Why Nigerian Economy is on the brink!

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October 7, 2013   //

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The magnitude of crude oil theft in Nigeria can be described as sustaining a booming enterprise save for its illegality and negative impact on the nation’s economy, as it has become a national malady which has continued to affect companies and states around the world even as a report from UK Think Tank shows. According to the UK based Think-Tank report, which was based on interviews with some 200 government, private sector and independent sources, “Nigerian crude oil is being stolen on an industrial scale.”Estimates on the scale of the problem vary, with some Nigerian officials saying 150,000 barrels per day is stolen, costing some $6 billion a year in lost revenue. The UK based body, Chatham House, also reviewed thousands of documents, in which it said the figure was almost certainly more than 100,000 barrels per day. According to the Chatham reports, Nigeria is Africa’s largest oil producer, with output at around 2.0 million barrels per day.The report also stated that “Proceeds are laundered through world financial centres and used to buy assets in and outside Nigeria,” even as it said that only a few fully grasp the problem and those affected have shown little desire to act. “In Nigeria, politicians, military officers, militants, oil industry personnel, oil traders and communities profit,” Chatham House said.For Nigeria, cracking down could inflame tensions among powerful figures, particularly in the southern oil-producing Niger Delta region, where unrest declined after a 2009 amnesty deal with rebels, but where stability remains elusive.Despite rhetoric about the scourge of oil theft from Western governments and foreign oil majors, neither camp has fully attacked the problem, the report said.There is “very little incentive for foreign partners to act, including risk of a diplomatic rift and almost no leverage,” in part because …

Source: Desert Herald

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