An Emerging Economy in Nigeria Assignment.
The heightened non-uniformity in the economies of most developing nations is the
driving force towards the rapid progression to achieving globalization. The different levels of
success in African nations when it comes to the financial market, currency ratings as well as
revenues and incomes are what makes one country more economically stable than the next.
Nigeria is one of the countries in Africa which is known to enjoy a stable and robust economy.
Its Gross Domestic Product coupled with its high population are contributing factors towards its
rich economy. At the same time, Nigeria prides itself in controlling a vast oil industry as well as
a thriving manufacturing sector. An Emerging Economy in Nigeria Assignment. This country is said to enjoy an emerging economy because it is one of the regions across the globe that has experienced a very fast pace when it comes to
industrialization. Moreover, the latter process has occurred under conditions of restricted or
limited assistance from external allies. This means that Nigeria qualifies to be one of the
countries with a rapidly growing economy, owing to its increased earnings on local, regional and
international business activities. This paper is a comprehensive essay that provides a vivid
elucidation of the reasons that make Nigeria one of the countries with an emerging economy. An Emerging Economy in Nigeria Assignment.
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a) Basic Facts On The Economy Of Nigeria
The process of restructuring the financial accounts of Nigeria are enough proof that the
country is indeed enjoying a fast rate of economic growth. The telecommunication sector as well
as the agricultural industries has been able to place the Nigerian economy at more than ten
billion dollars. These statistics were extrapolated in the year 2013 and by this time, Nigeria had
already been ranked as one of the countries with the largest economy in Africa. This means that
it takes over from countries like South Africa, Zambia and Malawi that are also known to have strong and robust economies as well. The Gross Domestic Product or GDP of Nigeria at a per
capacita level is estimated to be close to 3,000 dollars. If this is translated into a percentage, then
it would be rebased at a level of around 7.5%.
The oil industry is one of the largest contributors towards the growth of the Nigerian
economy. This sector alone is able to bring in an annual income of 6.4% from its sale of oil and
gas alone. An Emerging Economy in Nigeria Assignment.Economists and market experts have forecasted the growth of this sector and shown that
it is anticipated to rise to at least 6.9% within the next year. The high prices of oil within the
global market combined with an increasing import sector has helped Nigeria to benefit
immensely from the sale of oil and its by-products. In fact, oil revenues have since increased
significantly such that there was more inflow of capital from the sale of oil to foreign countries
and reserves. The ruling presidents and leaders of Nigeria have always been determined to
ensure that a significant level of effort is placed towards the reduction of poverty.
For instance, Goodluck Jonathan is one of the presidents who is fondly celebrated for
devoting a large amount of resources towards the construction and development of key infrastructure. The latter is very instrumental towards the growth of any economy because it
ensures roads, railways, communication and social amenities are properly assembled, built and
maintained. In Nigeria, the process of constructing power plants and roads both attracted up to
8.1% in terms of budget allocation within the last year alone. This was a sharp increase from the
previous year where the same sectors were only given a meager 4.5% . An Emerging Economy in Nigeria Assignment.
Figure 2: Graph showing the Gross Domestic Product or GDP of Nigeria in comparison to
other African countries within a 24-year period
The year 2015 has witnessed an increase in the amount of money allocated towards the
development of infrastructure in Nigeria. The total amount is approximated to be close to 400
billion and it was channeled towards the transport, aviation, communication and agricultural
sectors. This explains why Nigeria is currently regarded as a fast growing economy, both in
Africa and in the world. An Emerging Economy in Nigeria Assignment.
Financial experts have shown that Nigeria is in fact the third country in the world that has
a rich economy. It comes in this position after China and Mongolia that enjoy Gross Domestic
Product or GDPs of 8.6% and 15% respectively. The greatest share of Nigeria’s income is
mainly earned through the heavy reliance on crude oil. However, this reliance has since been
diversified to incorporate other industries such as agriculture, manufacturing and commerce so
that fiscal sustainability can be enhanced. An Emerging Economy in Nigeria Assignment.
b) The Importance Of Emerging Economies To Developing Countries: Case Study Of
Nigeria
The growing popularity and acceptance of emerging economies is being largely
experienced in the countries that consider themselves the key players driving the global
economy. According to research, emerging economies comprise 80% of the entire human
population across the world. Nigeria is one such country that contributes to this high percentage
because it has been marked as one of the areas with huge potential for growth. The rapid
urbanization combined with the massive migration of people from rural to urban settings are
some of the effects that come with the expansion of an economy.Urban cities and towns are known to be metropolitan in nature such that they prove
opportunities for employment, better standards of living as well as investment. An Emerging Economy in Nigeria Assignment. This is currently
being experienced in Nigeria where people are constantly migrating to urban towns where there
are more industries, companies and offices that can offer decent employment. Moreover, the
manufacturing and oil industries have been established and set up in the municipal areas and
regions where the state of roads, communication, technology and innovation is at its peak.
