Beyond Rebasing, The Nigerian Economy Has Changed
By ‘Tope Fasua
Well, the world economy has changed in a remarkable manner. The advent of COVID-19 marked a radical shift to the dominance of the digital economy especially. In that era, the uber-rich grew even indeterminably richer, while more poverty was manufactured around the world – especially in areas where modern, Western education is rife and the idea of a digital economy, powered by the ubiquitous internet, is still a distant contemplation. Those are the people – mostly in the global South – who carried the can, even as the top digital entrepreneurs tripled their fortunes in less than three years of global despair and its aftermath. If the pandemic had lasted a little while longer, and the lockdowns weren’t resisted strongly in some quarters, it would have become easier for the very well-to-do in every distant country to order their daily groceries from Tesco, Marks & Spencer, Target and Walmart, than to buy from their struggling nearby corner shops. In fact, the small mom and pop shops would have wholly disappeared.
Artificial Intelligence gained more currency in that era, at the turn of this decade, and has only now taken on a life of its own, revealing new daily capabilities which strike fear into the hearts of many human beings. As millions continue to learn around the world, huge socioeconomic schisms are appearing. Many jobs will go – inevitably. For now, most bosses really no longer need to get someone else to draft their speeches. Presentations are so easy to do in very little time. Proposals, business plans, even bid documents, are much more easier for AI to put together. Businesses really no longer need human beings to respond on their behalf, as chat bots now do a much better job. Like the job of typists disappeared about 30 years ago, something even more profound is afoot.
So, the global economy has changed, and the symptoms are the more concentration of production in the hands of fewer large conglomerates. Small businesses are being squeezed out. The Chinese bested everyone else in terms of production capacity, causing Donald Trump to panic. He’s now seeking to bring back some industries and jobs to the US, with marginal success thus far. Other top countries are trying to create formidable economic unions – like the BRICS – to whittle down the American influence. Europe seems a bit lost – with very little in terms of response to the innovative behemoths coming out of China and the USA, especially in the digital space. Africa is scrambling to see what it can make of its own trade agreement – the AfCFTA – in a new world where there are no assurances anywhere, and where everyone seems to be on their own.
Many economies in the developed world have plateaued. But a cursory glance at our economy reveals vast potentials in every space, which can be easily harnessed. This is why I am unafraid of high ambitions for the Nigerian economy, in terms of growth and sustainable, inclusive development. I believe we should continue to set the bar high, for as they say, those who shoot for the skies sometimes find themselves among the stars.
Well, the world economy has changed in a remarkable manner. The advent of COVID-19 marked a radical shift to the dominance of the digital economy especially. In that era, the uber-rich grew even indeterminably richer, while more poverty was manufactured around the world – especially in areas where modern, Western education is rife and the idea of a digital economy, powered by the ubiquitous internet, is still a distant contemplation. Those are the people – mostly in the global South – who carried the can, even as the top digital entrepreneurs tripled their fortunes in less than three years of global despair and its aftermath. If the pandemic had lasted a little while longer, and the lockdowns weren’t resisted strongly in some quarters, it would have become easier for the very well-to-do in every distant country to order their daily groceries from Tesco, Marks & Spencer, Target and Walmart, than to buy from their struggling nearby corner shops. In fact, the small mom and pop shops would have wholly disappeared.
Artificial Intelligence gained more currency in that era, at the turn of this decade, and has only now taken on a life of its own, revealing new daily capabilities which strike fear into the hearts of many human beings. As millions continue to learn around the world, huge socioeconomic schisms are appearing. Many jobs will go – inevitably. For now, most bosses really no longer need to get someone else to draft their speeches. Presentations are so easy to do in very little time. Proposals, business plans, even bid documents, are much more easier for AI to put together. Businesses really no longer need human beings to respond on their behalf, as chat bots now do a much better job. Like the job of typists disappeared about 30 years ago, something even more profound is afoot.
