Right after the civil war, oil boomed. Nigeria’s exports from crude oil had burgeoned almost fifteen times in size from the early days of crude exportation in the 1960s. The meteoric rise of Germany and Japan had put a lot of demand on oil, shooting its price to astronomic levels. Coupled with the embargo on Middle East oil exports, revenues from crude oil exportation accounted for almost 79 per cent of Nigeria’s foreign exchange earnings.
Oil had instantly phased out a thriving agricultural export sector while entrenching itself as the country’s mainstay. The young and inexperienced military leadership didn’t help the disease that would soon overtake the country. Everybody wanted a piece of the action. Nigeria would witness the nascence of a five decade reign of avid kleptocrats, pillaging crude oil with the help of foreign accomplices. That generation was reckless- a curious case of the immature stumbling into wealth. Nigerians had on record, become the second largest consumers of Champagne, second of course to its producers, France. And the ‘squander-mania’ continued into the early 1980s, even after the money was all gone.
The civilians proved no better. Shagari and Ekwueme launched a five year plan at the outset of their administration valued at $154bn to invest in public and private projects. The plan was to be funded by anticipated oil revenues. Nigeria further spiraled into a borrowing spree. The appetite of the populace for imports began its rise during this period and has remained unabated to this day.
Nigerians were forced into austerity. Babangida was advised to implement the Structural Adjustment Program (SAP) to help repair the profligacy of the oil boomers. The problem was that the causes of the original problems remained constant; oil remained the country’s mainstay, the appetite for imports increased and corruption reached shuddering crescendos during the military regimes of IBB and Abacha.
Today, things have not changed much. Despite achieving the write-off of a twenty-five year old debt during the Obasanjo administration, a younger generation of leaders has largely followed in the footsteps of its predecessors. The failure to develop the country’s production capacity, invest in innovation and ultimately diversify Nigeria’s economy will create woes for the successive generation.
We still depend on oil. And with an estimated $500bn unaccounted for by Nigeria’s leadership since independence, and our oil reserves estimated to dry up by the middle of this century, fifty years is a pretty short time. Don’t you agree?