162 • The exchange rate has become relatively stable following liberalisation in 2006, thereby allowing greater flexibility in exchange rates. • The inflation rate has been reduced from 23 per cent in 2003 to below 10 per cent in 2006 and 2007. • Chronic fiscal deficits have given way to consolidated surpluses. • The overall fiscal balance has been improved from the previous 3.5 per cent budget deficit to a fiscal surplus of 10 per cent of GDP in 2004 and 11 per cent in 2005. • External reserves have increased markedly to US$40 billion in 2006. • There has been strong economic growth of almost 7 per cent in 2005 and 2006. • There has been strong nonoil-sector growth of about 8 per cent. 529. The Nigerian economy has benefited in recent years mainly from the high price of oil and the gains in efficiency brought about by economic reforms. The real GDP growth rate averaged 6 per cent for the period 2002 to 2006. However, this growth rate still falls short of the NEEDS target of 10 per cent needed to achieve many of the MDGs. Moreover, after peaking at about 10 per cent in 2003, real GDP growth slowed from 6.2 per cent in 2005 to 5.67 per cent in 2006 because of the disruptions to oil production in the Niger Delta. On the other hand, nonoil-sector growth has been encouraging. Real nonoil GDP grew by 8.9 per cent in 2006 and 8.6 per cent in 2005. On the other hand, oil output reduced by 4.7 per cent in 2006 and by 0.5 per cent in 2005. 530. The main drivers of growth in the nonoil sector were telecommunications, general commerce, manufacturing, agriculture and services. The communications sector in Nigeria has been experiencing a boom in the last five years. Its average growth of about 30 per cent per annum was driven largely by the expansion of GSM services. Large inflows of foreign direct investment (FDI) have also played a crucial role, jumping from US$50 million in 1999 to US$7.5 billion in 2005. The number of mobile phone lines has increased from below 250,000 in 1999 to nearly 20 million in 2005. Teledensity achieved 15.7 lines per 100 inhabitants. The tremendous progress made in telecommunications has contributed to an overall improvement in the business climate, and has benefited the manufacturing sector especially. 531. Nigeria’s management of its debt appears to comply with the standard requirements defined in the Guidelines for Public Debt Management. CRM discussions revealed that steps were being taken to improve the legislative framework, design a better organisational framework, clarify mandates and roles, consolidate debt management functions, increase bank supervision, and restructure the banking system.