21.07.2007 - Source: BBC News

Reasons to be cheerful over the impact of debt relief on Nigeria ("Optimism on Nigeria's war on poverty") [ID 20964]

Document(s): Open document

06.2007 - Source: Freedom House

Majority engaged in small-scale agriculture, which deteriorated considerably in the pursuit of oil ("Freedom in the World 2007") [ID 20554]

"The majority of Nigerians are engaged in small-scale agriculture, and most wealth is controlled by a small elite. The agriculture and manufacturing sectors have deteriorated considerably in the pursuit of oil, which accounts for more than 98 percent of the country’s export revenues and almost all foreign investment."

Document(s): Open document

24.05.2007 - Source: International Committee of the Red Cross

A substantial part of the country's external debt was written off by the Paris Club, the government is still unable to deliver on essential services for the people ("Annual Report 2006") [ID 20843]

"A deal between the Nigerian government and the Paris Club of public creditors saw a substantial part of the country’s external debt written off, making it possible for the West African nation to clear the remaining debt using reserves from oil sales. Frustration over the government’s inability to deliver on basic issues and essential services such as security, health care, education, housing and utilities continued to fuel tension and internal violence."

Document(s): Open document

09.2006 - Source: Freedom House

Economic reforms wrote off $18 billion in debt ("Freedom in the World 2006") [ID 18140]

"The Obasanjo government in 2005 continued its economic reform efforts and won praise from international creditors for attempts to fight corruption. In 2005, the International Monetary Fund said that for the first time in decades Nigeria's non-oil sectors were growing significantly faster than the oil sectors and that this had reestablished confidence in the country as a foreign investment location. The Paris Club of creditor nations announced that it was impressed by Nigeria's economic reform program and wrote off $18 billion in debt; Nigeria has a $30 billion foreign debt."

Document(s): Open document

09.2006 - Source: Freedom House

Majority of Nigerians engaged in small-scale agriculture; oil sector accounts for 98 percent of export revenues ("Freedom in the World 2006") [ID 18143]

"The majority of Nigerians are engaged in small-scale agriculture, while most wealth is controlled by a small elite. The agriculture and manufacturing sectors deteriorated considerably in the pursuit of oil, which accounts for more than 98 percent of the country's export revenues and almost all foreign investment."

Document(s): Open document

04.2005 - Source: UK Border Agency (Home Office)

Vast but largely unfulfilled economic potential; 314 $ annual income per head ("Country Report - April 2005") [#31982],  [ID 14819]

"3.1 The UK Foreign and Commonwealth Office (FCO) Country Profile on Nigeria, dated December 2004, states that Nigeria’s GDP is US$35.1 billion. The annual GDP growth rate in 2003 was 3.7 per cent. The national currency is the Naira. The FCO Country Profile further states that, “As the most populous African nation and the leading sub-Saharan oil producer, (2.3 million barrels of oil per day), Nigeria has a vast but largely unfulfilled economic potential. As a result annual income per head in Nigeria is amongst the lowest in the world at $314, and two thirds of the population live on less than a dollar per day.” [2] (page 3)."

Document(s): Open document

10.2003 - Source: UK Border Agency (Home Office)

Nigeria is a highly indebted country ("Country Report - October 2003") [#17332],  [ID 14820]

"3.2 Driven by rising oil prices and high levels of government spending, growth in real GDP grew by 3.89% in 2001, up from 3.83% in 2000. However, poor budgetary controls and inadequate monetary management contributed to rising inflation that reached an estimated 21.8% by March 2002. Inflation had led to an unsustainable disparity between the official and parallel exchange rate for the currency, the Naira. The poor economic performance has also reflected fundamental structural problems in the Nigerian economy. The key factors include corruption, the poor state of infrastructure, especially in the power sector, and the independence of state governments, which has made implementation of national economic policy difficult. These problems have prevented diversification of the economy from the hydrocarbon sector. One area of relative success in structural reform has been the privatisation programme. However the timetable suffered a significant set back with the collapse in early 2002 of the flagship sale of the national telecom carrier NITEL.



3.3 Nigeria is a highly indebted country owing approximately $28bn to external creditors. The overwhelming majority of this debt ($22bn) is owed to official bilateral creditors, other governments, which are members of the Paris Club. The United Kingdom is by far the largest official creditor, being owed approximately $6 billion. The remainder is owed in roughly equal amounts to private creditors and multilateral institutions (the World Bank and African Development Bank). Nigeria and the Internal Monetary Fund (IMF) approved a one-year Standby Arrangement on 4 August 2000, however, this lapsed by mutual consent in October 2001 due to inadequate performance on some of the major areas for economic reform. In March 2002, Nigeria and the IMF agreed they would not pursue a further formal programme until after the presidential election in 2003. Nigeria cannot come to the Paris Club of official creditors for a programme of debt rescheduling or relief until such time as an IMF programme is in place and a satisfactory track record of reform is established. For further information on geography and the economy, refer to Europa yearbook source."

