Measurement and Testing
What is Nigeria's Zero-Oil Plan?
Nov 21 2017 Comments 0
Reaping the country's highest earnings, the Nigerian National Petroleum Company (NNPC) is a bona fide cash cow. However, with the Zero Oil Agenda looming it could soon lose its crown. Designed to phase out oil as Nigeria's staple source of income, the Zero Oil Agenda will drastically reshape the national economy.
Nigeria set to sever ties with global crude market
Currently, Nigeria's markets are intrinsically tied to the performance of the world crude oil market. While in the past this has been been beneficial, the West African nation was forced into recession during the global oil price crash. This saw Nigerian oil revenues collapsed by a huge US$100 billion between 2015 and 2017, reigned in only by OPEC's agreement to lower output by 1.2 million barrels per day. It was then plagued with a sluggish recovery thanks to the slow rebound in oil prices.
Nigerian’s reliance on crude oil is so lucid that in a recent World Bank executive summary analysts stated “Nigeria depends on exports of crude oil for approximately 70 percent of government revenue and 90 percent of foreign exchange earnings.”
With experts warning that oil demand could reach a climax in just 30 years, the pressure is on to fast-track economic diversification strategies.
Nigeria targets exports
In response, Nigeria has launched an ambitious Zero Oil Agenda. According to the National Economic Council Nigeria will increase total non-oil government revenues by fivefold over a currently unspecified timeline. This will see external markets increase from US$5 billion to US$25 billion. Exports are a major target, with the Nigerian Export Promotion Council (NEPC) pledging to boost key crops such as rice, wheat, corn, palm oil, rubber, sugar and soya beans.
Nigeria on track for social reform
Locals are behind the shift, maintaining that over the past decade Lagos and Abuja have monopolised Nigerian oil profits. Meanwhile, residents living near major oilfields have been left to struggle on the lowest rungs of the socioeconomic ladder.
General Segun Awolowo, Director of the Nigerian Export Promotion Council has confirmed that the nation is moving forward with the Zero Oil Agenda and hopes to make significant progress over the next 10 years. Ultimately, the plan could boost Nigeria’s foreign reserves by US$150 billion and create 500,000 new jobs. Analysts also predict that it could pull 10 million Nigerian citizens out of poverty.
Of course, Nigeria's oil industry is no stranger to corruption. This means its refineries are under constant scrutiny. For a close look at the techniques used to monitor quality in the oil industry don't miss 'VUV PIONA+ Improves Accuracy of Hydrocarbon Reporting in Gasoline.'
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