Oil Dependence Hindering Nigeria’s Emerging Economy

Nigeria Oil Production and Revenue
Nigeria Oil Production and Revenue

CEIC Macro Watch: The proceeds from Nigeria’s oil and gas industry comprised 38.77% of its nominal GDP and generated 76.26% of the country’s overall government revenues in the first quarter of 2013. However, Nigeria’s high dependence on its oil reserves could prove to be a losing strategy in its attempt to sustain long-term economic growth that has not fallen below 6% in the past twelve years. Volatile global oil prices, combined with the steep decline in industrial production growth in the Nigerian mining sector since September 2011, have resulted in diminishing oil revenues. At the core of the increasingly inefficient oil industry lie the political reluctance to renovate this sector, not to mention the frequent attacks on the pipelines and oil thefts. As of the first quarter of 2013, Nigeria’s gross federation account revenue from oil stood at NGN 1.85 trillion, a 30% dip from the third quarter of 2011. Though Nigeria is one of several rapidly-growing economies in Africa, international investors are still wary of the corruption and instabilities in the country. Development of the non-oil sectors, such as manufacturing and agriculture, may help to alleviate Nigeria’s reliance on the oil industry, ensure sustainable economic growth and attract investment. Discuss this post and many other topics in our LinkedIn Group (you must be a LinkedIn member to participate). Request a Free Trial Subscription. By Iveta Jordanova in Bulgaria - CEIC Analyst Back to Blog

3rd June 2013 Oil Dependence Hindering Nigeria’s Emerging Economy

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