For most Nigerians, especially those living in the Niger-Delta, Nigeria's oil wealth is actually 'oi

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Availability of natural resources is often taken to naturally contribute if not be a major contributor in a nation's tour edge exotic economy prowess. This enviable position often given to natural resources in the chess place of economic growth is not connected to the fact that natural resources especially fossil fuel plays a serious role in world economy. Unfortunately, the economic potentials of natural resources do not in every case translate into an actual economic growth neither does it guarantee a good sense of resource management. This reality is what gave birth to the term Dutch Disease. The term is commonly used to denote a situation where the presence of natural resources tour edge exotic rather than being a source tour edge exotic of greater industrialization actually weakens and render, most often, tour edge exotic any existing tour edge exotic industrialization capacity weaker. In such a situation, non extractive resources and service related industries either tour edge exotic remain stagnant or de-industrialized.
Nigeria which is the primary concern here is a typical non extractive developing economy prior to the discovery and actual extraction of fossil fuel at the dawn of independence. With arable land in the north and swampy coast of the south, agriculture offered Nigeria the opportunity to develop a strong agro industrial based economy until the discovery of the fossil fuel. Whereas over 90% of Nigerian income comes from extraction of natural resources today, the reverse was the case in the economic development history of Nigeria until early 1960s. The expected investment and consequent development in the agricultural tour edge exotic sector did not happen. tour edge exotic Why was this the case? It may be over simplifying the issue just by saying that it is a common feature of Dutch disease or merely recourse to mismanagement of resources.
tour edge exotic Obviously mismanagement of resources tour edge exotic cannot tour edge exotic be divorced from the economic tour edge exotic dilemma of Nigeria as it relates to non development of non extractive industry with the discovery of fossil fuel. However, mismanagement resources cannot take place in a vacuum. Hence, in this work, it is my main interest to ask what made Nigerian economic development caught up in web of Dutch disease. Efforts will be made also to see the connection if any, that the mismanagement of resources has with the discovery of fossil fuel in Nigeria. It is my aim to proffer tour edge exotic any possible solution to redress the trend of mismanagement of resources in the Nigerian economic tour edge exotic development.
In reaching the above stated objectives, this work is divided into four chapters. Chapter one addresses the general overview of Nigeria with associated agricultural endowment possessed by various components of the nation before the exploration of fossil tour edge exotic fuel. Chapter two will focus on the discovery and extraction of fossil fuel in Nigeria and its potentials as well as real impact on the developing economy. In chapter three, I will try to locate the factors responsible for the mismanagement of resources in the wake of extraction activities in Nigeria. The fourth chapter, which is the last one, and deals with proffering ways of putting the Nigerian economic development squarely on a development tour edge exotic part once again. Conclusion follows therafter.
Numerous researchers, like Gylfason (2001), Sachs and Warner (1995), and Sala-i- Martin (1997), all found a negative connection between natural resource abundance and economic growth. Classical economic theory would predict that abundant natural resources should be good for the economy but the opposite seems the case here in most developing countries with natural resources. tour edge exotic The tern Dutch disease, Paradox of the plenty and Resource curse are economic terms used in describing the negative connection between natural resources abundance or any large capital inflows into an economy and economic growth.
The term `Dutch disease' was first seen in print form in the Economist( 26 November 1977, pp. 82-3), when the discovery of natural gas in the early 1960s had severe effects on the Dutch manufacturing industries by causing the Dutch real exchange tour edge exotic rate to appreciate. This appreciation of the real exchange rates makes the local manufactures less competitive in the international market which results to low export, which on the other hand leads to the gradual deterioration of the manufacturing sector.
For most Nigerians, especially those living in the Niger-Delta, Nigeria's oil wealth is actually 'oil of poverty' or a curse, because it has produced only poverty, underdevelopment and conflicts since its commercial exploitation began in the late 1950s . Such a conclusion is not aberrant as 'it is now almost conventional tour edge exotic wisdom that (natural) resources are a curse for developing countries' with abundance of natural resources causing poor growth and raising the incidence intensity and duration of conflicts . The negative conclusions tour edge exotic about the developmental role of resources is a far cry from earlier post World War hopes and the promise that resource endowment would 'lift' many countries out of poverty; tour edge exotic as 'not only would resource exploitation generate fiscal revenues and jobs, but also the necessary tour edge exotic investment capital for an economic take-off. Windfall resource revenues, in other words, should tour edge exotic prove a bonanza' .
