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Nigeria’s dependence on oil is not 75 percent, it is 8 percent – hence we have a future (Part One)

By News Express on 14/03/2017

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Since my secondary school days in the eighties, I kept on hearing statements like the Nigerian economy is 75% dependent on oil. This famous cliché about the Nigerian economy has grown over the years, so much so that when everything changed about the Nigerian economy, nobody seemed to take notice. People continued to make unsubstantiated claims without bothering to do any research or investigation, on the subject matter. 

It becomes even more alarming, when government officials, ministers, members of cabinet, parliamentarians, make such ungrounded and uneducated claims. Having lived outside of Nigeria for the past 30 years of my life, I am always amazed at the ignorance of an average Nigerian about their country.

The level of self-bashing and tongue lashing by Nigerians about themselves and their country is simply disgraceful. I actually think we are the ones who give outsiders the wrong impression that Nigerians are evil people through our negative talk about our country.

I don’t know about you, but from my own interactions and knowledge of Nigerians, it’s a completely wrong notion to think that Nigerians are mainly bad people.  I, personally have met an overwhelmingly greater percentage of “good” Nigerians as opposed to “bad” ones. In my own estimation, the ratio would be 95:5 “good” to “bad”.

“A man’s stomach shall be satisfied from the fruit of his mouth; from the produce of his lips he shall be filled. Death and life are in the power of the tongue, and those who love it will eat its fruit.” Prov. 18:20-21

If we are to relate the above scripture to a nation, it would probably read somehow like this “A nation’s destiny, shall be gratified by the words of her citizens. With the produce of their lips, a country shall be filled.”

From this paraphrase, we could go further to expatiate that the destiny of each nation is shaped by the words coming from the mouth of her citizens. This means that it is what we mainly speak- good or evil about our land, that our land produces and becomes.  Our words, attitudes and actions produce the fruit that spread across the nation. That is according to verse 20 of proverbs 18.

This lesson from the wisest man that ever lived, King Solomon, becomes much more vivid in verse 21. “Death and life are in the power of the tongue.” However, to me the second part of that verse is the most telling “and those who love it will eat its fruit.” Meaning those who love to speak evil will definitely be fed by the fruits of evil, those who love to confess death shall eventually reap death. The opposite is also true. Those who love to speak and confess life will reap the fruit thereof. Those who proclaim good and only good about themselves and their nations, will inherit good.

What a stunning submission, both death and life are in the power of a man’s tongue. He himself, determines what he fills his life, his family, his nation and his destiny with. My fellow Nigerians, let us choose life. Let us begin to speak the truth about our country. Let us begin to speak life upon our nation!!!

In regards to the notion that Nigeria’s economy is 75% dependent on oil- it is simply not true! But if you go across Nigeria today and conduct a survey, an overwhelming majority would probably tell you, yes, this is true. They consequently use this claim as the basis for bashing the country, giving a tongue lashing about how much we have failed as a nation.

Yes, we have failed in a lot of ways as a nation and I would be the first to admit it, but our proclamations must be factual and truthful. I would not have had any issues with this statement about Nigeria being 75% dependent on oil, if it were true. This is because the truth must be our only basis for action.

So what is the truth about the statement of Nigeria being 75% dependent on oil? The truth is that Nigerian economy is not 75% dependent on oil. According to 2012 statistics we were only 14% dependent on oil. But after the rebasing of the Nigerian economy, oil’s contribution to our economy has been reduced to only about 8% (2014 statistics).

So why do most people say, our economy is dependent mostly on oil? I think the problem is actually with our surface thinking and lack of deeper analysis. The majority of Nigerians, don’t think analytically, we don’t carry out research or scientific investigations. The majority of our populace, mainly depend on hearsay, we tend not to do our due diligence.

The truth is that the Nigerian economy gets 75% of its foreign exchange earnings from the export of oil. That is to say, the income the country gets from all our exported commodities places oil as our main export product. As a result, 75% of our foreign exchange earnings come from oil, not 75% of our economy- this is very different and must be noted for clarity. If we are to compare everything we earn from oil and put it on one side, it would only amount to 8% of the total revenue generated in our economy. 

As you can see this is a total departure from the impression that is being created by most people who say we are 75% dependent on oil. Having noted a clearer picture that we actually produce 92% more wealth from other sources other than oil as a nation. The question that arises therefore is, why are we not exporting these other commodities and produce for foreign exchange earnings?

