Structural Adjustment Programme and the Nigerian Economy: the Gains and Losses

In Nigeria, the issue of mismanagement and underutilization which led to huge wastage of resources and manpower potentials gave the government of the day no other option but to pursue quickly the privatization and commercialization program. They are about six hundred (600) public enterprises in Nigeria, ran by or controlled by the federal government, many are controlled by the state government. These companies take a sizable portion of the federal budget and account for over 5000 patronage. Transfers into these enterprises ran into billions on Naira. These transfers were in form of subsidized foreign exchange import duty waves, tax exemptions and/or write off of unrequited revenues, loans and guarantees and grants/subventions. These companies

Nigeria, located in West Africa, is a densely populated nation of over 100 million people. Since the nation’s independence from Britain in 1960, the country has been in the hands of various leaders ranging from religious to staunchly militant. Nigeria is the sixth largest producer of crude oil in the world and it has one of the largest deposits of natural gas (Wiwa, 2001). Oil accounts for ninety five percent of Nigeria’s foreign exchange earning and one-fourth of the country’s Gross Domestic Product comes from oil. A large percentage of this oil is located in the Niger Delta.

Oil for over a decade has been the main source of income for the Nigerian economy. It accounts for more than 70% of export.The Niger Delta region of Nigeria has been plagued with different negative effects of oil exploration. The environment, economy and even quality of human life have been greatly affected. This has created a lack of trust between the inhabitants and the oil companies, and even with the Nigerian government.

Nigeria has a population of around 180 million, making it the most populous country in Africa. Nigeria is located in a region with tropical climate and that can grow variety of crops. With their numerous resources and growing technology they have been able to have positive economic advancement. Nigeria has had improvements in five of the ten economic freedoms. This includes Freedom of corruption, labor freedom, and management of government spending ("Nigeria." Economy: Population, GDP, Inflation, Business, Trade, FDI, Corruption.). Nevertheless these large improvements in their economy has not brought human development, where most Nigerians live under the poverty line. This paper will focus on why Nigeria has not been able to use their economic prosperity in the sector of human development, this includes standard of living, health, safety, and basic necessity one needs to live a stable life. We will compare it to the state of Ghana whose economy has also flourished but has been success in human development.

Nigeria is an Agricultural and oil rich nation but characterised by Political instability, corruption, poor

“Nigeria is currently the largest oil producer in Africa and was the world 's fourth-largest exporter of LNG in 2015. Nigeria 's oil production is hampered by instability and supply disruptions, while its natural gas sector is restricted by the lack of infrastructure to commercialize natural gas that is currently flared (burned off).” (British Petroleum, 2016) Nigeria is a member of OPEC. Although Nigeria is the largest oil producer in Africa, its production is affected by unplanned outages; some that have been estimated to have been up to 500,000 BPD. (U.S. Energy Information Administration, 2016) Nigeria’s petroleum industry is impacted by regulatory uncertainty, corruption, mismanagement of oil subsidies, oil theft, sabotage, environmental damages, and piracy in offshore West Africa.

Oil production in Nigeria’s Niger Delta began in 1956. Ever since then, the Delta communities have recognized unrest as oil was being distributed in profitable quantities. Oil has been Nigeria’s leading export product for more than six decades. Even though, oil has given Nigeria a tremendous economic boost, nearly sixty percent of that oil production has been carried out under Shell’s regulation, and during these past six decades, there has been enormous environmental degradation because of frequent oil spills and gas flaring. This has led to a polluted fish ponds and declining growth of crops in Niger communities. Shell has personally financed Nigerian militants to insure the production of oil, and this has led to brutal murders and illegal executions of community members who tried to protest the damages that shell was creating to their environment. So why and how is Shell still operating and still committing human right crimes in Nigeria? This paper will explain why Shell has dominated Nigeria since the 1950s, how the company has damaged the lives of numerous communities, insured the production of oil to this day through militant use, and still managed to separate themselves from the many years of violence that they founded.