In the case of Gulf States oil boom, labour immigration offsetted the effects of Dutch disease while shifting the symptoms to the labour exporting country. The labour exporting country had a lot of money being sent home by the labourers in the Gulf States which artificially boosted the exchange rate and as a result of the home countrys` manufacturing industry paying more to secure labour locally. The symptom of Dutch disease does not necessarily occur as a result of world price boom or major resource discovery but also from any large capital inflows into an economy.
But 'for every Venezuela and Nigeria, there is a Norway or a Botswana' (Robinson et al 2005:7) Research on 'paradox of plenty' has prompted, in recent times, a renewed interest tour edge exotic in political factors as key explanatory variables, or as key components of the resource curse mechanism in developing countries. For example, tour edge exotic it has been argued that 'poor economic growth tour edge exotic is itself a political product, the consequence of what politicians do with resource rents' (Englebert 2000; Ron 2005:447) and of presence or absence of 'political institutions which promote the accountability of politicians' (Robinson 2005:6). Thus, if resource booms create underdevelopment, it cannot be because 'they induce tour edge exotic inefficiency in the rate at which they are extracted, but because politicians make policy mistakes which are in fact rational political strategies, in response to the incentives induced by resource rents' (Robinson et al. 2005:6). As argued tour edge exotic by Rosser, Put differently, scholars have been asking the wrong question: rather tour edge exotic than asking why natural resource wealth has fostered various political pathologies and in turn promoted poor development performance, they should have been asking what political and social factors enable tour edge exotic some resource abundant countries to utilize their natural tour edge exotic resources to promote development and prevent other resource abundant countries from doing the same (Rosser 2006:10
Nigeria is a country with varying climatic conditions. It is tropical in the center, equatorial in the South and arid in the North. It lies between 3oE and 15oE, and between 4oN and 14oN in Western Africa. Nigeria has borders in the North with Niger and Chad, Republic of Benin in the West, Republic of Cameroun in the East and the Atlantic Ocean in the South. Nigeria has a total land mass of 923,768Km' that is made up of 910,768Km' of land and 13,000Km'water. Figure (1) below is the geographical map of Nigeria. Nigeria is a country endowed with a lot of mineral resources like fossil fuel (crude oil, natural gas, coal and lignite), radioactive minerals (Uranium, monazite and zircon), metallic minerals ( tin, columbite, tour edge exotic iron, lead, zinc, gold), non-metallic minerals (limestone, marble, gravel, clay, shale, feldspar) and arable land .
Starting from 1914 when Nigeria was created until the end of 1960 when Nigeria got her independence, and until the end of the first decade after independence. Nigerian economy has been agro-based. Agriculture has been the main source of income for the economy. During 1914-1959 when Nigeria was still being colonized by the British, it was stated that Nigeria was being exploited for its agricultural products. The country was known for the production of some main agricultural products like groundnut and cotton (produced in the North), cocoa (produced tour edge exotic in the West), and Palm oil (produced in the East, which includes the Niger-Delta region). About 70 percent of the entire population was engaged in one form of Agriculture of the other. During the colonial era, railroads, roads and harbors were developed and market for consumer goods emerged as well with agricultural marketing board playing tour edge exotic the role of NNPC today .
Exploration of oil in commercial quantity started in 1956 but did not play any major role until the early 1970s. According to Robinson`s report, in the early 1960s, revenue from oil accounted for less than 10 per cent of Nigeria`s revenue base which can be seen in 1963 and 1964 where oil revenues were only 4.1 per cent and 5.9 per cent respectively of the total revenue of the country. This means that Nigerian economy was formally not oil based, the majority of the country`s revenue during this period was from Agriculture, and more than 70 per cent of the people were employed in this sector. However, after the Nigerian civil war in 1970, the yield of oil began to increase and the dominance of agriculture in the country`s economy began