Nigeria

People and Society
There are an estimated 250 ethnic groups in Nigeria. Each inhabits a territory that it considers to be its own by right of first occupancy and inheritance. Individuals who are not members of a dominant group but who have lived and worked for several decades in the territory of the group are still considered to be aliens. In most rural areas, such aliens may not acquire outright title to land, yet considerable numbers of people have migrated from one ethnic territory to another in search of farmland. There are three major ethnic groups in the country: the Hausa–Fulani, the Yoruba, and the Igbo.
Education
Nigeria’s adult literacy rate was 69.1 percent on average, with a higher rate for men (78.2 percent) than for women (60.1 percent). Nigeria provides free, government-supported education, but attendance is not compulsory at any level, and certain groups, such as nomads and the handicapped, are underserved. The education system consists of six years of primary school, three years of junior secondary school, three years of senior secondary school, and four years of university education leading to a bachelor’s degree. 59 percent of girls and 68 percent of boys were enrolled in primary school. However, only 23 percent of girls and 28 percent of boys were enrolled in secondary school.
Although federal and state governments have the major responsibility for education, other organizations, such as local governments and religious groups, may establish and administer primary and secondary schools. Most secondary schools, trade centers, technical institutes, teacher-training colleges, and colleges of education and of technology are controlled by the state governments.
Nigeria has more than 130 universities and colleges widely dispersed throughout the country in an attempt to make higher education easily accessible. Many of the universities are federally controlled, and the language of instruction is English at all the universities and colleges. At the time of Nigeria’s independence in 1960, there were only two established postsecondary institutions, both of which were located in the southwestern part of the country: University College at Ibadan (founded in 1948, now the University of Ibadan) and Yaba Higher College (founded in 1934, now Yaba College of Technology). Four more government-operated universities were established in the 1960s: University of Nigeria, Nsukka (1960), in the east; University of Ife (founded in 1961, now Obafemi Awolowo University) in the west; University of Northern Nigeria (founded in 1962, now Ahmadu Bello University) in the north; and University of Lagos (1962) in the south.
Economy
Nigeria’s energy revenues flow to the government, 16 percent cover operational costs, and the remaining 4 percent go to investors. However, the World Bank has estimated that, as a result of corruption, 80 percent of energy revenues benefit only 1 percent of the population. Following a milestone agreement with the Paris Club of lending nations in 2005 and a similar agreement with the London Club of lending nations in 2006, Nigeria succeeded in eliminating almost all of its external debt. The agreements consisted of a combination of debt forgiveness and repayment from the country’s energy revenues. Outside of the energy sector, Nigeria’s economy is highly inefficient. Moreover, human capital is underdeveloped—Nigeria ranked 158 out of 177 countries in the United Nations Development Index in 2005—and non-energy-related infrastructure is inadequate.

Agriculture
The agriculture, forestry, and fishing sector constitutes about 17.6 percent of the gross domestic product but employs up to 70 percent of the workforce. Agricultural products include cassava (tapioca), cocoa, corn, millet, palm oil, peanuts, rice, rubber, sorghum, and yams. Livestock products include cattle, chickens, goats, pigs, and sheep. Although overall agricultural production rose by 28 percent during the 1990s, per capita output rose by only 8.5 percent during the same decade.
Agriculture has failed to keep pace with Nigeria’s rapid population growth, so that the country, which once exported food, now relies on imports to sustain itself. About two-thirds of all Nigerians obtain a living from agricultural production. Most are small-scale subsistence farmers who produce only a little surplus for sale and who derive additional income from one or more cash crops and from the sale of local crafts. Farms are small, usually less than 2.5 acres (1 hectare) in the south and about 7.5 acres (3 hectares) in the open grassland areas of the north. Because the soil is not totally amenable to mechanized equipment, the hoe and matchet (machete) continue to be the dominant farm implements. The shortage of farmland in some localities and limited access to land in others are among the factors that restrict the size of farmland cultivated per family. Environmental deterioration, inferior storage facilities, a poor transport system, and a lack of investment capital contribute to low productivity and the general stagnation in agriculture.
