OAM4J:

No the money exists, they are with the farmers. The farmers use the money to sustain themselves and their families. These farmers are not being paid by the government with Abuja oil money. Let us even agree that Borno State Govt cannot pay his civil servants without oil money from Abuja, the question is; what is the % of the civil servants of Borno State to the whole population of Borno State? Now you will understand why Agriculture is the major source of income of Borno people because the earn/feed/survive more income from Agriculure than from Abuja oil money.

It is money from allocations from oil that builds roads, schools, hospitals and a vast and assorted array of other services. Farmers benefit directly from oil money, as does every person living within the borders of Nigeria.

J12: The Statistics bureau is trying to play to the gallery with economic facts and data.
If agriculture is the major contributor to our GDP, how come the north (a predominantly agrarian zone) is wallowing in poverty when compared to the south?

Because GDP is totally different from wealth and income.

All these ones wey una dey make na noise. The day the FOREX from oil goes down that day una go know say Somalia be like Washington D.C.

He wey get ear make e listen.

Billyonaire: Some people dont know about GDP, even the meaning of GDP, they just wanna put mouth in arguments.

You are the one that is ignorant of the meaning of GDP and the interpretation of GDP data, that is why you think the data is wrong. No economist has claimed the data is wrong.

J12: The Statistics bureau is trying to play to the gallery with economic facts and data.
If agriculture is the major contributor to our GDP, how come the north (a predominantly agrarian zone) is wallowing in poverty when compared to the south?

1. It isn't the statistics bureau alone who has produced this estimate. Various other sources have similar #s.
2. How is your second statement a contradiction?

manny4life:
VERY INCORRECT @ the bold. Dr NOI, reduced recurrent to about 54%, increased Cap Exp to about 28%, and statutory allocation was about 9%.

If you close the oil wells tomorrow, how will Nigeria pay her bills? Including subsidy?

The moment that Nigeria can't pay her bill, the govt will literally shut down, which will affect not some, BUT ALL NIGERIANS.

We've other sectors to fall back on - the wholesale and retail sector generate more money than oil... And there's NO subsidy on oil, we pay almost the same money for oil - as people in neighbouring countries without oil.

Close the oil pumps, and let the big for nothing government shut down - Nigerians are not benefiting anything from oil... Only the cabals in Abuja benefit from it..

shymmex:

We've other sectors to fall back on - the wholesale and retail sector generate more money than oil... And there's NO subsidy on oil, we pay almost the same money for oil - as people in neighbouring countries without oil.

Close the oil pumps, and let the big for nothing government shut down - Nigerians are not benefiting anything from oil... Only the cabals in Abuja benefit from it..

Jeez! Who's this guy?!

OAM4J:

What is the basis for export if not to generate foreign exchange for import?

You are the one that needs to grab the understanding of GDP components. The data is right!

And yes there are lots more prospects in agriculture for the future than oil. Agriculture more than oil will rule future economy. Go and study why many countries outside Africa are investing and grabbing lands across Africa.

What you are talking id off the thread. Read the topic again and tell me what the major "source of income" is, Hearing you mention this, makes me lose faith in you. Dont disappoint people who sent you to school

where are the roads and infrastructures?

Where are the schools?

Where the medical centres?

Oil money, oil money - where is this oil money?

shymmex:

We've other sectors to fall back on - the wholesale and retail sector generate more money than oil... And there's NO subsidy on oil, we pay almost the same money for oil - as people in neighbouring countries without oil.

Close the oil pumps, and let the big for nothing government shut down - Nigerians are not benefiting anything from oil... Only the cabals in Abuja benefit from it..

No they don't generate more money than oil. According to NBS, and the Ministry of Finance, OIL earnings represent about 72% of Nigeria's income. So if you shut down the oil wells and Nigeria doesn't export her 2.2million barrels x $72 benchmark price, Nigeria will not finance capital expenditure, social causes etc. Everything will be on stand still.

OAM4J:

What is the basis for export if not to generate foreign exchange for import?

You are the one that needs to grab the understanding of GDP components. The data is right!

And yes there are lots more prospects in agriculture for the future than oil. Agriculture more than oil will rule future economy. Go and study why many countries outside Africa are investing and grabbing lands across Africa.

They do so because they are running out of arable farm lands, not for GDP reasons.

all4naija: Are you serious?! The Nigerian National Bureau of Statistics must be missing it. It is the total value of goods and services which have been produced in the country for a given period of time. This is related to the national account under macroeconomics.

