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PROFILEfrom U.S. Department of State
www.state.gov
Official Name:
Federal Republic of Nigeria
Geography:
Area: 923.8 thousand sq. km. (356,700 sq. mi.) about the size of California, Nevada, and Arizona.
Cities: Capital--Abuja (pop. est. 452,000). Other cities--Kano (9.3 million), Lagos (9.01 million), Ibadan (5 million), Enugu (500,000).
Terrain: Ranges from southern coastal swamps to tropical forests, open woodlands, grasslands, and semi-desert in the far north. The highest regions are the Jos Plateau 1,200-2,400 meters above sea level and the mountains along the border with Cameroon.
Climate: Annual rainfall ranges from 381 cm. along the coast to 64 cm. or less in the far north.
People:
Nationality: Noun and adjective--Nigerian(s).
Population (2006 est.): 140 million.
Total fertility rate (avg. number of children per woman): 5.7.
Ethnic groups (250): Hausa-Fulani, Igbo, Yoruba, and Ijaw are the largest.
Religions: Muslim, Christian, indigenous African.
Languages: English (official), Hausa, Igbo, Yoruba, Fulani, Ijaw, others.
Education: Attendance (secondary)--male 32%, female 27%. Literacy--39%-51%.
Health: Life expectancy (2004 est.)--43.7 years.
Government:
Type: Federal republic.
Independence: October 1, 1960.
Constitution: The 1999 constitution (based largely on the 1979 constitution) was promulgated by decree on May 5, 1999 and came into force on May 29, 1999.
Subdivisions: 36 states plus Federal Capital Territory (Abuja); states divided into a total of 774 local government areas.
Total government expenditure (2006 budget): $14 billion.
Defense: 4.5% of 2006 budget.
Economy:
GDP (2005 est.): $99.0 billion.
Estimated real growth rate (2005 est.): 6.9%.
Per capita GDP (2005 est.): $694.
Inflation (2006): 8%.
Natural resources: Petroleum, natural gas, tin, columbite, iron ore, coal, limestone, lead, zinc.
Agriculture: Products--cocoa, palm oil, yams, cassava, sorghum, millet, corn, rice, livestock, groundnuts, cotton.
Industry: Types--textiles, cement, food products, footwear, metal products, lumber, beer, detergents, car assembly.
Trade (2005): Exports--$59 billion: petroleum (95%); cocoa; rubber. Partners--United States (52.5%); Spain (8.2%); Brazil (6.1%). Imports--$25 billion: machinery; chemicals; transport equipment; manufactured goods; food; live animals. Partners--China (10%); United States (7.3%); United Kingdom (6.7%).
PEOPLE
The most populous country in Africa, Nigeria accounts for over half of West Africa's population. Although less than 25% of Nigerians are urban dwellers, at least 24 cities have populations of more than 100,000. The variety of customs, languages, and traditions among Nigeria's 250 ethnic groups gives the country a rich diversity. The dominant ethnic group in the northern two-thirds of the country is the Hausa-Fulani, most of whom are Muslim. Other major ethnic groups of the north are the Nupe, Tiv, and Kanuri. The Yoruba people are predominant in the southwest.
About half of the Yorubas are Christian and half Muslim. The predominantly Catholic Igbo are the largest ethnic group in the southeast, with the Efik, Ibibio, and Ijaw (the country's fourth-largest ethnic group) comprising a substantial segment of the population in that area. Persons of different language backgrounds most commonly communicate in English, although knowledge of two or more Nigerian languages is widespread. Hausa, Yoruba, Igbo, Fulani, and Ijaw are the most widely used Nigerian languages.
ECONOMY
Trade:
Nigeria is the largest U.S. trading partner in sub-Saharan Africa, based mainly on the high level of petroleum imports from Nigeria. Total two-way trade was valued at $30.8 billion in 2006, a 19% increase over 2005. Leading U.S exports to Nigeria were machinery, wheat, and motor vehicles. Leading U.S. imports from Nigeria were oil and rubber products. Nigerian exports to the United State under the African Growth and Opportunity Act (AGOA), including its Generalized System of Preferences (GSP) provisions, were valued at $25.8 billion during 2006, a 15% increase over 2005, due to an increase in oil exports. Non-oil AGOA trade (leather products, species, cassava, yams, beans, and wood products) totaled $1.4 million in 2006, almost double the amount in 2005. The United States was the largest foreign investor in Nigeria.
In June 2006, the United States met with Nigeria under the existing Trade and Investment Framework Agreement (TIFA) to cooperate on investment issues and to develop a strategy for Nigeria to diversify its export base, especially in manufactured goods. Under the TIFA, the United States and Nigeria pledged to work together on critical issues such as World Trade Organization (WTO) Doha Development, intellectual property rights, and trade capacity building.
The U.S. goods trade deficit with Nigeria was $25.7 billion in 2006, an increase of $3 billion from $22.6 billion in 2005. U.S. goods exports to Nigeria in 2006 were $2.2 billion, up 38% from the previous year. U.S. imports from Nigeria were $27.9 billion in 2006, up from 15% from 2005. Nigeria is currently the 50th-largest export market for U.S. goods.
The stock of U.S. foreign direct investment (FDI) in Nigeria in 2005 was $874 million, down from $2.0 billion in 2004. U.S. FDI in Nigeria is concentrated largely in the mining and wholesale trade sectors.