Manufacturing
Industry accounts for 53.1 percent of Nigeria’s gross domestic product (GDP), much of which is attributable to the lucrative energy sector, and it employs about 10 percent of the labor force. The oil and gas sector accounts for 95 to 99 percent of Nigeria’s export revenues. Manufacturing’s share of export revenues is estimated at 1 percent. By contrast, in 2005 manufactured goods constituted the largest category of imports. In 2006 the capacity utilization rate of the industry stood at 53.3 percent, a relatively low rate that policymakers hoped to increase by reversing capital flight and removing impediments to private-sector activity.
Revenue from mining has enabled the federal government to establish such capital-intensive industries as the Ajaokuta and Aladja steel mills, pulp and paper mills at Oku Iboku and Iwopin, petrochemical plants at Kaduna, Abuja, and Port Harcourt, and an aluminum smelter at Ikot Abasi. In the past, large-scale manufacturing—dominated by the production of textiles, tobacco, beverages, and cement—was controlled by foreign investors. The government’s indigenization efforts have altered the ownership situation, although the management and effective control of most large factories have remained in the hands of expatriate representatives of multinational corporations.
Energy
A member of the Organization of the Petroleum Exporting Countries (OPEC), Nigeria has proven oil reserves of 36.2 billion barrels, the tenth largest reserves in the world. Most of the reserves are located in the Niger River Delta. In 2006 Nigeria produced 2.4 million barrels per day of oil, approximately 2.1 million of which were exported. Nigeria ranks as the world’s eighth largest exporter of oil and the United States’ fifth largest source of imported oil.
Resource extraction is the most important and the fastest-growing sector of the economy, reflecting the rise to prominence of crude oil output. Nigeria has been a member of OPEC since 1971. There are oil refineries at Port Harcourt, Warri, and Kaduna. The petroleum industry remains dominant, and crude petroleum continues to account for virtually all export earnings. The most economically valuable minerals are crude oil, natural gas, coal, tin, and columbite (an iron-bearing mineral that accompanies tin). Petroleum, first discovered in 1956, is the most important source of government revenue and foreign exchange—its share of the gross domestic product rose from virtually nothing in the 1950s to about two-fifths in the late 1990s. Most of the oil output comes from onshore fields in the Niger Delta, although an increasing proportion of the crude is produced at offshore locations. There are vast reserves of natural gas, but most of the gas produced is a by-product of crude oil; in the past, this was burned off, as there was no market for it, but efforts have been made to utilize more of this commodity.
Tourism
In 2005 Nigeria received more than 2.7 million tourists. The largest contingents came from Niger (620,658), Benin (393,215), Liberia (107,401), and Cameroon (107,108). In 2004 tourism receipts totaled US$49 million. The Nigerian government encourages its citizens to visit tourism destinations within the country through various financial incentives. Concerns exist regarding the quality of amenities and personal safety.
Services
Services accounted for an estimated 29.3 percent of the gross domestic product and employed roughly one in five workers in 2006. The most important branch of the services sector is banking and finance. Nigeria has many attractions of interest to tourists. There are miles of coastal beaches, wildlife reserves, a variety of cultures, and many museums that house artistic treasures. However, the many decades Nigeria spent under military rule created a repressive environment not well suited to the tourist. Since the installation of the democratically elected government in 1999, the country has faced periods of ethnic violence, also not conducive to attracting a tourist clientele. Nevertheless, more than two million people visited the country annually in the early 2000s.
Banking and Finance
In 2006 Nigeria’s banking sector successfully completed a consolidation program under the supervision of the Central Bank of Nigeria, which has regulatory authority over the entire financial sector. From a total of 89 banks, many of them marginal, 25 relatively well-capitalized deposit banks have emerged. Even before the consolidation, loan assets and deposit liabilities were highly concentrated. In addition to deposit banks, Nigeria has hundreds of community banks and a small number of specialized development and mortgage banks. A similar consolidation is planned for the insurance sector. In 2007 Nigerian banks such as intercontinental Bank and Guaranty Trust were the beneficiaries of significant foreign investment. Contrary to modern practice, many financial transactions in Nigeria are conducted in cash rather than with bank letters of credit.