Indeed, the value(not volume - which I think the NBS of Nigerian is using) of Oil products contribution to the nation production at a certain period of time supersede that of Agriculture, even though, it employs the largest part of the population and production volume.

The body needs to re-examine/review their statistics correctly. The last time I checked oil still contributed well above 79% value of goods and services, the GDP of Nigeria!

If oil contributes 79% - how come a state like Lagos without oil contributes a staggering 18% of Nigeria's GDP?

79% claim is ludicrous..

I'll get the break down of the GDP now - I've got a link for it.

J12: The Statistics bureau is trying to play to the gallery with economic facts and data.
If agriculture is the major contributor to our GDP, how come the north (a predominantly agrarian zone) is wallowing in poverty when compared to the south?

Because agriculture does not significantly contribute to develpment in Nigeria. Few people beyond farmers actually benefit from agriculture. That you can manage to eat some number of times a day from stuff you get from your farm or the small money you get from selling your produce does not translate to wealth, just survival. The south has industry ranging from finance to, to oil and gas, to manufacturing (the reasons are even more than that). To make this whole thing fair I think the federal government should start taxing more industries and getting revenue from that too which should be shared among all states like currently for oil, since we don't seem to be heading towards this so called "federalism"

shymmex: where are the roads and infrastructures?

Where are the schools?

Where the medical centres?

Oil money, oil money - where is this oil money?

Come on. Is this really your argument now? Money is far from used efficiently but most governments that are actually working have used it. Infrastructure in pretty much ALL northern states and most southern states have been built by oil money.

Lagos also benefits hugely from oil. The Lagos government taxes companies and rightly so. And there are a good number of oil and gas companies in Lagos that pay taxes and hires people who pay taxes.

I have questions for those who believe that oil represents an overwhelming fraction of Nigeria's GDP.

1. What fraction of Nigeria's GDP does the oil sector represent, in your estimation? 10%? 20%? 90%?
2. How big do you think Nigeria's GDP is? A rough estimate will do.

Once someone answers these questions, we can do some reasoning and see how good these estimates are.

ballabriggs:

I'm sorry but you have not spoken like you understand the issue.

Firstly, the CBN supplies forex for imports. Where does it get that from, it gets it from the reserves. What happens if the reserves are depleted? It means Nigeria would not be able to meet its import requirements. What follows, scarcity of basic consumer goods, inflation, further depletion of the reserves created by the inflationary pressure. It becomes a never ending vicious cycle.


In the case of Argentina like you mentioned, they pegged their currency and it was overvalued thus leading to a depletion of the reserves. This meant more borrowing to shore up the reserve to meet import requirements. However, inflationary pressure meant a further depletion of the reserves and thus a slide in the value of the peso. What subsequently followed was a dollarization to solve the crisis.
Zimbabwe was under a lot of sanctions and it found it difficult to earn FOREX through its exports. Massive depletion of the reserves and then it ended up with a dollarization.

Don't be deceived take away crude oil and Nigeria is doomed.

So basically, all countries only earn forex from trade; if we follow that line of reasoning what happens to countries that have negative trade deficits? If a country is importing more than it is exporting, where is it getting its forex from if forex is only gotten from trade? Which then leads to the next issue you raised, depletion of reserves and then inflation, dollarization etc.

Since we know that a majority of nations run deficit trade balances, shouldn't a majority of nations have some form of economic crisis if we follow your argument?

With regards to Argentina, its problems were caused by pegging, high levels of debts and reduced income from exports as a result of the overvalued Peso. Governments don't borrow to shore up reserves; in fact, no one will lend you money to shore up your reserves.

See below

'The Argentine economic crisis during the early 2000’s was the result of a decision, by one of their presidents named Carlos Menem (1991), to peg the Argentine Peso to the U.S. Dollar. The reason for this was to produce financial stability for his country by placing a one-to- one parity between the two currencies. Another factor that contributed to this turmoil was the fact that the government controlled the flow of currency based on inflow of U.S. Dollars that came from investments and so the Argentine economy accelerated at a much faster pace than anticipated. The unregulated currency became overvalued thus putting their country at a disadvantage by making their exports more expensive and forcing them to import more goods. The situation only worsened when the local governments kept spending money frivolously without regard as to how much they were borrowing. Within time the government saw it necessary to reduce the amount of spending to reduce the amount of imports they country bought and to keep the level of debt small but by that time it was too late.'

http://www.thecsem.org/content/argentine-currency-crisis

shymmex: where are the roads and infrastructures?

Where are the schools?

Where the medical centres?

