through the NEEDS economic reform programme. This strategy was aimed at accelerating economic growth, reducing poverty, and achieving the Millennium Development Goals (MDGs). NEEDS has been consolidated further by the current government through the introduction of a sevenpoint agenda for Nigeria’s development in the context of a broader vision, called Vision 2020. This vision is to position the country as one of the 20 most developed economies internationally by 2020. 8 3.16 These reforms have largely succeeded in reversing the macroeconomic imbalances from which Nigeria suffered for most of the period of political misrule. The country’s macroeconomic indicators show significant improvements. There has been a modest growth in GDP and inflation is lower. Real GDP growth in 2006 was estimated at 5.67 per cent, and inflation dropped to 8.2 per cent from about 18 per cent in 2005. Progress has also been made in the areas of financial-sector reform, debt management, accumulation of foreign reserves, exchange-rate stability, and the fight against corruption. Notwithstanding these positive developments, the Nigerian economy is still confronted by many serious challenges. 3.17 There was inadequate official information to enable the dates of signing, accession and ratification of the economic governance and management standards and codes to be documented. However, it was noted that Nigeria has adopted most of the standards and codes relevant to its membership of the International Monetary Fund (IMF) and the World Bank. They include the adoption of the Guidelines for Public Debt Management, the Code of Good Practices on Transparency in Monetary and Financial Policies, the Core Principles for Effective Banking Supervision, and the IMF’s Code of Good Practices on Fiscal Transparency. 3.18 Current macroeconomic policies are driven by the NEEDS framework. These aim to stabilise the economy in the short term, to achieve internal balance in the medium term, and to move the economy towards attaining external balance in the medium to long term. Macroeconomic management is directed at achieving high and sustained noninflationary growth. The reform programme received a significant boost in December 2006 when the IMF reviewed and approved a two-year Policy Support Instrument (PSI) for Nigeria. The PSI is intended to help the government maintain prudent macroeconomic policies, strengthen financial institutions, and create an environment conducive to robust private-sector development. 3.19 The government has attempted to contain budget deficits by limiting them to no more than 3 per cent of GDP, and by reducing inflation rates to single digits. Furthermore, the government has stabilised the exchange rate, increased external reserves to about US$40 billion in 2006, and registered strong economic growth of slightly above 6 per cent in 2005 and 2006. This includes a strong nonoil-sector growth of about 8 per cent. Public debt has also been kept at sustainable levels since debt relief was obtained under the Multilateral Debt Relief Initiative (MDRI). This has improved Nigeria’s sovereign credit rating enormously. 3.20 Despite these positive developments, macroeconomic policy remains constrained by a low revenue base. This has been caused by high levels of