Country overview and development profile: Nigeria

Nigeria: A Country Report

As a federal republic in West Africa, the country of Nigeria, formerly a British dependency, became an independent member of the Commonwealth of Nations in 1960. In 1961, Nigeria became part of the British Cameroons, a trust territory of the United Nations. In 1963, Nigeria adopted a republican constitution, yet it retained its membership in the Commonwealth.

By far the most populous country in Africa, the population estimates for Nigeria vary greatly; however, due to its vast natural resources, the country has managed to support an ever-expanding population. One of the most important events in Nigeria which has highly influenced its current economic state was the discovery of oil in 1959. In addition, traditional agriculturists in all regions of Nigeria have learned to use and exploit the nature of various soils through plant selection and by allowing a good portion of the land to remain unfarmed. Yet Nigeria's huge land expanses have allowed to support not only it own people but those in other African nations via exporting a great variety of foodstuffs.

Population:

Due to its wealth which was increased in the late 20th century, Nigeria was able to modernize itself much quicker than some its poorer neighbors. And as a result of this development, Nigeria has been forced to confront two important aspects, namely, population growth and shifts in its demographics. For the most part, population statistics for Nigeria are not very reliable. According to "A Country Study: Nigeria," with probably more than 100 million people in 1990, the precise figure is uncertain," due to the lack of a census since 1963. However, the population of Nigeria "is about twice the size of . . . The next largest country in Africa," being Egypt with an estimated 1989 population of 52 million " (2004, Internet). As to population densities, the number is greater than 400 inhabitants per kilometer, especially in "the southwest near Lagos and the rich agricultural regions around Enugu and Owerri. In the capital city of Lagos, it is estimated that in 1985, six million people lived and worked in this bustling, modern-day metropolis ("A Country Study: Nigeria," 2004, Internet).

Thus, it is abundantly clear that Nigeria's population is increasing at a very rapid rate. For example, in 1921, the estimated population was 18 million; in 1980, the estimate jumped to 75 million which indicates that the population increased fourfold in less than sixty years (Nelson, 1982, 156). The reasons for this huge increase are related to the improvements made by the British in the early part of the 20th century when they introduced public health measures, sewage disposal and the control of insect-born diseases.

GDP-Gross Domestic Product:

During the 1070's, Nigeria expected a continuation of its prosperous years, but the projected 8% annual increase in the GDP fell short. This was due in part to the decrease in the demand for petroleum which greatly affected its economy. By 1981, Nigeria's imports exceeded its exports, and between 1979 and 1983, Nigeria's foreign exchange buffer decreased from $3.5 billion to $1.2 billion. Although the downturn in petroleum production was stopped in 1983 and output began to exceed the official OPEC rate of 1.3 million barrels a day, oil production in Nigeria was still only about two-thirds as compared to the late 1970's (Folayan, 1983, 178).

Domestically, Nigeria's GDP (2003 estimates) were as follows -- purchasing power parity, $114.8 billion; real growth rate, 7.1%; GDP per capita income, $900; GDP composition by sector-agriculture, 30.8%, industry, 43.8% and services, 25.4%; investment (gross fixed), 27.7% of the GDP; population below the poverty line (2000), 60%; household income or consumption by percentage share, the lowest 10% @ 1.6%, the highest 10% @ 40.8% (1996-97); distribution of family income (GINI Index), 50.6 (1996-97), and the inflation rate (consumer prices) stood at 13.8% in 2003 ("Nigeria," 2005, Internet).

Additionally, Nigeria's export commodities are dominated by petroleum and petroleum products (95%), while cocoa and rubber make up the difference. Import commodities include machinery, chemicals, transport equipment, manufactured goods, food and live animals ("Nigeria," 2005, Internet).

Nigerian Economy-Agriculture Sector:

In Nigeria, the GDP "originating in the agricultural sector, shrank from 65.7% in FY 1959 to 30.9% by 1976," but by 1988, "39.1% of GDP was derived from agricultural activity," as of June of 1991. Also, the contributions from the agricultural sector "increased 3.8% yearly between 1983 and 1988 and the percentage of export value in agriculture grew from 3% in 1983 to 9% in 1988" ("Nigeria," 2005, Internet).

In 1960, Nigeria depended on the exports of three major products, being peanuts and peanut oil which accounted for almost 20% of the total in exports; cocoa at about 13% and palm-oil products at about 15%. After 1976, few peanuts were exported and today, this crop is processed for use in Nigeria; the palm-oil trade was affected by the Biafran War between 1967 and 1970 and never fully recovered. Only cocoa, the major export of western Nigeria, has remained a valued commodity in foreign export trade. Unfortunately, the agricultural sector within Nigeria "has failed to keep up with rapid population growth," for the country must now import a good percentage of its food despite the huge lands available for farming ("Nigeria," 2005, Internet). However, Nigeria processes a good amount of its own food, an important factor for such a growing and expanding population as found in Nigeria.

Manufacturing Sector:

Nigeria's manufacturing sector was greatly stimulated by the income derived from petroleum and presently accounts for more than 10% of its gross domestic product. The Nigerian government has for sometime now refrained from attempting to dominate the industrial sector except when it comes to rules and regulations for the development of specific and important products. When Nigeria began its manufacturing sector, it made numerous deals with suppliers of steel in order to build plants; by the mid-1960's, these plants were manufacturing cement and building products, and by the 1970's this expanded into a huge operation which now supplies the country with most of its cement needs.

Also, the motor transport industry became extremely important, due to the fact that most of the country's internal trade is transported by truck, not to mention providing transportation for the populace within and outside of Lagos and to the vast regions that make up most of Nigeria's landmass. Also, the transport industry quickly learned that Nigeria's economy could greatly benefit from automobile plants; today, several foreign automobile manufactures have assembly plants in Nigeria which build automobiles for the general public and for commercial use (Nelson, 1982, 178).

Services Sector:

In Nigeria, most electric power for its industries and cities is provided by thermal and hydroelectric plants. Today, most of the electric power is the result of the Kainji Dam over the Niger River, completed in 1975. The generating stations at this location possess a capacity for generating nine hundred and sixty megawatts, more than half than what had been allocated in the 1980's. However, Nigeria has faced some rather crucial problems connected with its electrical system, for its delivery lines cannot hold the required capacity which has resulted in major power outages and blackouts in some of the major cities.