The diversity of the country’s export base has been eroded by focus on hydrocarbon activities, however limited growth in the non-oil sector has helped diversify the economy during the past decade. Agriculture remains relevant as main source of employment. In the 1990’s, uncontrolled debt levels, debt restructuring, failure to meet payment deadlines and write-offs damaged Nigeria’s a reputation. Nigeria returned to civilian rule in 1999, after independence from Great Britain in 1960 was followed by years of military rule. (Nigerian Government, 2015).

Privatization basically being the process of transferring ownership of specific property and business transactions basically from a governed owned operation to a private operation. This focus has been widely used in the context of the organizations and industrial operations in the capital market. (Cook & Kirkpatrick, 1988, Cook Paul, 1986; Kay & Thompson, 1986)

Agricultural production, which used to be the mainstay of Nigerian economy, has been declining as results of crude oil discovery and subsequent increase in production and exportation of crude oil (Edo (2013). The discovery of crude oil and appreciation of oil price in the World market some years ago leads Nigerian government to abandon all other means of revenue generations, including agriculture, just to depend solely on crude oil revenue to finance most of her budgets. However, crude oil exports are no longer sustaining the economy due to the current downturn in crude oil price. For instance, the Nigerian government generated lots of revenues from crude oil exports, but majority of her populations are still under the poverty

Nigeria obtained their independence from Britain on 1st October 1960. Within the country of Nigeria, they have over 371 tribes, but the main three that is well known are, Igbo, Hausa, and Yoruba. Within those 371 tribes, they have 521 languages. Nigeria is well known for their petroleum, and they have other natural resources include tin, iron ore, coal, limestone, niobium, lead, zinc and arable land. The maximum crude oil production capacity of Nigeria is 2.5 million barrels per day, and the whole world consumes an average of about 19.4 million barrels per day. One might ask, what is the problem with a country with the maximum capacity of oil production at 2.5 million a day? The problem with the country of Nigeria, according to my research, shows that its people are living in poverty. The country does have people who are blessed with money, but it also has people who cannot afford anything to eat for a day. According to the Food Aid International organization (FAI), “3000 adults and children die every day of hunger and poverty,” (Xinhua).“BBC news.” Another statistic from, “UNICEF, ORG,” illustrates, “About 70.8 percent of the population lives on less than $1 a day, and 92.4 percent lives on less than $2 day.” My research shows that the contributing factor of these massive poverty among citizen is caused by, unemployment, high inflation rate, high-interest rate, poor economic planning, high taxation, policy conflict, and corruption. But my study focuses on the leading factor

Nigerian National Petroleum Company is mainly responsible for the context of firm strategy and rivalry of the oil industry in Nigeria. The increase in the oil reserves and gas utilization is also achievable due to the introduction of various incentives by the government which includes a Memorandum of Understanding that will guarantee a profit margin of 2 US dollar per barrel. This had allowed an increase in

The effect of these liberalizations on the economy is of high importance in research advances in the recent years. The second section focuses

The methodology will be carried out using secondary data mainly from the Central Bank of Nigeria (CBN) Statistical bulletin, the National Bureau of Statistics (NBS), the Nigerian National Petroleum Corporation (NNPC) and a few from the CIA World Fact Book, World Development indicators (WDI) and, Organisation of Petroleum Exporting Countries (OPEC) for the period of 1980-2013. The variables to be used include; Gross Domestic Product growth (GDP Growth), Domestic Crude Consumption, Crude Export, Manufacturing Growth, Domestic Savings, Export Growth, Foreign Direct Investment (FDI) Net Inflows and Agricultural Growth. They will be assessed in two sets with different dependent and explanatory variables:

Nigeria is Africa’s leading producer of oil and the seventh largest producer of crude oil in the world, and equally endowed with other numerous natural resources. But rather than utilizing its resources for maximum development, the country is unfortunately bedevilled with how to efficiently and effectively distribute oil revenues in an equitable manner. The revenue allocation phenomenon in Nigeria is basically the issue of distribution of national (resources) revenue, mobilized by the central federal government. And as far as the revenue allocation debacle is concerned, the haggling is between those who bake the national cake (major contributors to national revenue) and those at the helm of affairs to allocate it. There