Oil money, oil money - where is this oil money?

Lol... What about important finished goods and other services like the ones by experts,etc whose value is 5x higher? I think you don't see to the mechanism that is working invisibly to make the economy move at all in it sluggish state in Nigeria. If not sluggish would be obviously exaggerated as too good for Nigeria condition.

Beaf:

If oil disappears, Nigeria will simply crumble into the new Somalia.

Yes, people survived for centuries before oil, many by chasing wild animals on foot, fighting with tigers and climbing trees to harvest palmnuts etc. Those were the days when you simply threw away your twins (instead of bothering with extra mouths) and trekked from Lagos to Sokoto to sell crocodiles and salt (as a wealthy business person). It surely was great time with a life expectancy of maybe 25 years.

Nigeria has not grown technologically since those days and oil is our life support system. Take it away, and its back to Tarzan time.

LMAO

Don't mind these disciples of the "national bureau of statistics".
When they open pages of newspapers and see. . .

* FAAC unable to share allocation due to lack of funds
* State Governors sue FG over non payment of 3 month allocation
* FG to scrap LGA's
* ASUU embarks on indefinite strike over non payment of salaries
* NUT embarks on indefinite strike
* . . . Doctors threaten indefinite if salary demands are not met
* FG: We can no longer subsidize petroleum products
* NLC on strike over planned removal of fuel subsidy
* Nigeria for sale

One has to go to DUBAI to see where OIL MONEY is put to good use by HUMAN BEINGS!!! when ANIMALS have oil, NIGERIA is what happens!

Beaf:

If oil disappears, Nigeria will simply crumble into the new Somalia.

Yes, people survived for centuries before oil, many by chasing wild animals on foot, fighting with tigers and climbing trees to harvest palmnuts etc. Those were the days when you simply threw away your twins (instead of bothering with extra mouths) and trekked from Lagos to Sokoto to sell crocodiles and salt (as a wealthy business person). It surely was great time with a life expectancy of maybe 25 years.

Nigeria has not grown technologically since those days and oil is our life support system. Take it away, and its back to Tarzan time.

LMAO

shymmex: where are the roads and infrastructures?

Where are the schools?

Where the medical centres?

Oil money, oil money - where is this oil money?

Now I know why Beaf says nobody should you serious since you haven't been Nigeria before. This says it all

Beaf:

It is money from allocations from oil that builds roads, schools, hospitals and a vast and assorted array of other services. Farmers benefit directly from oil money, as does every person living within the borders of Nigeria.

Was expecting you and someone to come up with this question.

How many of the roads, schools and hospitals are functioning despite the oil money? Assume government refuses to spend a dime of oil on those things, you think majority of Nigerians will not survive?

Last time I checked, majority of Nigerians pay for their education, health, water even for their security.

Mind you I have not said or indicated that oil contributed nothing; my argument is on the side of the OP that oil is not the major source of income for the 150million Nigerians and tough it may be, but majority of Nigerians will survive without oil. This remain my argument.

shymmex:

If oil contributes 79% - how come a state like Lagos without oil contributes a staggering 18% of Nigeria's GDP?

79% claim is ludicrous..

I'll get the break down of the GDP now - I've got a link for it.

If really as you said Lagos contributes a staggering 18% to the nation GDP then you must ask yourself if the people of that state are doing that through Agriculture. Indeed, the state contribution could as well boils down to oil and other sources!

Please, do! Most statistics are poorly placed into scheme of things in Nigeria.

- According to the World Bank and DFID, Lagos’ 2009 GDP is estimated at N4.163tn. Lagos which is a mega-city is the largest contributor to the national GDP at 18%.

Rank State GDP (PPP$)
1 Lagos State 33,679,258,023
2 Rivers State 21,073,410,422
3 Delta State 16,749,250,544
4 Oyo State 16,121,670,484
5 Imo State 14,212,637,486
6 Kano State 12,393,103,864
7 Edo State 11,888,446,884
8 Akwa Ibom State 11,179,887,963
9 Ogun State 10,470,415,017
10 Kaduna State 10,334,763,785
11 Cross River State 9,292,059,207
12 Abia State 8,687,442,705
13 Ondo State 8,414,302,623
14 Osun State 7,280,597,521
15 Benue State 6,864,209,262
16 Anambra State 6,764,219,562
17 Katsina State 6,022,655,197
18 Niger State 6,002,007,080
19 Borno State 5,175,165,142
20 Plateau State 5,154,059,937
21 Sokoto State 4,818,615,261
22 Bauchi State 4,713,858,180
23 Kogi State 4,642,794,262
24 Adamawa State 4,582,045,246
25 Enugu State 4,396,590,769
26 Bayelsa State 4,337,065,923
27 Zamfara State 4,123,829,498
28 Kwara State 3,841,827,534
29 Taraba State 3,397,790,217
30 Kebbi State 3,290,847,166
31 Nassarawa State 3,022,828,885
32 Jigawa State 2,988,014,405
33 Ekiti State 2,848,372,512
34 Ebonyi State 2,732,472,739
35 Gombe State 2,500,467,306
36 Yobe State 2,011,499,081
- FCT 5,010,968,012