Document(s): Open document

09.12.2002 -

CIA World Factbook 2002: Substantial economic reform under the new civilian administration ("CIA World Factbook 2002: Country Profile Nigeria") [ID 14821]

"The oil-rich Nigerian economy, long hobbled by political instability, corruption, and poor macroeconomic management, is undergoing substantial economic reform under the new civilian administration. Nigeria's former military rulers failed to diversify the economy away from overdependence on the capital-intensive oil sector, which provides 20% of GDP, 95% of foreign exchange earnings, and about 65% of budgetary revenues. The largely subsistence agricultural sector has failed to keep up with rapid population growth, and Nigeria, once a large net exporter of food, now must import food. Following the signing of an IMF stand-by agreement in August 2000, Nigeria received a debt-restructuring deal from the Paris Club and a $1 billion loan from the IMF, both contingent on economic reforms. Increases in foreign investment and oil production combined with high world oil prices should push growth over 4% in 2001-02."

Document(s): CIA World Factbook 2002: Country Profile Nigeria

01.2002 -

Human Rights Watch: As measured by per capita income Nigeria is one of the poorest countries in the world ("01/1999 - HRW: The Price of Oil") [ID 14823]

"Nigeria is the largest oil producer in Africa, and the fifth largest in the Organization of Petroleum Exporting Countries (OPEC). The discovery of oil has transformed Nigeria’s political economy, and oil has for the past two decades provided approximately 90 percent of foreign exchange earnings, and 80 percent of federal revenue. Nigeria also has huge reserves of natural gas, yet to be fully exploited. Yet, instead of turning Nigeria into one of the most prosperous states on the African continent, these natural resources have enriched a small minority while the vast majority have become increasingly impoverished: with a per capita gross national product of only U.S.$260 a year, Nigeria is one of the poorest countries in the world. At the same time, the struggle among the elite to gain access to the profits of the oil boom has been a factor in the rule of successive military governments: since independence in 1960, Nigeria has enjoyed only ten years of civilian rule, though the current military regime has committed itself to leave office in May 1999. While minority ethnic groups in Nigeria’s multi-ethnic federation have successfully demanded that new states and local government units be carved out to fulfil their hopes of receiving some benefit from the oil money and to compensate for the damage done by oil production, the Nigerian federation has in practice, paradoxically, become ever more centralized and power and money has been concentrated in the hands of fewer and fewer people. Politics has become an exercise in organized corruption; a corruption perhaps most spectacularly demonstrated around the oil industry itself, where large commissions and percentage cuts of contracts have enabled individual soldiers and politicians to amass huge fortunes."

Document(s): 01/1999 - HRW: The Price of Oil

05.2001 -

Edlyne E. Anugwom : Analysis of fiscal policy, federalism and revenue allocation in the Niger-Delta ("05/2001 - Edlyne E. Anugwom: Federalism, Fiscal Centralism and the Realities of Democratisation in Nigeria: The Case of the Niger Delta") [ID 14824]

"The increase in demands for a more federal oriented fiscal policy in Nigeria may not be unconnected with the worsening economic situation and the growing inability of the people to meet the economic demands of existence as individuals or groups. Actually, it has been demonstrated that the adoption of structural adjustment in most African countries in the 1970s and 80s has led to a trend of resource wars or environmental conflicts (see, Obi, 1999; Adepoju, 1996). Thus, the recent trend of resource control agitations and even the ever running conflict between the oil firms and the groups in the Niger Delta of Nigeria points to the sprawling socio-economic problems in the area. This point actually runs through all the demands of the Niger Delta people.

Even the recent increase in the derivation component of revenue allocation to 13% by the federal government has not really assuaged the feeling of injustice among the minorities. This situation derives directly from the long years of neglect and environmental degradation caused by oil pollution. Of course it goes without saying that Nigeria’s mono-economy is built on oil and over 90% of this oil comes from the minority Niger Delta area. The efforts of previous governments to appease the region through the provision of infrastructure in the area through the defunct Oil Minerals Producing Areas Development Comission (OMPADEC) did not achieve much result. Recently, the government in addition to the 13% derivation allocation has established the Niger Delta Development Commission (NDDC) to take charge of improving the infrastructural outlook of the Niger Delta zone as a whole. However, it is still too early to assess the performance of this commission that just kicked off this year.
[...]
The derivation principle which ensures that a region benefits from the central pool according to its contribution was effectively utilised in Nigeria in the period of the commodity marketing boards when the country was dependent on such primary products as groundnut, cocoa and palm oil which were largely from the dominant or major ethnic groups for external revenue. The decline of these products and the emergence of oil has coincided and produced an ironic decline of the derivation principle of revenue allocation. It stands to reason, as the people of the Niger Delta are wont to argue, that if crude oil has been discovered in the major ethnic groups, the principle of derivation would still be in prominence. In other words, the major ethnic groups have used their dominance of state power in the country to unleash a fiscal policy that punishes rather than rewards the goose that lays the golden eggs.

The resurgence of the revenue agitation has gone even beyond the confines of the Niger Delta. Even the neighbouring South-Eastern states that produce some of the oil have added their voice to the fiscal federalism demand. The situation has not really been helped by the recent enthronement of the sharia law in most states in the North of the country. The sharia law which forbids such things as the consummation of alcohol and other types of hotel and entertainment related businesses has meant a decline in the contributions of these states to the national domestic revenue derived from the Value Added Tax (VAT). The VAT has in the last three years emerged as one of the most profitable sources of internal revenue for the government. The states and local governments are usually allocated a percentage of the revenue from this source by the federal government each fiscal year and this irrespective of the contribution of each tier of government to the VAT pool."

Document(s): 05/2001 - Edlyne E. Anugwom: Federalism, Fiscal Centralism and the Realities of Democratisation in Nigeria: The Case of the Niger Delta