Posted on June 25, 2021

Once Africa’s Promise, Nigeria Is Heaving Under Crime, Few Jobs

Alonso Soto, Bloomberg, June 15, 2021

If there was ever a time Nigeria could have taken off, it was in 1999. Democracy had been restored, with its economy reopening after decades of mismanagement and plunder under military dictatorships.

Tomi Davies, a systems analyst, was one of thousands of Nigerians who came home to help rebuild the country. After a few years working on public-sector projects, he was offered a bag full of dollars to add ghost employees to the payroll system he was installing. When he refused, a group of men attacked him at his home in the capital, Abuja.

“I arrived like many others full of hope, but had to escape in disgust,” said Davies, 65, who returned to the U.K., where he is now chief investment officer of Frankfurt-based venture capital firm GreenTec Capital Partners.

Others like him have left too, defeated by the dashed aspirations of a nation that wasn’t supposed to turn out this way. Endowed with some of the world’s biggest oil reserves, plenty of arable land and a young, tech-savvy population of 206 million that sets Africa’s music and fashion trends, Nigeria had the potential to break onto the global stage.

Instead, policy missteps, entrenched corruption and an over-reliance on crude oil mean that a country that makes up a quarter of the continent’s economy risks becoming its biggest problem. A dangerous cauldron of ethnic tension, youth discontent and criminality threatens to spread more poverty and violence to a region quickly falling behind the rest of the world.

Since its discovery in the 1950s, beneath the mangrove forests of its south eastern coast, oil has dictated the boom and bust cycles of the former British colony, with the commodity now accounting for 90% of exports and half of government revenue.


The economy has yet to recover from the oil crash of 2014, and is unlikely to do so anytime soon, meaning its population will continue to out pace economic expansion adding more poor to what is already the poverty capital of the world. Over 90 million people live in penury, more than India, which has a population seven times greater.

A presidential spokesman referred questions to the government’s economics team. The finance ministry and central bank didn’t respond to several requests for comment.

The coronavirus has only made things worse. Personal incomes are set to fall to their lowest in four decades, pushing an additional 11 million people into poverty by 2022, according to the World Bank. One in three Nigerians in the workforce unemployed, among the world’s highest jobless rates, fanning social discontent and insecurity.

Policy blunders by President Muhammadu Buhari have complicated the road to recovery. He came to power in 2015 pledging to create 12 million jobs in his first four-year term; halfway through his second term, unemployment has more than quadrupled.

Buhari, 78, revived an import-substitution drive that was popular when he was a military ruler in the early 1980s, crippling businesses that can’t get goods to survive. {snip}

Policies like this have curbed foreign investment, pushed food inflation to 15-year highs and scared off companies such as South Africa’s supermarket chain Shoprite Holdings Ltd.


A surge in corruption also wrested away resources needed for infrastructure and a reliable power supply — both of which are lacking.

“In a lot of countries, people are used to officials skimming something off the top, but ultimately delivering something,” said Matthew T Page, an associate fellow at Chatham House in London. “In Nigeria, everything is skimmed off the top and nothing is delivered.”


Mistrust of the state and poverty seeded violence. A decade-long jihadist insurgency in the northeast rages on despite Buhari’s claims to have defeated Boko Haram militants in 2015. Piracy has also made the Gulf of Guinea one of the world’s most dangerous waters, while inland, a deadly conflict between nomadic herders and farmers in the middle of the country is moving south. {snip}