Nigeria remains one of the world’s least diversified countries, the World Bank has said, despite repeated promises by different administrations, including that of President Muhammadu Buhari.
According to the Washington-based global financial institution, while Nigeria remains obsessed with oil business, some countries have achieved greater diversification over the past decades and have grown more quickly with more consistent growth overall.
“Nigeria remains one of the world’s least diversified countries,” World Bank said in the June edition of its Nigeria Development Update. “Dependence on oil exports makes the country vulnerable to price shocks.”
Seven years ago, President Buhari’s message to Nigeria was a simple one: fix infrastructure by building functional rails and accessible road roads and reap the benefits by having a more diversified economy championed by a vibrant agricultural sector with more farm produce gaining easier penetration across the country.
The agriculture sector has grown at the weakest rate under the Buhari administration since the return of democracy in 1999, according to data from the National Bureau of Statistics (NBS) and Statisense, a data consulting firm.
The sector grew at an average of 10.48 percent between 2016 and 2020, the lowest since 1999.
By comparison, the sector averaged 18.79 percent between 2011 and 2015 under former President Goodluck Jonathan, while between 2006 and 2010, a period that covers the tail end of former President Olusegun Obasanjo and late President Musa Yar’Adua, the sector recorded an average growth of 27.6 percent.
“Most of Nigeria’s exports are currently concentrated in oil while the remaining exports are mostly basic agricultural goods that add little value,” World Bank said.
The multilateral lender noted that Nigeria currently exports relatively little to the rest of Africa, as oil exports are primarily directed outside the continent.
“Services exports account for a small but growing share of total exports,” it said.
In one of his campaign promises, Buhari said he would guarantee a minimum price for all cash crops and facilitate the storage of agricultural products to overcome seasonal shortages of selected food crops. These measures were supposed to be geared towards driving down food costs.
There has, however, been a spike in food prices since the beginning of his tenure in 2015, jumping by the most in 2021 with a 22.7 percent increase compared to 9.4 percent in 2014, according to data gleaned from the NBS.
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Buhari also promised to make the economy one of the world’s fastest-growing emerging economies, with real GDP growth averaging at least 10-12 percent annually, but the country has not achieved an annual growth rate of 5 percent since 2015.
To have a favourable balanced trade, a country’s exports must be greater than its imports, or both imports and exports must be equal. Buhari promised to embark on export and production diversification to strengthen the economy, but imports have increased in value over the past seven years, resulting in lower revenue generation.
“Despite all of Nigeria rhetoric’s about diversification, the country is still far away from having a diversified economy,” Muda Yusuf, chief executive officer of Centre for Promotion of Private Enterprise, said.