Do the maths! - the oil producing states are in bold..

Bear in mind that oil isn't the only source of GDP for some of the oil producing states.

I'm gonna break this into little chunks for those who do not understand.

1. Oil accounts for 80% of the FG's earnings.
2. The FG sustains all states with oil awuf.
3. State and LG allocations go toward waterworks, education, roads, hospitals, bridges, waterways, salaries, amenities etc.

Without oil money, no portion of the country would have enough money for waterworks, education, roads, hospitals, salaries, amenities etc etc. farm money cannot build these things, cos the farmers are already half dead from hunger, exhaustion and deprivation. I hope its now understood?

Very simplistic, but spot on.

Now let's get a lil practical . . . .Can the proponents of those hilariously seeking to make us believe that Agric has benefitted the economy more than the drive of oil please answer the questions below

1) What will happen if the FG with holds the monthly allocation to the states . . . . can Agriculture salvage the impending disaster that will follow it . . .

2) why do Agric based traders groan, whenever there is a delay in paying the civil servants . . .You hear complains like this === > "Government no gree release money" . . .Why are they so dependent on Gov releasing their oil money to make ends meet . . .

What visible developmental gains has the populace enjoyed largely from the revenue from the agric sector . . .

It's a fact that without the monthly allocation from the FG to the states . .people especially the farmers groan citing bad market

ekt_bear: I have questions for those who believe that oil represents an overwhelming fraction of Nigeria's GDP.

1. What fraction of Nigeria's GDP does the oil sector represent, in your estimation? 10%? 20%? 90%?
2. How big do you think Nigeria's GDP is? A rough estimate will do.

Once someone answers these questions, we can do some reasoning and see how good these estimates are.

Naira has no value. How much do you think those goods and services carried out within the country worth?!

all4naija: Naira has no value. How much do you think those goods and services carried out within the country worth?!

Of what relevance is the Naira in this. OK, what of yam. Or pure water. Or a man laboring 12 hours a day, 360+ days a year. Do these things have economic value to you?

Or are they all worthless, and only oil is of value?

Beaf: I'm gonna break this into little chunks for those who do not understand.

1. Oil accounts for 80% of the FG's earnings.
2. The FG sustains all states with oil awuf.
3. State and LG allocations go toward waterworks, education, roads, hospitals, bridges, waterways, salaries, amenities etc.

Without oil money, no portion of the country would have enough money for waterworks, education, roads, hospitals, salaries, amenities etc etc. farm money cannot build these things, cos the farmers are already half dead from hunger, exhaustion and deprivation. I hope its now understood?

Very simplistic, but spot on.

Thank you!
I don't understand what's so difficult to understand here; I guess in the 2013 budget, govt should scrap away Agriculture, Education, Transportation, Healthcare budget so that Nigerians can pay from their own pockets. After all, they're already doing so anyways.

all4naija: So would you estimate oil at 100% then of Nigeria's GDP? Name some numbers, let's get something concrete from you.

Sky Blue:

Because agriculture does not significantly contribute to develpment in Nigeria. Few people beyond farmers actually benefit from agriculture. That you can manage to eat some number of times a day from stuff you get from your farm or the small money you get from selling your produce does not translate to wealth, just survival. The south has industry ranging from finance to, to oil and gas, to manufacturing (the reasons are even more than that). To make this whole thing fair I think the federal government should start taxing more industries and getting revenue from that too which should be shared among all states like currently for oil, since we don't seem to be heading towards this so called "federalism"

If agriculture is the major contributor to our GDP and we are not reaping its benefits like we benefit from oil, then why and how is it a major contributor?

Although I must say that OIL represents about 15% of Nigeria's GDP, however, oil represent about 72% of Nigeria's revenues which is what pays her bills. Without revenues, you cannot pay the bills. Please people, yall should stop mixing up Oil's contribution to economic development with Oil as a form of revenue factor. These two are very different.