Nigeria to build economy on foundation of youth and diversity

The most populous country in Africa and blessed with abundant natural resources, Nigeria is the continent’s largest economy by GDP. Combining oil and gas wealth with the entrepreneurial efforts of its predominantly young population, Nigeria has developed a business-friendly environment over two decades of civilian rule and in the nearly 60 years since independence. These achievements are all the more impressive given the stresses and strains imposed on this vast country by regional, religious and political tensions. Yet the challenges of economic inclusivity and ensuring wider equality remain, as around one-half of Nigerians continue to live below the income poverty line.

However, Africa’s economic powerhouse has many strings to its bow, with its diversity and resilience also constituting sound foundations for further economic growth and political stability. The country has become a key nation in the wider continent, as well as beyond, and is increasingly making its presence felt in international assemblies and events.

Geography

Covering 923,768 sq km – or the area of France and Italy combined – Nigeria borders four other countries, a sea and a giant lake. The Niger River runs through the country from the north-west and is West Africa’s principal waterway. This joins the Benue River, flowing in from the east, at Lokoja in central Nigeria, eventually fanning out into the Bight of Benin and the Gulf of Guinea through one of the world’s largest deltas. These rivers form two major valleys, with a large expanse of plains and plateau to the north, up to the borders with Niger and Chad – at the lake of the same name.

To the south of the country, mountain ranges emerge through tropical forest, with the Benue hills running east to the border with Cameroon, while highlands stretch west to Benin. The capital Abuja was built in the 1980s and has an estimated population of 3.6m, according to the National Bureau of Statistics (NBS). It is situated to the north of the two main rivers, and is around 540 km north-east of Lagos, Nigeria’s maritime and commercial centre and largest city. The capital of Rivers State, Port Harcourt, a linchpin of the energy sector, sits on the Bonny River, approximately 470 km south of Abuja.

Climate

Nigeria has four distinct climate zones, with two seasons: rainy and dry. In the south, however, these two are not so distinct, with a tropical monsoon climate. The South Atlantic brings warm and humid weather to coastal areas, with temperatures in the low 30°C range most of the year. Inland, the wet season runs from April to October and the dry season from November to March. The high rains of the coast bring around 180-430 cm per year, moving from east to west and petering out inland.

The north of the country is largely savannah and sparsely vegetated, experiencing a dry desert harmattan wind from the north-east. Indeed, the north is largely savannah country, south of the deserts of northern Africa and sparsely vegetated. Travelling south the terrain shifts to rainforests and then develops into swamp forest along the coast.

History

While archaeologists have uncovered evidence of human settlements dating back over 2000 years, historical records largely begin in the 11th century with the creation of a number of city states on the coast. In the north, society was orientated towards North Africa and western Sudan due to its trade routes and cultural affinities. Islam was thus well established in the north by the 15th century, with Kano an important centre.

Around this time the Portuguese arrived on the coast, beginning a rivalry for control of trade between European powers, along with the development of the slave trade to the Americas. In the 19th century, a sheikh, Uthman dan Fodio, established ethnic Fulani rule over much of the northern territory. Britain abolished the slave trade in 1807 and, after discovering the mouth of the Niger River in 1830, began increasing its influence over the coast. In 1861 the island of Lagos was annexed from its Yoruba rulers, with a push inland resulting in the Niger Coast Protectorate in 1894 and, following a military expedition, the Protectorate of Northern Nigeria in 1900. In 1914 all the British possessions were then amalgamated into the Colony and Protectorate of Nigeria. Pressure for independence grew, particularly after the Second World War, in which many Nigerians fought for the British in Europe, North Africa and East Asia.

In 1954 a federal constitution was established, with self governance rolled out region-by-region over the following years. On October 1, 1960 this process culminated in full independence and a process of decolonisation, beginning with the confederation of northern, western and eastern districts.

Post-independence

On October 1, 1963 Nigeria declared itself a federal republic and Nnamdi Azikiwe, a key figure in the independence movement, became Nigeria’s first president. However, by then the country had entered a period of relative instability, and although the military was taking a bigger role in politics, it was itself riven between northern, eastern and southern factions. Coups and counter-coups in 1966 led to the dissolution of the legislature, the start of military rule and the accession to power of General Yakubu Gowon.

The country also endured a secessionist war between July 1967 and January 1970, when the Eastern Region declared itself the Independent Republic of Biafra, climaxing in a violently suppressed conflict. In part as a result of this, a series of constitutional amendments between 1966 and 1999 expanded the number of federal states from three to the current 36. Gowon was then overthrown in a military coup in July 1975 led by Brigadier Murtala Ramat Muhammed, who was assassinated a year later. His former chief of staff, Olusegun Obasanjo, replaced him, heralding a brief period of reform. Elections took place in 1979 and 1983, with Alhaji Shehu Shagari becoming president on both occasions, only to be ousted by another military coup in 1983.