Consequently, Nigeria is also able to enjoy affordable manpower from the people who relocate
to look for jobs in the cities. In fact, research shows that metropolitan areas such as those in
Nigeria are closely associated with emerging economies due to the fast rate of industrialization.
Additionally, Nigeria also accounts for the cumulative 40% of the global GDP where the
purchasing power and parity in trade is of utmost importance. What’s more, the market value of
shares, stocks and products traded within Nigeria also gains considerably, thanks to its rich
economy. An Emerging Economy in Nigeria Assignment.
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For this reason, Nigeria enjoys an emerging economy that makes it the driving engine of
its own internal growth. This is thanks to the investment opportunities, commerce, technology
and communication present within the country. Hence, its emerging economies allow markets to
expand so that they can serve as an outlet for the channelling of more revenue and establishment
of entrepreneurial ventures. An Emerging Economy in Nigeria Assignment.
c) The Rising Industries That Contribute To An Emerging Economy In Nigeria
The prominent international funding bodies such as the World Bank and Interational
Monetary Fund or IMF have described Nigeria as one of the countries to watch out for when it
comes to economic growth. The reason for this is that this African country is constantly enjoying
investments that are lucrative while at the same time expanding exponentially. In addition, the
capital markets of Nigeria have been growing steadily while its natural resources have been
exploited to benefit the entire population. The presence of free markets in this African country
allows foreigners to invest in equity shares of the public, statutory and even private companies
and corporations. The bulk of Nigeria’s revenue is mainly earned or recovered from a combination of industries which include the housing, agricultural, tourism, power and
transportation sectors. In addition, the oil sector also provides a chunk of revenue that is then
driven towards the overall national income.
Essentially, this means that the potential of the market within Nigeria is extremely high
such that there are numerous opportunities when it comes to trade, business and even the
establishment of entrepreneurial ventures. However, it is indisputable that the crude oil industry
has brought worldwide attention to Nigeria. Thanks to this industry, numerous countries have
been able to establish trade agreements and bilateral contracts that extend to a number of years.
Nigeria is the largest exporter of oil to developed nations such as America, where crude oil is
sold to cater for the needs of millions of citizens in this state as well as drive machinery in
industries. An Emerging Economy in Nigeria Assignment.
Nigeria also boasts of having an emerging economy in the sense that the rate of growth
of most business activities is placed at 8% over a five year period. Essentially, this means that
new businesses are being established every year and they contribute a lot towards the revenue
and income tax collected. Moreover, it also means that the small and micro-enterprises are able
to thrive in Nigeria because the policies and framework that governs business and banking is
flexible enough to incorporate the needs of everyone. Additionally, Nigeria also enjoys more
foreign investment that stems from the bilateral export agreement between the United States and
Nigeria. In fact, America is the largest investor within Nigeria and is known to fund various
industries such as the communication, information and processing sectors. The petroleum
industry provides at least 85% of the budged revenue collected within Nigeria.
Consequently, this has also expanded the economic activities that rely heavily on oil.
Moreover, the government of Nigeria is also able to enjoy more surpluses that are realized from either production, manufacture or processing industries. The diversification of economic
activities is what enables foreigners to have an interest of investing in this emerging economy.
There are a number of companies and corporations in Nigeria that exist purely put of
partnerships with foreign countries. Lucrative organizations have been able to network with the
local or indigenous brokerage firms that in turn provide valuable information on the best places
to invest. The latter can take the form of building or constructing a firm, or trading in stocks and
shares. Hence, being an emerging economy for Nigeria means that there are added advantages
when it comes to moving high up the ladder in business and commerce. An Emerging Economy in Nigeria Assignment.
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The financial market is the key beneficiary of this expanding economy in the sense that it
encourages more repatriation of funds from businesses that are set up overseas as well as an
influx of income from Nigerians living in the diaspora. Moreover, the state of this financial
system encourages the local citizens to invest in their own country so that they can also be part f
their country’s success. Indeed, Nigeria has managed to provide great and grand potential for
profit in its quest to remain one of the emerging economies within the global scale.
Conclusion
Nigeria is one of the few African countries that flies high on the flag of emerging
economies and diversified trade. The numerous opportunities that are present within this nation
signify the potential that it holds towards transforming the lives if its citizens through trade and
commerce. Nigeria is known to have a very robust crude oil and petroleum industry that is also
harnessed by additional industries such as processing, commerce, production and even
manufacture. The statistics of the Gross Domestic Product or GDP of Nigeria indicate that they
have been increasing on an annual basis. Moreover, the presence of foreign investors also allows
this state to grow its economic activities in leaps and bounds. The inclusion of foreign investors, international companies, multinationals and the combination of these with the local entrepreneurs
blends well with the commerce sector of Nigeria. It is anticipated that this country will continue
to become an emerging economy and narrow the gap that exists between it and established states
such as China and America. An Emerging Economy in Nigeria Assignment.