Friday, January 1, 1999 Published at 21:02 GMT
Oil prices threaten Nigerian economy
Nigerian living standards will be affected by the collapse of oil prices
The military government of Nigeria has unveiled a budget for 1999, warning that hard and painful decisions are necessary following the collapse of world oil prices.
The country's budget for 1998 was drawn up on the premise that a barrel of oil, of which about two million are produced every day, would sell for US$17. The budget for 1999 is calculated on an oil price of barely US$9.
He said the country would have to cut back on its debt repayments and could no longer afford to repay the minimum wage for civil servants, a reform introduced in September.
But in a move that will impress Western donors and international institutions, General Abubakar has announced the immediate abolition of the dual exchange rate.
Under this system, certain privileged groups were allowed access to foreign exchange at a rate about four times cheaper than the general public.
As he admitted, this will remove a long-standing opportunity for personal gain at the expense of the public purse.
The BBC correspondent in Nigeria says that while the new moves show a willingness to tackle corruption, the public will be more concerned by the inevitability of falling living standards.