high that part of the funds will find their way into the country within the six-year period.

The Head of Economic Cooperation and Development of Switzerland’s State Secretariat for Economic Affairs, Ambassador Raymond Furrer, and IMF’s Deputy Managing Director, Carla Grasso, signed the letter of understanding for Switzerland’s financial contribution on Tuesday, in Bern, Switzerland.

IMF noted that over the last five years, this fund has contributed to significant improvements in a number of countries’ natural resource wealth management through technical assistance and training, analytical work, and diagnostic assessments.

With an approximate budget of $30 million for 2016–22, the new phase will deepen support and possibly expand country coverage, while maintaining its primary focus on resource-rich low- and middle‑income countries.

Grasso said: “I’m happy that Switzerland—as a key contributor to IMF capacity development—will add CHF7 million to support the Managing Natural Resource Wealth Fund’s next phase.

“This phase responds directly to international priorities on effectively mobilizing and managing public revenue, a particularly critical issue for resource-rich countries.

“We look forward to further deepening this partnership and boosting our capacity development efforts in the spirit of the Addis Tax Initiative and the 2030 Agenda for Sustainable Development to the benefit of our member countries.”

But Furrer added: “Switzerland has a longstanding cooperation with the IMF for the delivery of capacity development in partner countries, with first activities going back to the 1990s.

“We are very pleased to build on the successes of the first phase of the Managing Natural Resource Wealth Fund and ramp up our efforts for the second phase.

“Continuing our contribution to this very important initiative allows us to support countries in managing their natural resource revenues in ways that promote economic stability and encourage sustainable and inclusive growth in these countries.”