By Susan Njanji (AFP) – 2 days ago

LAGOS — Nigeria's Acting President Goodluck Jonathan put the finishing touches Thursday to a new cabinet tasked with tackling a mounting set of crises, including a new bout of sectarian slaughter.

A day after he dissolved the entire cabinet in a startling show of strength, Jonathan planned to unveil an invigorated ministerial team which have to address a daunting in-tray of problems.

Jonathan's spokesman Ima Niboro said the cabinet overhaul was designed "to inject fresh blood and bring even greater vigour to governance".

"It is part of a larger strategy to frontally confront the core challenges that face the nation at this critical moment of our history," added Niboro, quoted in the newspaper ThisDay.

Many analysts say that Nigeria, Africa's most populous nation and one of the world's biggest oil exporters, has been in a state of virtual governmental paralysis since President Umaru Yar'Adua was stricken by a heart condition last November.

Although the president did return home to Nigeria last month after a three-month stay in a Saudi hospital, he has yet to be seen in public -- let alone return to work.

In his absence, Nigeria has been rocked by renewed unrest in the oil-producing Niger Delta region, where rebels staged a double bomb attack earlier this week, and large-scale killings of Christian villagers.

Only 10 days after machete-wielding Muslim herdsmen slaughtered at least 109 villagers near the flashpoint city of Jos, another dozen people were butchered early Wednesday.

The economy is also in trouble with Nigeria's foreign reserves falling last month by 510 million dollars as inflation edged up to 12.3 percent.

And earlier this month, former oil minister Rilwanu Lukman warned that losses and liabilities totalling more than 2.5 billion dollars are pushing Nigeria's giant state oil firm NNPC towards extinction.

Investors are keeping a close eye and looking for political backing for reforms.

"Reassurances will be sought that some kind of predictability can be reinstated quickly, and all-importantly, that the move will not trigger an escalation of political risk," said London-based Razia Khan, chief researcher on Africa for Standard Chartered Bank.

Time is not on Jonathan's side and sources in the presidency say the installation of the new government will be fast-tracked, with at least half of the old 42-strong cabinet re-instated.

A presidential source said that Jonathan had already held talks with parliamentary leaders in a bid to speed up the new team's installation.

He "is in talks already with the leadership of the senate so that it can expedite the clearance of the nominees," said the source.

He is unlikely to face opposition as the Senate overrode the reservations of Yar'Adua's ministers to vote him into office as acting head of state.

Jonathan's decision to dissolve the cabinet now gives him an opportunity to appoint his own team and thus strengthen his authority.

The opposition Action Congress said the sacked cabinet "failed when it mattered most: when a courageous act was needed to break a logjam that rattled Nigeria to its very foundation and threatened its fledgling democracy".

"It was the ministers? lack of courage, flimsy loyalty and downright selfishness that eventually left the (cabinet) divided, thus paving the way for it to fall like a pack of cards," said AC.

The outgoing information minister Dora Akunyili, a supporter of Jonathan who is tipped to return to cabinet, said the government clean-out was needed.

"Even with the ongoing political tension in Nigeria the dissolution of the cabinet is probably in the best interest of the country," she said.

Observers said Jonathan's sacking of the entire cabinet would be somewhat risky and could face legal challenges from some of the ministers in the dissolved cabinet, especially those aligned to Yar'Adua.

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