In order to answer this question we must consider the many reasons for our dependence on oil for foreign exchange earnings:

The biggest contributor to our economy is agriculture, mainly consisting of consumables, rather than export earnings.

In order for us to export our agricultural produce, we must ensure they are of the highest quality to compete with the best in the world.

If you are a business man and you are producing anything, it is easier for you to sell them in Nigeria than outside the country. Because to export internationally the quality of the product must fulfill international standards and criteria.

Furthermore not only must the quality be good enough, but the price must be competitive enough to sell outside the country.

We mainly export oil because we abandoned our main export industries. Examples include: palm oil, cocoa, groundnuts, timber, cotton, etc.

So what can we do to break our dependence on oil for foreign exchange earnings, in light of the falling oil prices? The demand for oil is diminishing all over the world. Developed countries are finding alternative sources of energy. Also, the Nigerian oil reserves are not indispensable, we are running out of oil.

How then can Nigeria keep on earning foreign currency from other sources other than oil? Let me first of all give you the direction that the Nigerian government is now trailing. In my opinion both the outgoing government of President Jonathan and the incoming government of President Buhari are getting it wrong, especially the state governors.

I hear the newly elected government talk about exploring other sources of income in solid minerals and other natural resources. Yes, this measure could deliver us from our dependence on oil money, but I still believe that this is old school thinking. However, before I go into that, let’s examine what I call temporary measures for our transitional period:

The old exports we had that earned us foreign currencies were mainly natural resource based: oil, palm oil, cotton, timber, etc. I call them old school products. There are many more raw materials in Nigeria apart from oil that could be exported for foreign earnings. Many of our government ministers are still hoping to use raw materials to get us more foreign currency. I believe this is old school thinking

So many states in Nigeria are trying to go back to this old foreign exchange earners as I mentioned above: palm oil, groundnut, cocoa, timber etc. many states are increasing efforts to revamp these industries for foreign exchange earnings.

In my opinion the only case we could make for using these raw materials as foreign exchange earners, is only as a temporary relief measure while transitioning from oil to other future products.

Other raw materials like uranium, columbite, tin, coal, and textile could earn us as much as we are presently earning from oil. This should also be viewed only as a temporary relief to be used as a transitional measure while we are moving on from oil to future products. We have to totally depart from our dependence on raw materials for our foreign exchange warning.

My personal opinion is that any form of reversion to raw materials as a means of foreign exchange earnings for the country is counterproductive. I think the way to go is to encourage our young entrepreneurs to produce products that will be better than other country’s produce. The 21st century world will no longer depend on natural resources.

Let me therefore suggest what I believe could be the real answer to our foreign exchange earnings going forward. It is what I call the futuristic businesses and leaders. I would advocate we go for 21st century produce, goods and services that are in demand in every country of the world. 

Thank God we already have some futuristic business gladiators in our country. These men are seeing into the future. I am proud of them. It is clear they know what they are doing. Our government must get behind these men to give them all of the support they need. Through their proactive business approach we could soon forget that we used to look up to oil for foreign exchange earnings. 

Dangote is a futuristic thinker. His target is export of finished products for foreign currency, not natural resources, but industrial products. Dangote is already putting Nigeria on the world map. His efforts would soon begin to earn much more foreign exchange earnings for Nigeria. He wants to make Nigeria one of the leading exporters of industrial products like cement, rice, salt, oil products etc. Again Kudos, Mr. Dangote!

Michael Akindele is a young man of the future. He produces mobile phones and other mobile devices that are already overrunning apple, Samsung, Nokia, etc in Africa. Can you believe this? These are Nigerian brand mobile devices. This is a better foreign currency earning for Nigeria in the 21st century. We better support men like this to make the Nigerian brand go viral. That is where the government money should go. Can you imagine giving Michael Akindele an investment that would boost his output by 10 to 100 times? Nigeria would simply take the world by storm!

Innoson IVM, owned by Chief Innocent Chukwuma, the first indigenous manufacturer of 100% Nigerian made vehicles. He is a man of the future. This is a better foreign currency earner for the country in the future. The government has to put money behind him to produce enough and to export to as many countries of the world as possible.

Taofick Okoya is a man of the future because he is running the US Barbie Company out of Africa. That is a better way to earn foreign currency for Nigeria. If only the federal government would find it necessary to put their weight behind him.

•Dr. Sunday Adelaja is a Nigerian born leader, Transformation Strategist, Pastor and innovator who lives in Kieve Ukraine. He can be contacted at

Source News Express

Posted 14/03/2017 3:41:26 PM


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