The World Bank says Nigeria’s dependence on oil exports is the leading cause of the frail growth prospects of the country.
Relying on oil exports is the major cause of Nigeria’s frail growth prospects
"Nigeria’s dependence on oil exports is one of the leading causes of its frail growth prospects"
World Bank Group
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This was disclosed this in the bank's latest report titled ‘A Better Future for All Nigerians: Nigeria Poverty Assessment 2022’.
According to the report, the development leaves Nigeria’s economy extremely exposed to movements in global oil production and global oil prices.
“Nigeria’s growth performance was declining even before the COVID-19 crisis,” the report reads.
“Between 2000 and 2014, Nigeria enjoyed a period of sustained expansion, during which the economy grew by around 7% per year, outstripping the estimated annual population growth rate of 2.6%.
“Yet real GDP growth dropped to 2.7% in 2015, then -1.6% in 2016, as the decline in global oil prices induced Nigeria’s first recession in almost two decades.
“Growth has not recovered subsequently. It lies below population growth and the growth performance of peer countries over the same period.
“This weakening overall growth performance makes it significantly harder to reduce poverty. Nigeria’s dependence on oil exports is one of the leading causes of its frail growth prospects; it may also prevent any growth from being broad-based.”
According to the report, in 2019, while oil represented just 10% of GDP, it accounted for more than 80% of Nigeria’s total exports.
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