Case Study: Nigeria (NEE)

GLOBALLY

• Nigeria is the 12th largest oil producer - these revenues have significantly aided development of its economy
• Major global trading nation
• The 5th largest contributor to UN peacekeeping missions

CONTINENTALLY

• Despite issues with infrastructure and internal government corruption, Nigeria is said to have great potential for leading the way in African development
• In 2014 Nigeria had the highest GDP on the continent and third largest manufacturing sector
• Has the largest farming output in Africa, as 70% are employed in agriculture and it has the largest number of cattle

POLITICAL

• Following its independence from the UK in 1960, Nigeria has had civil wars and corrupt governments, as well as dictatorships
• An unstable government in an LEDC discourages other, richer, countries from investing in it
• The government is now stable, countries are investing in it - eg China putting money into contrustion in Nigeria's capital, and South Africa investing in businesses and banking

SOCIAL

• multi-faith and multi-ethnic can have strengths, however couples with lack of infrastructure, there is conflict and tension particularly in the north, which discourages tourists
• Divide in wealth - the south is much richer and has more cities etc. This means the north is far behind and foreign companies are interested in investing in the south, which creates a rise in northern unemployment

REGIONAL VARIATIONS 

• Variations in wealth - the south is much richer than the north, and the GDP is highest in the south
• Also inequalities in public services and facilities - eg in urban areas (like in the south) attendance to secondary school is 60% but in rural areas it's less than 40%

CULTURAL

• Due to diversity across the country, Nigeria has a lot to offer - eg its popular music
• Second largest film industry
• The Nigerian football team has won the African Cup of Nations three times

ENVIRONMENTAL

• North - semi-desert in the far north-east, and further south is savanna where cattle can be grazed on
• South - high temperatures and rainfall, lots of forest - opportunity for valuable crops such as cocoa, oil palm and rubber. No cattle due to the dangerous tse tse fly (fatal)

POLITICAL

• Member of the British Commonwealth and a leader of African political and economic groups (eg African Union)
• Strong links with the UN - in 2014 it was the 5th largest contributor of peacekeeping troops

TRADING

• Main exports are crude oil ('sweet oil' nickname for its good quality), natural gas, rubber, cocoa and cotton
• Nigeria imports huge numbers of mobile phones from China
• Roughly a third of all Nigeria's trade is with the EU
• HOWEVER demand for oil has fallen in recent years, and this has hit Nigeria hard
• 40% of the population are emplyed in the agricultural commerical sector

KEY CHANGES

• growth in machinery and better job opportunities has led to less employment in agriculture
• Increase in secondary (manufacturing) industry due to technology and industrialisation
• Growth of tertiary sector sure to more communications etc

WHY

• Many people speak English - this lends tself to growth in telecommunications
• Advances in technology - IT reduces the reliance on oil exports

IMPACTS ON ECONOMIC DEVELOPMENT

• Regular paid work in the formal sector increases, so people have more disposable income
• As employment rises and industries grow, tex revenue increases (boost economy)
• Good industrial sector attracts foreign investment (stimulates further growth)
• Oil processing creates by-products which results in the growth of other chemical based industries eg soaps, detergents and plastics

Oil has been fundemental in boosting Nigeria's economy and kick-starting its development. In 2014 it was that second largest section of employent in Nigeria, accounting for around 25%, second only to agriculture

• provides any jobs, decreasing unemployment
• led to other industries growing - eg chemical based manufacturing from the by products of oil processing, such as plastics or soap
• given people regular paid work in the formal sector which stabilises the economy as people have a more secure income

IS NIGERIA TOO DEPENDENT ON ITS OIL?

