Oil 1 Peak Oil 21
NIGERIAN COLLAPSE GUARANTEES SPILLOVER AND ARMED CONFLICT
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- Low oil revenues trigger unemployment
- RANDOM—HIGH OIL PRICES KEY TO NIGERIAN EDUCATION
- THEY SAY—NIGERIA ECONOMY COLLAPSING NOW
- DISAD TURNS CASE—NIGERIAN INSTABILITY TRIGGERS OIL PRICES GLOBALLY
NIGERIAN COLLAPSE GUARANTEES SPILLOVER AND ARMED CONFLICTNigerian collapse would spillover and guarantee multiple scenarios of armed conflict. National Intelligence Council, March, 2005. “Mapping Sub-Saharan Africa’s Failure” http://www.dni.gov/nic/confreports_africa_future.html Other potential developments might accelerate decline in Africa and reduce even our limited optimism. The most important would be the outright collapse of Nigeria. While currently Nigeria's leaders are locked in a bad marriage that all dislike but dare not leave, there are possibilities that could disrupt the precarious equilibrium in Abuja. The most important would be a junior officer coup that could destabilize the country to the extent that open warfare breaks out in many places in a sustained manner. If Nigeria were to become a failed state, it could drag down a large part of the West African region. Even state failure in small countries such as Liberia has the effect of destabilizing entire neighborhoods. If millions were to flee a collapsed Nigeria, the surrounding countries, up to and including Ghana, would be destabilized. Further, a failed Nigeria probably could not be reconstituted for many years—if ever—and not without massive international assistance. While many other downside risks are imaginable given the precarious state of most African countries, the possibility of some type of ecological downturn should be noted. Such a large portion of Africa hovers just above poverty and is still so dependent on the land that the continent is still especially vulnerable to changes in climate or the outbreak of new diseases. There is also the possibility for conflict over water among the ten riparian states that comprise the Nile Basin. The relationship between Ethiopia and Egypt has been tense for years because of water and, if not handled carefully, this issue has the potential to be the next big conflict in Africa. Low oil revenues trigger unemploymentLack of high oil prices cut oil revenues, cutting funding for education and triggering unemployment and failed businesses Biodun Adedipe, Ph.D. Chief Consultant, B. Adedipe Associates Limited, Victoria Island, Lagos, Nigeria, 2004. “THE IMPACT OF OIL ON NIGERIA’S ECONOMIC POLICY FORMULATION” http://www.odi.org.uk/events/nigeria_2004/Adedipe.pdf The decrease in oil revenue affected funding of tertiary education, necessitating a policy shift that has been difficult for the operators of the system to come to terms with. Attempts to raise fees are being resisted, while the private sector funding support that could lessen the burden is not forthcoming. In particular, the curriculum design of many of the institutions is dated and not so relevant to the needs of prospective employers. Most of the products therefore, end up in the labour market and have difficulty securing jobs because they need further training to be able to fit properly into the corporate world. The weak economy itself choked out several business enterprises and curtailed employment opportunities. Staff retrenchment became pervasive, starting first in the private sector and later the public sector. As noted in an earlier section, the unemployment was more problematic in the urban areas, as shown in the following chart. RANDOM—HIGH OIL PRICES KEY TO NIGERIAN EDUCATIONMonetization of oil revenues due to high oil prices boosts Nigerian education Biodun Adedipe, Ph.D. Chief Consultant, B. Adedipe Associates Limited, Victoria Island, Lagos, Nigeria, 2004. “THE IMPACT OF OIL ON NIGERIA’S ECONOMIC POLICY FORMULATION” http://www.odi.org.uk/events/nigeria_2004/Adedipe.pdf The period of easy money (through monetization of oil revenue) was beneficial to the educational system. Nigerian Governments embarked on ambitious expansion programmes in secondary and tertiary education. Quality research could be conducted, as adequate funding support was available. Education was strictly treated as a social service, which should be provided at little or no cost to the beneficiaries as a matter of right. This mindset precipitated the crisis