Nigeria’s economy has been heavily dependent on the oil sector since the early 1970s. After the price boom for crude oil in 1973 Nigeria took many prestigious large-scale projects (construction of the new capital Abuja, Building factories, roads and ports) and attracted workers from neighboring countries. Falling world market prices for crude oil and falling demand, but above all mismanagement, corruption and the extreme self-enrichment of political elites and the military have since then led to the impoverishment of OPEC member Nigeria. Reforms of the IMF (since 1986), debt rescheduling and a brief oil boom as a result of the Gulf War only brought about a temporary economic recovery in the early 1990s. In 1999, according to Cheeroutdoor, Nigeria again had to accept an IMF restructuring package consisting of privatization, market liberalization and the fight against corruption. In return, the country was granted US $ 18 billion in debt relief in 2006. Since then, the gross domestic product recorded (GDP) Growth rates between 4.3 and 8.4%, but slipped again into recession in 2016 (-1.6%), from which it was able to free itself again in 2018 thanks to the rise in oil prices and achieved economic growth of 1.9%. Foreign corporations and social elites continue to benefit primarily from the oil revenues. The majority of the population continues to live in poverty from subsistence farming and activities in the informal sector.
Despite the economic concentration on oil, Nigeria is a country with a strong agricultural character (share of agriculture in GDP 2017: 20.8%). Agriculture was neglected during the oil boom, so that Nigeria – once an exporter itself – became dependent on food imports. By improving cultivation and liberalizing agricultural production and marketing, agriculture is to be revived as a source of foreign currency and the dependence on agricultural imports reduced. Over three quarters of the total area of Nigeria is used for agriculture as arable or pasture land. With the exception of a few plantations (some of which are foreign-owned), cultivation takes place on small-scale farms. The most important crops for personal use and the local markets are yams, cassava, rice and sorghum. Typical plantation plants are oil palms, cocoa and peanuts. The export fruits are mainly grown in the southern parts of the country. Cattle farming is concentrated in the northern savannah areas that are free from the tsetse fly.
Forestry: After massive deforestation, only less than a tenth of the country’s area (mainly in the south) is designated as forest. Only a small part of the cut wood is processed as timber (mahogany, iroko, sapelli); the majority is used as firewood.
Fisheries: In addition to deep-sea fishing, coastal fishing and production in fish farms are important as a source of food, but not as an economic factor in foreign trade.
Nigeria has a number of valuable mineral resources such as hard coal, bauxite, tin, columbite, iron, lead, zinc and tungsten. By far the most important raw materials, however, are crude oil and natural gas. The production areas are mainly in the Niger Delta and the offshore shelf. The search for crude oil began in 1937 and production began in 1958. Nigerian crude oil is of particularly high quality and is therefore in international demand. The state has a majority share in all funding companies. Nigeria is one of the largest oil-producing countries in Africa (secured reserves in 2017: 5.1 billion t) and one of the most important natural gas producers (reserves: 5.2 billion m 3). However, the pollution of the air, soil and water associated with oil production leads to a severe impairment of the livelihoods of the population. The approximately 500,000 Ogoni who are based near the oil metropolis of Port Harcourt in the Niger Delta are particularly affected.
As a result of the oil boom, a wave of start-ups began in the manufacturing sector in the 1970s. The most important industrial locations are Lagos, Kano and Kaduna. In addition to the traditional branches such as the food and textile industries, Steel and cement works, oil refineries, a natural gas liquefaction plant, chemical (mainly fertilizer production) and pharmaceutical plants as well as assembly plants for motor vehicles. The industry is struggling with the problems of low profitability in large projects, high production costs and low skilled labor. Many products for everyday use are made in small craft and family businesses.
The service sector is still comparatively underdeveloped. In addition to trade, administration, health and education, it also includes numerous small repair shops and domestic services. Telecommunications and the banking sector are experiencing above-average growth.
Tourism: Compared to other African countries, Nigeria’s tourist attraction is low, also due to the precarious security situation. In addition to the national parks, the national museum and other cultural institutions in Lagos as well as the old town of Kano, the cultural center of the Hausa, are the main travel destinations.
Compared to most other West African countries, Nigeria has a well-developed transport system. The railway network mainly consists of the south-north connections Lagos – Kaduna – Nguru and Port Harcourt – Maiduguri, which are connected by the Kaduna – Kafanchan line. The main load of long-distance traffic, however, is handled on the roads. The connections between Lagos and Ibadan and between Kano and Abuja are multi-lane. 8 600 km of waterways are available for inland navigation, mainly the Niger with the Niger Delta, the Benue and the lagoons along the coast. Most of the foreign trade is carried out via the ports of Lagos, Port Harcourt and Warri. The largest oil terminals include Escravos and Bonny. Great efforts are being made to expand the pipeline network.