Economic Challenges Facing Nigeria

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Recommended: Introduction, the economic growth and development in Nigeria

Nigeria is the largest country in Africa and accounts for 47% of West Africa’s population stretching a land are of 910,770 (sq. km). It richly endowed human and natural resources, making it the African destination of choice for serious investors to take advantage of a potentially large market. The government’s “Vision 20:2020” Plan seeks to position Nigeria as one of the top 20 economies in the world by the year 2020. Will Nigeria live up to its goal?
This essay seeks to address the question by examining its: i) economic indicators, ii) comparative advantage, iii) trade patterns in relation to gravity model of trade, iv) attractiveness for international firms and finally conclude by raising future economic problems.
Economic characteristics
Population/ Unemployment
The total population in Nigeria was last recorded at 168.8 million people in 2012 from 73.7 million in 1980. Population doubled in the last 30 years . (World Bank 2013) Over the last 20 years, it has a consistent average of 2.7% annual growth rate . The population of Nigeria represents 2.35 percent of the world´s total population which arguably means that one person in every 43 people on the planet is a resident of Nigeria. Its labor force constitute 1/3 of its population as close to half of its population are aged below 14 years and less than 5% aged 60 and above due to poverty or diseases. (UN 2013) However with its large population, it faces huge unemployment rate of 23.9% in 2011, up from 21.1% in 2010. Its average rate was 14.6 %. (Appendix 1) Unemployment in the 15-24 age group amounted to 37%, as for 25-44 years was 22.4%.
Gross Domestic Product (GDP)
Nigeria’s economy is worth 242.9billion US dollar, and is experiencing a period of overall growth. (Appen...

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...nk. 2013. The Africa Competitiveness Report 2013. [online] Available at: http://www.worldbank.org/content/dam/Worldbank/document/Africa/Report/africa-competitiveness-report-2013-main-report-web.pdf [Accessed: 8 Dec 2013].

Data.worldbank.org. 2013. Liner shipping connectivity index (maximum value in 2004 = 100) | Data | Table. [online] Available at: http://data.worldbank.org/indicator/IS.SHP.GCNW.XQ [Accessed: 8 Dec 2013].

ChartsBin. 2013. Current Worldwide Reserves-to-production ratio of Oil. [online] Available at: http://chartsbin.com/view/7r4 [Accessed: 8 Dec 2013].

National Planning Commssion. 2011. The Transformation Agenda. [online] Available at: http://www.npc.gov.ng/vault/Transformation.pdf [Accessed: 8 Dec 2013].

Nigeriaintel.com. 2013. Brain drain. [online] Available at: http://www.nigeriaintel.com/2013/09/17/brain-drain/ [Accessed: 8 Dec 2013].

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