According to mundi, “facts and statistics about the economy-overview of Nigeria updated as of 2013” oil-rich Nigeria has been hobbled by political instability, corruption, inadequate infrastructure and poor macro-economic management but in 2008 began pursuing economic reforms. Nigerians former military rules failed to diversify the economy away from its over dependence on the capital-intensive oil sector, which provides 95% of foreign exchange earnings and about 80% of budgetary revenues.
Following the signing of an IMF stand-by agreement in August 2000, Nigeria received a debt-restructuring deal from the Paris Club and a $1billion credit from the IMF, both contingents on economic reforms. Nigerian pulled out of its IMF program in April 2002, after failing to meet spending and exchange rate targets, making it ineligible for additional debt forgiveness from the Paris club. In November 2005, Abuja won Paris club approval for a debt-relief deal that eliminated $ 18 billion of debt in exchange for $ 12 billion of payments a total package worth $ 30 billion of Nigeria’s total $37 billion external debt.
Since 2008 the government has begun to show the political will to implement the market-oriented reforms urged by the IMF, such as modernizing the banking system, removing subsidies, and resolving regional disputes over the distribution of earning from the oil industry. GDP rose strongly in 2007-2011 because of growth in non- oil sectors and rebuts global crude prices. President Jonathan has established an economic team that includes experienced and reputable members and has announced plans to increase transparency, diversity, economic growth and improve fiscal management. Lack of infrastructure and slow implementation of reforms are key impediments to growth and development. The government is working towards developing stronger public-private partnerships for roads, agriculture and power.
Nigeria’s financial sector was hurt by the global financial and economic crises, but the central bank governor has taken measures to restructure and strengthen the sector to include imposing mandatory higher minimum capital requirements.
The Nigerian economy slowed down from 7.4% growth in 2011 to 6.6% in 2012. The oil sector continues to drive the economy, with average growth of about 8.0%, compared to 0.35% for the non-oil sectors. Agriculture and the oil and gas sectors continue to dominate economic activities and Nigeria economy. The fiscal consolidation, stance of the government has helped to contain the fiscal deficit below 3.0% of gross domestic product (GDP).this coupled with the tight monetary policy stance of the Central Bank of Nigeria (CBN),helped to keep inflation at around 12.0% in 2012. The outlook for growth remains positive. Short and mid-term downside risks include security challenges arising from religious conflict in some states, cost associated with flooding, slower global economic growth (particularly in the united state and china) and the sovereign debt crisis in the euro area.
The economic growth has not translated into job creating or poverty alleviation. Unemployment increased from 21% in 2010 to 24% in 2011 because the sectors driving the economic growth are not high job-creating sectors (the oil and gas sector, for example, is a capital intensive “enclave’’ with very little employment – generating potential) the major policy issue is employment generation, particularly among the youth, and inclusive growth.
The economic growth was not accompanied by a structural change of the Nigerian economy. The economy lacks diversification, and agricultural production lacks modernization. To address this, the government is encouraging the diversification of the Nigerian economy away from the oil and gas sector. It is addressing the infrastructure deficits in the country and the development of the agricultural sector through modernization and the establishment of staple-crop processing zones, with the value chain model to provide linkages to the manufacturing sector.
Although Nigeria’s economy is still dependent on its oil sector, which provides 97.5% of foreign exchange earnings, the government is beginning to take the necessary step towards diversification. Despite declining output from the oil sector (which together with gas still accounted for 17% of GDP in 2009), strong performance in other sectors kept the overall growth rate at 6% in 2008 a slight fall from 2007. By 2009, despite the global economic crisis and weak oil sector, Nigeria had a real GDP growth rate of 4%, projected to rise slightly higher by the end of 2010 and to a respectable 5.5% by the end of 2011. However, the global recession, coupled with rising food prices and the drying up of lending as a result of the banking crisis, means the inflation rate has held at about 11% for 2010, up from 2007ss is 5.4%.