of 1978, when the Federal Government introduced tuition fees in its universities THEY SAY—NIGERIA ECONOMY COLLAPSING NOWNigeria’s econ will keep growing fast if oil prices stay high. Platts Oilgram News 2/6/07 “Oil revenues to boost Middle East, African countries, says S&P report” Lexis [ev] But in real terms, the picture of economic growth is more varied, S&P said. "Of the oil-producing countries, the most robust growth will occur in Qatar and Bahrain," both of which are investing heavily in the non-oil sector, S&P said, noting Qatar would expand LNG production this year while Bahrain would ramp up its aluminum production capacity. The fastest-growing economies in Africa will be Nigeria and Mozambique, said S&P. High oil prices are expected to sustain a strong increase in Nigerian government spending, most of which is being directed toward improving infrastructure. "Fiscal-led growth is thus assured in the medium term, assuming elevated oil prices are sustained and the political environment remains conducive to economic and monetary stability," the report said. Nigerian econ strong—oil prices. Business Monitor International 5/30/08 “Nigeria Attracting Significant Foreign Investment” Lexis [ev] On a positive note, the year 2008 should be a very strong year for Nigeria's economy. We forecast high levels of growth and a record high current account surplus, largely buoyed by our projected high price of oil. High oil prices should also increase foreign reserves, but will also threaten to accelerate inflation. Looking forward we see oil prices slipping past 2008, narrowing the country's current account surplus as large income and service deficits exert major drags, although the country's real GDP growth should be sustained, partially from robust non-oil growth and by increasing private consumption. Econ high—oil and banks. The Banker 5/1/07 “Team Of The Month - Merrill Emerges Triumphant - The Debt Specialists At Merrill Lynch  Have Been Busy Blazing New Trails In The Emerging Markets. Edward Russell-Walling Reports” Lexis [ev]
If the Georgian issue was relatively straightforward, the Merrill team displayed its talent for hard work to better effect with BB-/B+ rated First Bank of Nigeria. Like Georgia, Nigeria's is an economy that is coming good, helped by high oil prices. Per capita GDP is on the up and there has been substantial growth in retail banking. The banking sector has been overhauled, and an original 89 banks have been whittled down into 25 bigger and more sustainable institutions. DISAD TURNS CASE—NIGERIAN INSTABILITY TRIGGERS OIL PRICES GLOBALLYNigerian instability boosts global oil prices USA Today, April 30, 2006, [“Oil from Africa comes with political instability” http://www.usatoday.com/money/world/2006-04-30-africa-oil-usat_x.htm ] A new Bank of America report shows Africa provided more oil to the U.S. market in 2005 than the Middle East.
[“Oil from Africa comes with political instability” http://www.usatoday.com/money/world/2006-04-30-africa-oil-usat_x.htm ] A new Bank of America report shows Africa provided more oil to the U.S. market in 2005 than the Middle East.
. ROBINSON WEST: Well, one of the things that's important to remember, Ray, is that it's a world market. And if the price of oil goes up in Rotterdam, it's going to go up in Houston and Singapore, and that Nigeria is important to the world market. It produces about 2.4 million barrels a day, about 20 percent, about half million barrels have been shut in. But this is important for several reasons. One, they produce light sweet crude, very high quality crude is produced in Nigeria. Secondly, there is almost no excess capacity in the world. Markets are very, very tight. And the third thing is, is that if the market feels that Nigeria is unstable and there could be contagion in the rest of West Africa, then West Africa is becoming very important to the world oil markets as well. Directory: file -> view view -> Western Europe after wwii view -> Author study: paul fleischman view -> Qpa1 7ela study Guide view -> Arctic Oil/Gas Neg view -> November 1970 Approximately 150,000-500,000 deaths Bhola Cyclone Bangladesh view -> Grade Level: 6 Unit of Study: Caribbean glce view -> Citation: Duffield, Katy view -> Table of Contents Lesson # view -> Chinese Wind Energy Disad Download 9.54 Mb. Share with your friends:
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