So, the global economy has changed, and the symptoms are the more concentration of production in the hands of fewer large conglomerates. Small businesses are being squeezed out. The Chinese bested everyone else in terms of production capacity, causing Donald Trump to panic. He’s now seeking to bring back some industries and jobs to the US, with marginal success thus far. Other top countries are trying to create formidable economic unions – like the BRICS – to whittle down the American influence. Europe seems a bit lost – with very little in terms of response to the innovative behemoths coming out of China and the USA, especially in the digital space. Africa is scrambling to see what it can make of its own trade agreement – the AfCFTA – in a new world where there are no assurances anywhere, and where everyone seems to be on their own.
Nigeria’s economy is also changing. And we must take notice. The Nigerian economy is also a living and breathing organism, despite the famous cynicism of the people. The economy will change and is changing in spite of what most Nigerians think about it. We have a dynamic economy, which changes so fast that many times we do not notice its rapidity, and tend to take it for granted. In Nigeria – and a number of developing countries, especially in Africa – there is good reason to expect an upward trajectory of growth for as far as the eyes can see. Many economies in the developed world have plateaued. But a cursory glance at our economy reveals vast potentials in every space, which can be easily harnessed. This is why I am unafraid of high ambitions for the Nigerian economy, in terms of growth and sustainable, inclusive development. I believe we should continue to set the bar high, for as they say, those who shoot for the skies sometimes find themselves among the stars.
Now, let us look at some profound changes in the Nigerian economy, post-COVID, especially in the last two years since President Bola Ahmed Tinubu took the reins and bravely instituted reforms that are designed to exorcise the country of some gruesome demons that have held us down:
1. Petroleum Sector: There are a number of fundamental changes that have occurred in this sector. The headline changes include the takeover of the assets of some of the global oil companies by local consortia. Seplat is the new Mobil. Renaissance is the new Shell. MRS Oil has taken over most of Chevron’s downstream assets, while OANDO took over Agip. This is good for Nigeria, as our people have gained considerable control of our most important resource, proving ourselves worthy, turning good profits, creating employment opportunities for Nigerians and consolidating on positions by proving doubters wrong.
This is a story that hasn’t been told properly, but I understand that it is better to show results than obsess with the optics. Dozens of Nigerian companies now play solidly in the oil sector, from Elumelu’s Heirs Holdings, to Adenuga’s Conoil, Ogbechie’s Rainoil, Professor Adegbulugbe’s Green Energy and many more, apart from hundreds in the oil servicing space. The great Dangote has basically transformed the downstream sub-sector, bringing in 4,000 trucks for local distribution from his world-beating refinery. Four remarkable metrics have redefined this sector in recent times:
(a) Nigeria has become a net importer of crude oil from the United States, with Dangote importing about 10 million barrels monthly from the US and a few other countries. A US-based news site noted that this is the first time such is happening since 1973. A role reversal. Nigeria used to export all its crude to the USA.
(b) According to a report in the 4 June edition of The PUNCH, Nigerian indigenous producers now account for more than 50 per cent of Nigeria’s crude oil production. Wow! The companies are mentioned above. This is another great reversal from the time when that sector was totally dominated by foreign companies, with NNPC, our local behemoth, not pulling its weight per se.
(c) Nigeria is flipping the script in terms of import and export. The 2024 Import and Export numbers, according to Trading Economics, show that Nigeria’s import of petroleum gas and related products dropped from about $21 billion in 2023 to $10 billion in 2024. On the export side, because Nigeria has to now feed its local refineries, our export of crude oil fell marginally from $59 billion in 2023 to $46 billion in 2024. Both numbers – the import and export of crude oil – are projected to tend towards zero, as Nigeria fully feeds local refineries with all its production, once short and mid term agreements have been vitiated with counterparties, and as Nigeria’s local refineries produce first for the local economy, while exporting the rest.
