Following the alarming increase in cases of oil theft and drop in oil revenue, African Development Bank (AfDB) Group yesterday expressed worry over its economic effect on the nation.
The bank also took a look at the insecurity challenges in the country especially in the North East as it is capable of dampening the positive socio-economic outlook of the nation.
In its African Economic Outlook 2014 Report, which was launched in Abuja, the report, covering 54 African countries highlighted the current state of economic and social development, as well as prospects for countries in the continent.
The report, which showed the worrisome level of disruption in oil production and lifting operations occasioned by multiple leaks, pipeline vandalism and theft, concluded that the country’s economy was on the downward plunge.
The document also listed the sluggish recovery of the global economy, continued agitation for resource control in the Niger Delta region, and likely distraction as a result of the 2015 general elections, as other factors that may affect the performance of the economy.
It stated that while prospects in the country were driven by performance in the activities in the non-oil sector such as agriculture, information and communications technology, trade and services, the recent decline in oil production had become worrisome.
“Growth of the oil sector was hampered throughout 2013 by supply disruptions arising from oil theft and pipeline vandalism and by weak investment in upstream activities with no new oil finds. Risks to Nigeria’s economic growth are sluggish recovery of the global economy, insecurity challenges in the northeastern part of the country, continued agitation for resource control in the Niger Delta and possible distraction from the ongoing reforms as a result of the upcoming 2015 general elections. Negative growth of the oil sector may also continue to drag down overall growth until a lasting solution is found to the challenge of oil theft and weak investment in exploration due to uncertain state of play in the sector as a result of non-passage of the Petroleum Industry Bill (PIB),” it said.
Explaining further, the report said the country is still facing the challenge of making its decade-long sustained growth more inclusive.
“Poverty and unemployment remain prominent among the major challenges facing the country. One reason for that is that the benefits of economic growth have not sufficiently trickled down to the poor,” it said. Earlier, the Country Director of the AfDB, Mr. Ousmane Dore, said that despite the challenges facing the country, social indicators are beginning to improve as efforts to achieve the Millennium Development Goals (MDGs) have been intensified through the implementation of social-sector reforms.
“We believe that monetary policy has been successful because the country’s inflation rate currently stands at single digit. But there is need to put in place policies that will help address poverty to match the tremendous growth which Nigeria had recorded in recent times,” he said.
In his remarks, Director General, Budget Office of the Federation, Dr. Bright Okogu, admitted some of the challenges facing the country but noted, however, that the Federal Government was currently addressing most of the issues raised in the report.

Oil theft: AFDB raises alarm over nation’s economic prospects