UPDATE 1-World Bank MD eyed for Nigerian cabinet role
* Okonjo-Iweala respected former finance minister
* Nigeria faces tough economic reforms
* Ministerial list to be submitted to Senate soon (Adds additional names submitted for security clearance)
LAGOS, June 24 (Reuters) - Nigerian President Goodluck Jonathan is close to finalising his new cabinet, with World Bank managing director Ngozi Okonjo-Iweala being wooed for an expanded role in charge of the economy, sources said on Friday.
Jonathan was sworn in for his first full term almost a month ago and his ministerial choices are being closely watched by Nigerians and foreign investors keen for a team capable of driving much needed reforms in Africa's most populous nation.
He has spoken with Okonjo-Iweala, a respected former finance minister who helped negotiate debt relief in 2005, about returning to cabinet with additional broad powers over economic management, sources familiar with the negotiations said.
"We're facing some tough fiscal decisions such as (ending) petroleum subsidies, minimum wage issues. So the idea is to have a strong and robust economic management team," one source close to the presidency told Reuters.
"You need to bring in somebody who has been there before, who understands both the domestic and the international implications of these issues," the source said.
Security and government sources said Okonjo-Iweala met Jonathan during his trip to the United States this month and again in Abuja this week. There was no comment from the presidency, while Okonjo-Iweala could not be reached.
Okonjo-Iweala was praised as finance minister for fighting corruption and negotiating the cancellation of nearly two-thirds of Nigeria's $30 billion Paris Club debt. She was suddenly reassigned by then-President Olusegun Obasanjo to foreign minister in 2006, a move that was never properly explained.
She was appointed to the World Bank, where she had previously worked for more than two decades, in October 2007.
Her inclusion in the cabinet would bring credibility to Jonathan's reform ambitions but she is understood to want a role that would give her more autonomy and powers than the outgoing finance minister if she is to return to Nigerian politics.
"Mr President assured her she will be given a free hand to work," a second government source said, asking not to be named.
Negotiations were continuing, the sources said.
Jonathan is expected to submit his list of ministerial nominees to the Senate for approval in the coming days, with the screening process likely to begin when the upper house returns from recess on Tuesday.
The secret service - which vets the nominees - has so far approved 30 names, security sources said, and another batch of 12 were submitted by the president late on Friday, although not all of those cleared will necessarily make the cabinet.
Those already submitted to the secret service include outgoing oil minister Deziani Allison-Madueke and outgoing finance minister Olusegun Aganga, a senior security source said.
Okonjo-Iweala's name has yet to be submitted for clearance.
Aganga, a former Goldman Sachs executive, oversaw the establishment of a sovereign wealth fund signed into law by Jonathan last month. Some banking industry sources have said he could end up running that fund or take another role.
Jonathan won elections in April deemed to have been the most credible for decades but his path to the presidency was not an easy one and there is a list of regional and political factions who feel he owes them for his victory.
He had to convince powerful northern politicians in his own party to back him at the primaries and eschew a tacit agreement that power rotates between north and south every two terms, a deal which would have ruled out his candidacy.
Jonathan also faces national security challenges.
Rioting in the mostly Muslim north killed hundreds of people following his victory, while radical Islamist sect Boko Haram has stepped up a campaign of violence, detonating a bomb outside the national police headquarters last week.
His aides have said Jonathan will form an all-inclusive government, and lobbying for the final make-up of the cabinet is likely to continue to the eleventh hour.
"There is pressure on the president from all kinds of factions, including those who want more robust economic management. But there are also those who do not want that at all," the source close to the presidency said. (For more Reuters Africa coverage and to have your say on the top issues, visit: af.reuters.com/ ) (Additional reporting by Camillus Eboh and Felix Onuah in Abuja; Writing by Nick Tattersall, Editing by Alison Williams)
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