(d) Nigeria has also become an exporter of refined fuel, with Dangote supplying jet fuel to the USA, Saudi Arabia and some South American nations. This is only the beginning. May I add that Nigeria is now determining, more accurately, the quantum of its local consumption of petrol fuel, from the 90 million claim of June 2019, which I still remember very well, to a 33 million standard over the past few months. Nigeria is finally extricating itself from the mind-boggling fraud and extirpation of its precious monetary resources by a few carpetbaggers. Again, kudos to Mr President. It is only a matter of months before Nigerians start seeing a positive change in their fortunes for good. Already, many Nigerians are seeing this, even though they may decide to hush their good fortunes. People who play in sectors where they can adjust prices in line with inflation and maintain patronage are indeed smiling to the bank, literally. The economy has changed.
Many economies in the developed world have plateaued. But a cursory glance at our economy reveals vast potentials in every space, which can be easily harnessed. This is why I am unafraid of high ambitions for the Nigerian economy, in terms of growth and sustainable, inclusive development. I believe we should continue to set the bar high, for as they say, those who shoot for the skies sometimes find themselves among the stars.
Well, the world economy has changed in a remarkable manner. The advent of COVID-19 marked a radical shift to the dominance of the digital economy especially. In that era, the uber-rich grew even indeterminably richer, while more poverty was manufactured around the world – especially in areas where modern, Western education is rife and the idea of a digital economy, powered by the ubiquitous internet, is still a distant contemplation. Those are the people – mostly in the global South – who carried the can, even as the top digital entrepreneurs tripled their fortunes in less than three years of global despair and its aftermath. If the pandemic had lasted a little while longer, and the lockdowns weren’t resisted strongly in some quarters, it would have become easier for the very well-to-do in every distant country to order their daily groceries from Tesco, Marks & Spencer, Target and Walmart, than to buy from their struggling nearby corner shops. In fact, the small mom and pop shops would have wholly disappeared.
Artificial Intelligence gained more currency in that era, at the turn of this decade, and has only now taken on a life of its own, revealing new daily capabilities which strike fear into the hearts of many human beings. As millions continue to learn around the world, huge socioeconomic schisms are appearing. Many jobs will go – inevitably. For now, most bosses really no longer need to get someone else to draft their speeches. Presentations are so easy to do in very little time. Proposals, business plans, even bid documents, are much more easier for AI to put together. Businesses really no longer need human beings to respond on their behalf, as chat bots now do a much better job. Like the job of typists disappeared about 30 years ago, something even more profound is afoot.
So, the global economy has changed, and the symptoms are the more concentration of production in the hands of fewer large conglomerates. Small businesses are being squeezed out. The Chinese bested everyone else in terms of production capacity, causing Donald Trump to panic. He’s now seeking to bring back some industries and jobs to the US, with marginal success thus far. Other top countries are trying to create formidable economic unions – like the BRICS – to whittle down the American influence. Europe seems a bit lost – with very little in terms of response to the innovative behemoths coming out of China and the USA, especially in the digital space. Africa is scrambling to see what it can make of its own trade agreement – the AfCFTA – in a new world where there are no assurances anywhere, and where everyone seems to be on their own.
Nigeria’s economy is also changing. And we must take notice. The Nigerian economy is also a living and breathing organism, despite the famous cynicism of the people. The economy will change and is changing in spite of what most Nigerians think about it. We have a dynamic economy, which changes so fast that many times we do not notice its rapidity, and tend to take it for granted. In Nigeria – and a number of developing countries, especially in Africa – there is good reason to expect an upward trajectory of growth for as far as the eyes can see. Many economies in the developed world have plateaued. But a cursory glance at our economy reveals vast potentials in every space, which can be easily harnessed. This is why I am unafraid of high ambitions for the Nigerian economy, in terms of growth and sustainable, inclusive development. I believe we should continue to set the bar high, for as they say, those who shoot for the skies sometimes find themselves among the stars.