WHAT ATTRACTS TNCS

• cheap labour and tax incentives
• more relaxed environmental laws
• access to wider global market

ADVANTAGES TO THE NEE (eg Nigeria)

• employment and the development of transferable skills
• boosts the nation's economy by spending money, and boosts regional by increasing orders, benefitting other companies locally
• TNCs are likely to invest in infrastructure and education

DISADVANTAGES TO THE NEE

• Locals can be given poor wages (exploited for cheap labour) in bad working conditions
• Management/highly paid jobs are often given to foreign employees, not locals
• Much of the profit goes abroad to the TNC's headquarters
• Money/investments to attract the TNC could have been invested in development of the NEE

UNILEVER - based in the UK

• uses locally-produced and sustainably sourced palm oil for its products which are also aimed at the Nigerian market and designed to help improve the quality of life
• Currently employs 1500 people
• Promoted improvements in healthcare, education and water supply

SHELL OIL - based in the Netherlands

advantages

• Boosting Nigerian economy with huge contributions in taxes and export revenues
• Direct employmen to 65 000 Nigerians
• Giving 91% of Shell contracts to Nigerian companies

disadvantages

• Oil spills - result in water pollution and soil degradation, and oil flares release toxic fumes
• Militant groups disrupt the oil supply in the delta, eg in January 2018

WHY DOES IT NEED AID

• despite recent growth in economy, Nigeria still has a limited access to sanitation, safe water and reliable electricity
• life expectancy is low and infant mortality rate is high, especially in the north (poorer areas)

WHAT AID IT GETS

• receives around 4% of all African aid, mostly from the UK and USA
• reducing over-dependence on oil revenues - 2014 development project set up to fund long term loans to businesses
• UK funded a health and HIV programme and USA funded an educational AIDS project to educate people, especially in rural areas
• Education on malaria prevention (and distribution of nets) from NGO Nets for Life programme

WHEN AID IS USED INEFFECTIVELY

• corrupt government may take money for itself
• government may deliberately divert the money away from citizens to develop military
• donors may have political influence over where the aid goes, or could use the aid as personal promotion

EXAMPLE OF AID IN NIGERIA

Aduwan Health Centre

• In northern Nigeria (poor infrastructure, less rich than the south)
• Area of high infant mortality and high incidence of HIV/AIDS
• Project aims to educate mothers on the importance of immunisation, as well as carrying out vaccinations and tests for HIV etc

Small scale development projects like this are very important as the economy is already flourishing, and in order to boost this, people must live to be able to work etc

INDUSTRIAL GROWTH - IMPACTS

• Water pollution - incorrect disposal of chemical waste threatens groundwater quality and ecosystems
• Air pollution - from chimneys. Can also cayse respiratory problems in humans
• Desertification - made worse by large-scale dam and irrigation schemes used in industry
• Deforestation - urban expansion etc have destroyed 70-80% of Nigeria's forests

URBANISATION - IMPACTS

• Squatter settlements - rapid urban growth has led to shanty towns
• Waste disposal - huge population = huge waste, which is often not disposed well, and services fail to keep up with demand
• Urban sprawl - some green belts are built on as cities expand, endangering wildlife and biodiversity

COMMERCIAL FARMING AND DEFORESTATION

• Soil erosion - deforestation and over-grazing have led to the degradation of land
• Water pollution - leaching and surface runoff of fertilisers has led to polluted waterways
• Deforestation - improving infrastructure (roads) and settlements has destroyed habitats
• CO2 - these emissions have also been contributed to through these practices

MINING AND OIL EXTRACTION

• Tin mining - led to soil erosion and chemicals polluted local waterways
• Oil spills (eg Bodo spills, 2008-9) - add to CO2 emissions and cause acid rain. The Bodo spills involed 10 million gallons of crude oil, and devastated the livelihoods of local fishermen and farmers

BENEFITS

• better paid jobs in formal sector = reliable income and more disposable money to spend on food, clothes, education...
• better diet = better performance at work/school which will feed back into the economy
• better infrastructure = eg reliable electricity makes it easier for people to do homework or go out at night
• higher quality of healthcare = longer, happier lives

INDICATORS

• HDI - in 2000, Nigeria was one of the least developed countries but in 2011 it had one of the highest average improvements

HINDRANCES

• poverty - 60% of Nigeria's population live in poverty, and access to essential services like safe water and education is a problem
• corruption - money has not been spent effectively