A coup in 1985, as a result of more instability, brought Major General Ibrahim Badamasi Babangida to power. His rule was marked by a period of clashes between Muslim and Christians in 1991 and 1992. Elections held between parties sanctioned by Babangida led to further repression, resulting in his resignation in 1993. General Sani Abacha became the new military ruler, with opposition coalescing around Chief Abiola. In 1998 both died from heart attacks. Abacha’s successor, General Abdoulsalami Abubakar, led a return to civilian rule, with elections held in 1999 and Obasanjo returning to win the presidency. Since then, under the Fourth Republic, Nigeria has continued under civilian rule.

Language & Culture

Nigeria is ethnically diverse, with over 250 different ethnic groups and 300 different languages. While English serves as the official language, 40% of the population in the north speak Hausa. In the south, Yoruba is more commonly used, and in the east, Igbo. Other important languages include Fulfulde, Kanuri, Ijaw and Ibibio.

These linguistic divisions reflect the country’s main ethnic groups, with four of these being predominately represented. The Hausa and Fulani, largely in the north, account for some 28% of the population, while the Yoruba, in the south-west, make up roughly 21%. The fourth-largest group is the Igbo, representing around 18% of the population, and mainly in the south-east of the country. Other groups include the Kanuri, Ibibio and Tiv.

Religion

These ethnicities and linguistic groups are also reflected in religious affiliation. The Hausa and Fulani are predominantly Muslim, while the Yoruba and Igbo are largely Christian. There are, however, significant numbers of Muslim Yoruba, along with those who practise traditional native beliefs. Traditional practices are also evident in both Christian and Muslim worship in Nigeria. The vast majority of Nigeria’s Muslims are Sunni, with the largest Christian denomination being Catholicism.

Population & Demographics

Following independence, when the population was estimated at around 45.2m, there was a major population boom, and at the last full census in 2012 the figure stood at around 166.2m. By 2016 the NBS put the total at 193.4m, with the most heavily populated states being Kano, with 13.1m, Lagos (12.5m), Oyo (7.84m), Katsina (7.83m) and Rivers (7.3m). Lagos is set to become one of the world’s largest metropolises. By 2100 it is projected to have an urban area with some 88.3m people, with forecast models ranging between 61m and 100m, according to a September 2016 article, “Population predictions for the world’s largest cities in the 21st century”, published by the University of Ontario Institute of Technology.

The overall profile of the country is a youthful one: some 60% of citizens are under 25 years of age; an additional 15% are between 25 and 29; while 16% are under the age of four, signalling that the population is likely to keep expanding at a fast rate for some time to come, set to reach 300m by 2030 and 400m by 2050 (see Health & Education chapter). Still, the life expectancy for Nigerians, according to the UN Development Programme, remains low at 52.9 years. Since 1969, when gender parity was 50/50, the female population has fell to an historical low of 49.3% in 2017, according to the World Bank. The total fertility rate, measured in births per woman, dropped from 6.16 in 1998 to 5.53 in 2016.

Natural Resources

Nigeria has some of the largest proved oil reserves in Africa, totalling some 37.5bn barrels at the end of 2017, a figure unchanged from the previous year (see Energy chapter). With an oil reserves-to-production ratio of 51.6 years, Nigeria is not expected to run out of the resource until 2070. It has been a member of the Organisation of the Petroleum Exporting Countries (OPEC) bloc since 1971 with the production of Bonny Light, a light sweet crude contributing to the OPEC basket price. Nigeria has been Africa’s largest oil producer for more than a decade, adding 1.99m barrels to the world market in 2017, a 4.5% increase from 2016, according to the June 2018 “BP Statistical Review of World Energy”. Since 2010, however, production has fallen 21.5%, despite consistently making up around one-quarter of Africa’s total production. Proved natural gas reserves at the end of 2017 totalled 183.7trn standard cu feet, the largest in Africa.

The mining sector includes deposits of tin, iron ore, clay, shale and topaz. In addition, the country is home to a rich agricultural sector, with major exports including rubber, cocoa, peanuts and palm oil. Tropical woods and fisheries are also major employers and revenue earners.

Economy

Nigeria saw double-digit GDP growth during the first decade of the 21st century, peaking at 14.6% in 2002 and closing out the decade with 11.3% growth in 2010. The country’s GDP in 2018 was estimated at $397.5bn, an increase from $376.4bn in 2017, outstripping the continent’s other economic giant, South Africa, for the seventh consecutive year (see Economy chapter). However, GDP has declined since 2014 as global oil and gas prices have remained relatively low, despite a slight uptick in 2018. After a 1.6% retraction of GDP growth in 2016, a return to positive territory of 0.8% followed in 2017, with GDP growth estimated in 2018 at 1.9%, according to the IMF’s “World Economic Outlook”, published in October 2018. Further increases in GDP growth are forecast for the subsequent five years between 2019 and 2023, when GDP growth is expected to be 2.3%, 2.5%, 2.6%, 2.4% and 2.4%, respectively.

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Cover of The Report: Nigeria 2019

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This article is from the Country Profile chapter of The Report: Nigeria 2019. Explore other chapters from this report.