Nigeria gains but structural mire persists.
Citing Nigeria's central bank as its source, Reuters said that the Nigerian economy expanded 5.73 in the second quarter 2007, compared with 5.65 percent in the first quarter. The comparisons were to the same periods in 2006.
The expansion was mainly due to growth in Nigeria's non-oil sector. The non-oil sector grew 9.2 percent in the period from April 2007 to June 2007.
In its August 2007 estimates, the International Monetary Fund (IMF) concluded that Nigeria's GDP would grow only 4.3 percent in 2007. This compares with growth of 5.6 percent in 2006, and 7.2 percent in 2005.
For 2008, the IMF is estimating GDP growth of 8.0 percent.
Some of the reasons for the IMF's optimism for Nigeria GDP in 2008 were articulated in an October 23, 2007 Country Report (No. 07/353). Briefly stated, they are: "Robust economic growth, substantially strengthened fiscal and external positions, reduced core and headline inflation to single digits, and improved general confidence in the economy as reflected by a BB-rating by Fitch and Moody."
The IMF adds: "Significant progress was also made on structural reforms."
Not everyone agrees.
In a paper published by the University of Ibadan (Ibadan, Nigeria) titled, "Rethinking African Development," its sociologist author took substantial issue with the view of progress in Nigeria. The paper focused specifically on the country's oil sector, which even the IMF acknowledged has been struggling of late.
The paper says Nigeria is in the midst of an energy crisis. Prices for petroleum products are increasing sharply--increases accompanied by social unrest. "This situation is paradoxical when one considers the fact that Nigeria is the sixth largest producer and exporter of crude oil."
High petroleum product prices negatively affect the well being of nearly all of the country's consumers, says the paper. The country's aging, government owned refineries are poorly managed and productivity is low. "In fact," says the paper, "[the situation] is not the function of age but a function of prolonged period of neglect, executive corruption and lack of foresight on the part of previous and current government."
Violent crime is also a problem in Nigeria. A May 2007 Organization for Economic Cooperation and Development (OECD) report said, "Crime and insecurity in Nigeria continue to pose serious threats to the business climate and individual well-being." However, citing a 2006 household survey, the OECD noted 47 percent of respondents acknowledged improvement in the security situation.
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|Publication:||Market Africa Mid-East|
|Date:||Nov 1, 2007|
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