By Gilbert Obaseki
Nigeria remains a mono economy to this day, heavily reliant on oil. One fundamental question continues to echo in my mind: What have we done with the billions of dollars we have earned from oil over the years?
Looking back, during President Obasanjo’s tenure, oil prices ranged from as low as $14 to about $30 per barrel, rising to around $60 towards the end of his administration. Despite the modest prices by today’s standards, his government managed to leave behind around $65 billion in external reserves, paid off foreign debts, and saved billions more in the Excess Crude Account. He also initiated several key infrastructure projects, including the controversial power plants.
Fast forward to President Jonathan’s era , his administration foresaw economic vulnerability and pushed to save more aggressively. They channeled oil revenues into the Excess Crude Account with the intention of building a Sovereign Wealth Fund. We all remember Dr. Ngozi Okonjo-Iweala’s public outcry when attempts were made to raid those savings. The states insisted the funds be shared. Now, the pressing question is: What value has emerged in the states from those disbursed funds?
Contrast this with Norway, which established her Government Pension Fund Global in 1990. That fund has grown to over $1.7 trillion today. Norway understood the need to prepare for the future to save, invest, and protect their economy for generations to come.
In Nigeria, we tend to react to crises instead of planning ahead. Right now, oil prices hover around $65 per barrel, aided by the ongoing war in Ukraine and the sanctions on Russia. But is that what we are relying on? Are we praying for conflicts to continue just so we can benefit economically? What happens if the U.S. and Iran strike a deal and Iran floods the oil market? Or if the U.S. returns to “drill, baby, drill” policies? Oil prices will crash and where will that leave us?
Unless we get serious and diversify our economy, we are simply treading water. Oil has not been the blessing we hoped for in many ways, it has held us back. Perhaps Nigeria might have fared better without oil at all.
