Oil and natural gas extraction and supply governs the Nigerian industry sectors. The oil sector provides almost 30% of the GDP and accounts for 90% of the total export volume. The non-oil sectors suffer from lack of infrastructure and economic mismanagement.
Nigeria Industry Sectors: History
Till the mid 20th century, Nigeria’s industry sectors were dominated by agricultural production. The country’s fertile land and abundant mineral resources drove the economy. However, the 1970s oil boom changed the entire equation. The oil sector became the mainstay of the economy. As foreign currency began to pour in through the oil sector, the government neglected the agriculture and non-oil industrial sectors. Massive migration from villages to oil-producing cities resulted in large unemployment and low standard of living.
Major Nigeria Industry Sectors
The mining sector, including the oil and natural gas segment, is the largest Nigeria industry sector. According to the 2005 figures, it accounts for more than 90% of the annual national production and generates more than 80% of the government revenues. The country produces 2.169 million barrels per day (2007 statistics). In terms of oil export volumes, the country ranks 8th in the world. The Nigerian oil sector is regulated by the Nigerian National Oil Corporation (NNOC). It is a member country of the Organization of Petroleum Exporting Countries (OPEC). Although major reforms have been undertaken to liberalize the country's economy, the oil sector is still under the close scrutiny of the government.
While, the oil sector is the major source of revenue for Nigeria, it is also central to civil unrest and border disputes. For long-term growth, the government has to strategically plan to develop the non-oil industries in the region.
Other major industrial sectors in Nigeria are:
Telecommunication: In the economic reforms of 2005, the government laid huge emphasis on improving the telecommunication sector. The Nigeria Communications Commission has the responsibility to develop mobile and internet communication facilities in the country.
Mining: The non-oil mining sector is yet to be developed completely to contribute towards national production. The country has significant reserves of coal, iron, gold, uranium and tantalum.
The manufacturing, construction and chemical sectors are also gradually shaping up after the 2005 economic reforms.