Nigeria's reliance on crude oil over the years has been subject controversy.
In recent times, the demand for oil globally has slumped. Global oil prices fell by as much as 15 per cent in March to $27 per barrel. This is threatening to destabilise Nigeria's plan of funding its budget by raising N2.64trn from oil sales of two million barrels a day at an assumed benchmark of $57 per barrel.
The dramatic change in oil prices occasioned by calls from environmental activists and more recently the Coronavirus (COVID-19) may force Nigeria to borrow more than it already plan to in order to fund the 2020 budget. But what do Nigerians think about all these?
“Nigeria’s continuous reliance on its crude oil is suicidal,” says Elias Ozikpu, a rights activist in the country.
He argues that Nigeria's failure to diversify its economy to sustainable alternatives despite modern realities would portend grave consequences for citizens in a short time.
“It cannot be considered sustainable. This is why Nigerians should not believe the daily delusional press statements from the Presidency in defence of the perilous economic situation confronting us. The truth is that other oil-producing countries across the world foresaw the present realities and immediately sought economic diversification. As usual, Nigeria didn’t.
“For instance, recall vividly that in 2016, Saudi Arabia launched what it called “Vision 2030” aimed at diversifying the country’s economy from oil. Tourism was then penned down as one of other numerous new ways to boost the country’s economy.
“Nigeria is presently at economic crossroads after failing to heed several warnings on the need to diversify the country's economy, particularly after the significant oil decline in 2015. The most provocative Nigerian policy in this regard, I think, is the reliance on oil resources as a source of foreign exchange earnings to the grave detriment of agriculture which ought to be one of the major sources of revenue generation for Nigeria. The implication of this is that the Nigerian economy has always been vulnerable. And as things stand today, there is no sign that the Nigerian situation will change for good.
“The country is clearly facing the harsh consequences of not having a visionary leader after 60 woeful years of independence,” he said.
Penny wise, pound foolish
The Debt Management Office in Nigeria says the country will borrow at least N1.549trn from domestic and international markets to fund its 2020 budget. This amount is almost the same as what is estimated by environmental activists for the full diversification of the economy into sustainable sources of energy and revenue.
“Truth is for a country like Nigeria to be blessed with diverse yet equally important climatic weather cutting across the six geopolitical zones to rely solely on oil and gas in an age of technological advancement is penny wise, pound foolish,” says Walnshak Guteng, an environmentalist working in Nigeria's North-central region.
He proposes that the country urgently shifts to renewable energy to avoid being obsolete in the comity of nations.
“We have at our disposable several options to explore, invent and utilise for the growth of the nation. What happened to groundnut pyramid and other agricultural products? What happened to the fecund human brains we have? These questions can go on and on. Sadly the structure has been laid in error – it must be oil or nothing.
“Renewable energy is the emerging global trend now and for Nigeria to not shift her attention there means we will soon wake up in a museum,” he concludes.
It's not sustainable
Experts say apart from adding unnecessarily to Nigeria's growing debt profile, which peaked at N26.21trn in 2019 from N25.701trn in 2018 according to statistics from the DMO, the country was missing out on exploring technology with the potential to rapidly grow its economy.
“Nations of the world are becoming less dependent on crude oil and petroleum products for their energy needs.
“The world through futuristic technologies are tapping into order sources of power generation and these sources tend to be more pure and healthier than crude power," says online marketer, Emmanuel Ejike.
He adds that, “We now have solar, electric and water powered automobiles and automotive engines, countries are even discovering more oil, countries that do not have have their reserves overflowing, we can't even control the price.”
Nigeria as a country faces a bleak future based solely on economic projections of the sustainability of crude oil. It however, also has an abundance of potential if it hopes to diversify into cleaner, cheaper and more stable alternatives.
“Before we discovered oil, we had agriculture. It's something we can still go back to. We have all the potential to succeed in agriculture,” says journalist, Seun Adewale.
Adewale opines that Nigeria has been unlucky in leadership with a will to change the status quo. He is however, hopeful that things can change soon.
“Another area we can look at is tourism. We have several tourist/tourism attractions, we just have not been lucky to have leaders who are ready to tap into this opportunity.
“Dubai is what it is today because of tourism. Look at Uganda for instance, every time people watch Arsenal football club play, they see ‘Visit Uganda’ on their jerseys. This is a country serious about tourism. Have you ever seen any ad on an international television channel inviting people to visit Nigeria?
“The millennial in the country, I believe they hold the key to change. Their willingness to have a conversation about their future is the hope that sustainable change can still happen in Nigeria,” he said.
This article was written with the support of Climatetracker.org as part of the 2019 Climate Tracker Data Journalism Fellowship