Now, let us look at some profound changes in the Nigerian economy, post-COVID, especially in the last two years since President Bola Ahmed Tinubu took the reins and bravely instituted reforms that are designed to exorcise the country of some gruesome demons that have held us down:
1. Petroleum Sector: There are a number of fundamental changes that have occurred in this sector. The headline changes include the takeover of the assets of some of the global oil companies by local consortia. Seplat is the new Mobil. Renaissance is the new Shell. MRS Oil has taken over most of Chevron’s downstream assets, while OANDO took over Agip. This is good for Nigeria, as our people have gained considerable control of our most important resource, proving ourselves worthy, turning good profits, creating employment opportunities for Nigerians and consolidating on positions by proving doubters wrong.
Nigeria is flipping the script in terms of import and export. The 2024 Import and Export numbers, according to Trading Economics, show that Nigeria’s import of petroleum gas and related products dropped from about $21 billion in 2023 to $10 billion in 2024. On the export side, because Nigeria has to now feed its local refineries, our export of crude oil fell marginally from $59 billion in 2023 to $46 billion in 2024.
This is a story that hasn’t been told properly, but I understand that it is better to show results than obsess with the optics. Dozens of Nigerian companies now play solidly in the oil sector, from Elumelu’s Heirs Holdings, to Adenuga’s Conoil, Ogbechie’s Rainoil, Professor Adegbulugbe’s Green Energy and many more, apart from hundreds in the oil servicing space. The great Dangote has basically transformed the downstream sub-sector, bringing in 4,000 trucks for local distribution from his world-beating refinery. Four remarkable metrics have redefined this sector in recent times:
(a) Nigeria has become a net importer of crude oil from the United States, with Dangote importing about 10 million barrels monthly from the US and a few other countries. A US-based news site noted that this is the first time such is happening since 1973. A role reversal. Nigeria used to export all its crude to the USA.
(b) According to a report in the 4 June edition of The PUNCH, Nigerian indigenous producers now account for more than 50 per cent of Nigeria’s crude oil production. Wow! The companies are mentioned above. This is another great reversal from the time when that sector was totally dominated by foreign companies, with NNPC, our local behemoth, not pulling its weight per se.
(c) Nigeria is flipping the script in terms of import and export. The 2024 Import and Export numbers, according to Trading Economics, show that Nigeria’s import of petroleum gas and related products dropped from about $21 billion in 2023 to $10 billion in 2024. On the export side, because Nigeria has to now feed its local refineries, our export of crude oil fell marginally from $59 billion in 2023 to $46 billion in 2024. Both numbers – the import and export of crude oil – are projected to tend towards zero, as Nigeria fully feeds local refineries with all its production, once short and mid term agreements have been vitiated with counterparties, and as Nigeria’s local refineries produce first for the local economy, while exporting the rest.
(d) Nigeria has also become an exporter of refined fuel, with Dangote supplying jet fuel to the USA, Saudi Arabia and some South American nations. This is only the beginning. May I add that Nigeria is now determining, more accurately, the quantum of its local consumption of petrol fuel, from the 90 million claim of June 2019, which I still remember very well, to a 33 million standard over the past few months. Nigeria is finally extricating itself from the mind-boggling fraud and extirpation of its precious monetary resources by a few carpetbaggers. Again, kudos to Mr President. It is only a matter of months before Nigerians start seeing a positive change in their fortunes for good. Already, many Nigerians are seeing this, even though they may decide to hush their good fortunes. People who play in sectors where they can adjust prices in line with inflation and maintain patronage are indeed smiling to the bank, literally. The economy has changed.
2. There is also the intervention of financial technology, otherwise known as FINTECH. I watched a remarkable documentary the other day, shot by Moniepoint, one of Nigeria’s fintech successes. It is basically about how the company’s very lithe technology is enabling farmers and traders to easily receive payments in the remotest parts of the country, and to avoid the risk of lumbering cash. The setting of the documentary is in Maiduguri and its environs. The traders and farmers have been able to avoid the hassle of dealing with traditional banks – which they say intimidated them in the first place. What makes this remarkable is that the velocity of money has increased in the country as a result of this development. As I keep saying, we must note that after pain comes ease.
Even the very adventurous change of currency by the former governor of the CBN is part of what accelerated the adoption of alternative