The twists and turns of the global oil economy are having extraordinary consequences for Africa’s oil states. Angola’s gross domestic product (GDP) in 1998 was $11 billion; the estimate for 2007 is $80 billion. Nigeria’s equivalent figures are $106 billion and $294 billion and the picture is similar, if on a smaller scale, for oil states such as Gabon, Republic of Congo, Equatorial Guinea and Chad.
From Ricardo Soares de Oliveira writing in BBC Focus on Africa.
See also some research on the possible impacts on women’s rights, democracy and civil war by UCLA’s Michael Ross.
This may not be pretty. Especially if prices should plummet back down, as commodity prices are wont to do. Anyone remember the Lost Decade?
2 Responses
To say that Nigeria has significant new resources available due to high oil prices seems inaccurate to me. Despite the huge increase in oil prices recently, Nigeria’s GDP growth is being driven by non-oil growth. In fact, oil gdp growth was negative in both 2006 and 2007, thanks to insecurity in the Delta reducing crude production. Consolidated govt oil revenues actually dropped in nominal terms in 2007 from 2006.
This in no way meant to defend the waste of government resources in Nigeria, particularly by the state governments (who get around 40% of total government oil revenues).
I mostly agree, but the fundamentals of oil make the price look very unlikely to collapse anytime soon. There just isn’t enough of it and there ain’t gonna be.
However, I’d like to see Africa diversify into the concentrated solar market more. They have the best resource in the world (and consequently a nearer par price for investment with other energy sources) and an opportunity to foster a vital industry before others have really got a handle on it. The technology isn’t radically complicated and there is the opportunity for massive exports (as well as internal dissemination) of the most important requirement for modern life – energy. Check out TREC and Desertec for more detailed proposals.