Following the signing of an IMF stand-by agreement in August 2000, Nigeria received a debt-restructuring deal from the Paris Club and a $1billion credit from the IMF, both contingents on economic reforms. Nigerian pulled out of its IMF program in April 2002, after failing to meet spending and exchange rate targets, making it ineligible for additional debt forgiveness from the Paris club. In November 2005, Abuja won Paris club approval for a debt-relief deal that eliminated $ 18 billion of debt in exchange for $ 12 billion of payments a total package worth $ 30 billion of Nigeria’s total $37 billion external debt.
Since 2008 the government has begun to show the political will to implement the market-oriented reforms urged by the IMF, such as modernizing the banking system, removing subsidies, and resolving regional disputes over the distribution of earning from the oil industry. GDP rose strongly in 2007-2011 because of growth in non- oil sectors and rebuts global crude prices. President Jonathan has established an economic team that includes experienced and reputable members and has announced plans to increase transparency, diversity, economic growth and improve fiscal management. Lack of infrastructure and slow implementation of reforms are key impediments to growth and development. The government is working towards developing stronger public-private partnerships for roads, agriculture and power.
Nigeria’s financial sector was hurt by the global financial and economic crises, but the central bank governor has taken measures to restructure and strengthen the sector to include imposing mandatory higher minimum capital requirements.
The Nigerian economy slowed down from 7.4% growth in 2011 to 6.6% in 2012. The oil sector continues to drive the economy, with average growth of about 8.0%, compared to 0.35% for the non-oil sectors. Agriculture and the oil and gas sectors continue to dominate economic activities and Nigeria economy. The fiscal consolidation, stance of the government has helped to contain the fiscal deficit below 3.0% of gross domestic product (GDP).this coupled with the tight monetary policy stance of the Central Bank of Nigeria (CBN),helped to keep inflation at around 12.0% in 2012. The outlook for growth remains positive. Short and mid-term downside risks include security challenges arising from religious conflict in some states, cost associated with flooding, slower global economic growth (particularly in the united state and china) and the sovereign debt crisis in the euro area.
The economic growth has not translated into job creating or poverty alleviation. Unemployment increased from 21% in 2010 to 24% in 2011 because the sectors driving the economic growth are not high job-creating sectors (the oil and gas sector, for example, is a capital intensive “enclave’’ with very little employment – generating potential) the major policy issue is employment generation, particularly among the youth, and inclusive growth.
The economic growth was not accompanied by a structural change of the Nigerian economy. The economy lacks diversification, and agricultural production lacks modernization. To address this, the government is encouraging the diversification of the Nigerian economy away from the oil and gas sector. It is addressing the infrastructure deficits in the country and the development of the agricultural sector through modernization and the establishment of staple-crop processing zones, with the value chain model to provide linkages to the manufacturing sector.
Although Nigeria’s economy is still dependent on its oil sector, which provides 97.5% of foreign exchange earnings, the government is beginning to take the necessary step towards diversification. Despite declining output from the oil sector (which together with gas still accounted for 17% of GDP in 2009), strong performance in other sectors kept the overall growth rate at 6% in 2008 a slight fall from 2007. By 2009, despite the global economic crisis and weak oil sector, Nigeria had a real GDP growth rate of 4%, projected to rise slightly higher by the end of 2010 and to a respectable 5.5% by the end of 2011. However, the global recession, coupled with rising food prices and the drying up of lending as a result of the banking crisis, means the inflation rate has held at about 11% for 2010, up from 2007ss is 5.4%.
I HOPE THIS HAVE BEEN
VERY INFORMATIVE,
Leave a comment bellow.
Get the Full Material delivered to your Email, . Call me on 07065065738 or 07034538881
Follow Us On Twitter,
Like Us On Facebook,
Join Our Cycle On Google+
Leave a comment bellow.
Get the Full Material delivered to your Email, . Call me on 07065065738 or 07034538881
Follow Us On Twitter,
Like Us On Facebook,
Join Our Cycle On Google+
we can keep u updated
by subscribing for free using your email
For more clarification, Please Leave a comment.
For more clarification, Please Leave a comment.
No comments:
Post a Comment