OIL has a central importance in our lives. Some have reasoned that without the easy revenue oil heaves into government coffers, the attractions of elective office would have dried up long ago. Oil runs government budgets, and with it the web of corruption often associated with oil.
An erroneous belief that relevance of oil approximates to the life span of Nigeria’s oil reserves fuels the askance with which the authorities treat diversification of the economy from oil.
Concerns over dependence of the economy on oil are not new. Total dependence on oil is the current worry, yet the matter gets no attention among the league of issues that disturbs the authorities.
Nigeria is mostly about oil and its depleting consequences on developing national resources, some of which are in more abundance and could provide more multiplier effects on the economy than oil. Oil depletes the environment in a manner few enterprises can.
Agitations for equitable use of oil resources fail in securing renewal of the ruined environment. Where would we find the funds to repair the environment? Perhaps more frightening is that with all the positions on laying more solid foundations for the economy, not much has been done in changing the focus of our oil-driven economy.
Oil could become irrelevant quicker than the most optimistic predictions.Its damages to the environment, its unpredictable high prices that task planning, the West’s inability to control the vital resource, are increasing the pace
of searches for alternatives to oil. America is making advances in this direction.
Nigeria’s economy remains primed on oil. Instead of investing the proceeds, they are shared, awaiting the next
allocation. Suggestions that the economy should be diversified, some more than 40 years old, are unimplemented. Oil still accounts for 95 per cent of exports and 75 per cent of consolidated budgetary revenues.
When prices dip, or more thieves help themselves to oil, like now, the authorities panic. Concerns are more for funds to run their budgets than creating an economy protected from the volatility of oil.
A May 2013 World Bank’s Nigeria Economic Report read, “Despite the recovery in oil prices, Nigeria expanded its fiscal stimulus significantly, increasing consolidated spending by an estimated 2.5 per cent of Gross Domestic Product, GDP, and drawing down the remaining balance of the Excess Crude Account at the same time that many other oil exporters were building back their reserves.”
Some would argue that the current reserves are about $38 billion; they obfuscate the issues of a broad-based, sustainable economy, away from the deceits of oil. Our governments should rescue Nigerians from the blight of oil. Even if it is late, at least we can start.