The United States is Nigeria's largest trading partner after the United Kingdom. Although the trade balance overwhelmingly favors Nigeria, thanks to oil exports, a large portion of U.S. exports to Nigeria is believed to enter the country outside of the Nigerian Government's official statistics, due to importers seeking to avoid Nigeria's excessive tariffs. To counter smuggling and under-invoicing by importers, in May 2001 the Nigerian Government instituted a 100% inspection regime for all imports, and enforcement has been sustained. On the whole, Nigerian high tariffs and non-tariff barriers are gradually being reduced, but much progress remains to be made. The government also has been encouraging the expansion of foreign investment, although the country's investment climate remains daunting to all but the most determined. The stock of U.S. investment is nearly $7 billion, mostly in the energy sector. Exxon-Mobil and Chevron are the two largest U.S. corporate players in offshore oil and gas production. Significant exports of liquefied natural gas started in late 1999 and are slated to expand as Nigeria seeks to eliminate gas flaring by 2008.
One of Nigeria's greatest success stories has been the completion in early 2006 of a major overhaul of its banking system, although some have criticized the pace of consolidation and aggressive CBN supervision. Reforms have reduced the number of banks from 89 to 25, increased a bank's minimal capital requirement to $190 million, and required banks to hold 40% of their deposits in liquid assets. Retail, corporate, and Internet banking are seen as intensively competitive, and the home loan market is considered moderately competitive. Less than 10% of lending is believed to be made to individuals. About 65% of the economically active population is serviced by the informal financial sector, e.g., microfinance institutions, moneylenders, friends, relatives, and credit unions. Since 1999, the Nigerian Stock Exchange has enjoyed strong performance, although equity as a means to foster corporate growth remains underutilized by Nigeria's private sector. Rural communities remain largely unbanked, the real estate sector and small businesses receive a low level of lending, and the credit card market remains at an early stage of development.
Gradual Reform:
Nigeria made progress toward establishing a market-based economy in 2006. It privatized Nigeria Telecommunications and its mobile subsidiary as well as the only government-owned petrochemical company. The government also sold its interest in eight oil service companies. Nigeria continued implementation of the Economic Community of West African States (ECOWAS) Common External Tariff. Nigeria's implementation of non-tariff barriers has been arbitrary and uneven and continues to violate WTO prohibitions against trade bans. However, the government removed some textile items from its list of prohibited imports in 2006. Enforcement of criminal penalties against intellectual property rights (IPR) violations is weak, and firms that are successfully countering IPR piracy have generally done so through civil court cases. The government has recently created an intellectual property commission.
A co-member of the International Advisory Group of the Extractive Industries Transparency Initiative (EITI) initiated by the G8, Nigeria's federal government is playing an important role in having volunteered to pilot the new disclosure and validation methodologies. It has completed a comprehensive audit of oil sector payments and government revenues from 1999-2004. However, it is perceived that government contracting remains rife with corruption and kickbacks, and that many state and local officials continue to steal public monies outright.
Nigeria's economic team has enjoyed an excellent reputation in the international community. The team produced an encouraging body of work, notably budgets described as "prudent and responsible" by the IMF and a detailed economic reform blueprint, the National Economic Empowerment and Development Strategy (NEEDS). Other positive developments have included: (1) government efforts to deregulate fuel prices; (2) Nigeria's participation in the EITI and commitment to the G8 Anticorruption/Transparency Initiative; (3) creation of an effective Economic and Financial Crimes Commission (EFCC), which has earned 150 convictions and recovered over $5 billion in mishandled funds; and (4) development of several governmental offices to better monitor official revenues and expenditures.
Nigeria is not on track to meet its Millennium Development Goals because of a lack of policy coordination between the federal, state, and local governments, a lack of funding commitments at the state and local levels; and a lack of available staff to implement and monitor projects on health, poverty, and education.
Investment:
Although Nigeria must grapple with its decaying infrastructure and a poor regulatory environment, the country possesses many positive attributes for carefully targeted investment and will expand as both a regional and international market player. Profitable niche markets outside the energy sector, such as specialized telecommunication providers, have developed under the government's reform program. There is a growing Nigerian consensus that foreign investment is essential to realizing Nigeria's vast potential. Companies interested in long-term investment and joint ventures, especially those that use locally available raw materials, will find opportunities in the large national market. However, to improve prospects for success, potential investors must educate themselves extensively on local conditions and business practices, establish a local presence, and choose their partners carefully. The Nigerian Government is keenly aware that sustaining democratic principles, enhancing security for life and property, and rebuilding and maintaining infrastructure are necessary for the country to attract foreign investment.
U.S.-NIGERIAN RELATIONS
The U.S. has a very strong relationship with Nigeria. The Nigerian government has lent strong diplomatic support to U.S. Government counter-terrorism efforts in the aftermath of the September 11, 2001 terrorist attacks. The Government of Nigeria, in its official statements, has both condemned the terrorist attacks and supported military action against the Taliban and Al Qaida. Nigeria also has played a leading role in forging an anti-terrorism consensus among states in Sub-Saharan Africa. An estimated one million Nigerians and Nigerian Americans live, study, and work in the United States, while over 25,000 Americans live and work in Nigeria.
With the nullification of Nigeria's June 12, 1993, presidential election, and in light of human rights abuses and the failure to embark on a meaningful democratic transition, the United States imposed numerous sanctions on Nigeria. After a period of increasingly strained relations, the death of General Abacha in June 1998 and his replacement by General Abubakar opened a new phase of improved bilateral relations. As the transition to democracy progressed, the removal of visa restrictions, increased high-level visits of U.S. officials, discussions of future assistance, and the granting of a Vital National Interest Certification on counter-narcotics, effective in March, 1999, paved the way for re-establishment of closer ties between the United States and Nigeria as a key partner in the region and the continent. Since the inauguration of the Obasanjo government, the bilateral relationship has continued to improve, and cooperation on many important foreign policy goals, such as regional peacekeeping, has been excellent.
For more information about Nigeria, please visit the U.S. Department of State at
http://www.state.gov/r/pa/ei/bgn/2836.htm
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