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Inflation Rate of Nigeria (1960-2016




His decision to annul a 1993 election won by Moshood Abiola throws the country into a political crisis and forces his resignation. and nation or world body. Some of these communities still suffer environmental degradation. institutional changes in the economy and structural shifts in production. which leads to deprivation of means of livelihood and other economic and social factors. there was a high inflation rate due to the political crisis experienced by the country. As a result of volatility in rates. there was a high inflation rate due to the increase in cost/price of the oil product. Crude oil discovery has had certain impacts on the Nigeria economy both positively and adversely. During this year. During that time. Violent clashes between Muslims and Christians increase dramatically when Nigeria registers as a member of the Organization of the Islamic Conference in 1986. the inflation rate of Nigeria 2 . During this year. Involvement here refers to being a member of an organization. by vote.17%. the inflation rate of Nigeria is too high and it is considered as a highest inflation rate of Nigeria with the 72. Ibrahim Babangida assumes power in 1985 with an empty promise to return Nigeria to civil rule. Oil being the central component of Nigerian economy that plays a vital role in shaping the economic destiny of the country. this can be considered with the respect to the surrounding communities within which the oil wells are exploited. electoral reform is an exercise that calls for the best hands and experts in the field of politics but the voting system is not smoothly organized due to the political issues of both representative. In Nigeria. just like everyone other nation. Economic Analysis on Inflation Oil is a major source of energy in Nigeria and the world in general. Election is a process of choosing. the reaffirmation of the illegality of the parallel market and the discontinuation of open accounts and bills for collection as means of payments sectors. By this issues. During this year. These included the formal pegging of the naira exchange rate. the inflation rate of Nigeria becomes higher with the percentage of 57. state. further reforms were introduced in the Foreign Exchange Market in 1994. On the negative side. During 1995. the centralization of foreign exchange in the CBN.84%. the evolution of the foreign exchange market in Nigeria up to its present state was influenced by a number of factors such as the changing pattern of international trade. the restriction of Bureaux de Change to buy foreign exchange as agents of the CBN. By this issues. a community. a representative of the people who are involved.

All of this significant peaks of Nigeria as to relate to Inflation rate. It has been established that scarcity in the official sector and necessitated the growth and development of parallel market. crude oil brings a negative impact due to the misappropriation of public funds. In this economic analysis. the nation has a difficulty in maintaining the price stability and the available resources are low due to the increase of unemployment regarding in producing goods and services. The FX Market Rules has witnessed tremendous changes.03%. the society and the people itself suffered from environmental degradation and the growth and development of Nigeria is extremely low.becomes higher with the percentage of 57. Part of the citizens of Nigeria. the electoral reform didn’t monitor properly since there are political issues between the two candidates that greatly affects the public trust. there was a high inflation rate due to the evolution of the foreign exchange market in Nigeria. we can empirically verify that the impact of crude oil on the Nigerian economy has had a positive impact on the economic growth in Nigeria but it’s not significantly improved the growth of economy due to many factors like corruption and poor administration. 3 . During this year. Foregoing.

org 4 .org https://freedomhouse.fairobserver. Unemployment Rate of Nigeria (1960-2016) 25 20 15 10 5 0 60 962 964 966 968 970 972 974 976 978 980 982 984 986 988 990 992 994 996 998 000 002 004 006 008 010 012 014 016 19 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2 2 Unempl oyment Rate Sources: https://www.

Most of the 36 state governments of the federation are unable to pay salaries regularly. raising fears that the country will struggle to have its first peaceful transfer of power from one civilian government to another. Nigeria’s oil production has dropped to 1.90%.65m barrels a day because of the resurgence of militant activity in the southerly Delta region for the lowest output in 22 years. Nigeria’s government has been facing mounting pressure both 5 . Due to this issue. during 2003. the economy will have less income which would result to lower demand on goods and services. There was a high unemployment rate due to the increasing political violence in Nigeria. This group attacked the oil systems in Nigeria which resulted to a worst economic crisis in the country since. Thus. oil is their highest output of production. Economic Analysis on Unemployment Political violence escalated in Nigeria in the run-up to presidential and legislative elections scheduled for 2003. the total population of Nigeria decreased due to the increasing political violence during the election. The uptick in unrest in the Delta–and the impact on oil production–comes as the Muhammadu Buhari administration is confronting the worst economic crisis in decades due to the oil price collapse. The government has planned to reopen it but it is not clear if repairs have started. there was a decrease on it since large number of employees lost their jobs and became unemployed. Hence. the inflation rate will also decrease due to these circumstances. the production of oil began sliding in February when a new militant group calling itself the Niger Delta Avengers claimed an attack on an underwater pipeline running that forced Royal Dutch Shell to shut down its Forcados export terminal. In 2008. the oil production of Nigeria intensely decreased due to the attacks of the militants called the Niger Delta Avengers. This issue affected the regularly pay of salaries to the employee. In relation to the inflation rate. This economic issue led to high unemployment rate since the labor force decreased.80%. Thus. the unemployment rate of the country increased to 14. In relation to the inflation rate. Due to this event.000 bpd. The federal government faced international criticism about harsh sentences handed down by Sharia (Islamic law) courts in the north of the country. the unemployment rate of Nigeria is high which has a rate of 14. knocking off at least 250. if the number of unemployed population increase then. A voter registration exercise held in September was disastrous. In 2003. large number of labor force lost their jobs. The new group has vowed to bring Nigeria’s oil output to zero. Boko Haram has waged an increasingly bloody insurgency since 2009 in an attempt to create an Islamic state in Nigeria.

this terrorist group attempted to create an Islamic State which resulted to the mounting pressure encountered by the government of Nigeria. Thus. Nigeria gained a high unemployment rate because of the economic crisis. Because of the fear and disruptions caused by the terrorists to the citizens and its home and abroad to do more to tackle the group and bring about the release of more than 300 schoolgirls kidnapped by the group on April 15. and has been. in this sense. During the year 2009. Since unemployment rate is usually used to measure the health and wealth of the economy of a nation. The inflation rate this year was low. President Jonathan originally declared a state of emergency in the three northern states where Boko Haram is. Most of the issues which caused this crisis was because of the terrorist groups who attacked and pressured the people in Nigeria especially its government. The worst economic crisis in Nigeria greatly affect the economy as a whole. This issue’s effect was poverty and lack of education. Politics. corruption should be completely eliminated from the system to pave way for the creation of jobs in the country. 6 . since the unemployment rate of Nigeria this year was the highest rate which is 19. most active. Then. Like the year 2008. the problem with poverty and lack of education in the country will also be solved. In result of the pressure. Boko Haram strike by stepping up its bombing campaign in cities and launching mass attacks on small towns and villages. Nigeria’s presidents declared a state of emergency. is volatile to the crisis experienced by the country. the Nigerian citizens also experienced violence from the Islamic group. large number of the population were unemployed. particularly due to the intense decrease of the oil production in the country.

Foreign Direct Investment. net inflows as % of GDP (1960-2016) 12 10 8 6 4 2 0 60 962 964 966 968 970 972 974 976 978 980 982 984 986 988 990 992 994 996 998 000 002 004 006 008 010 012 014 016 19 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2 2 -2 Forei gn Di rect Investment Sources: 7 .

and possibly technology transfer. it also enhances job creation and managerial skills. foreign investors receive largely the same treatment as domestic investors in Nigeria. Measures include devaluing the Naira. That is why. during these periods. slashing public spending. The relative rise in the share of foreign direct investment in capital formation since 1993 has been due to rapid loosening of controls and regulations on the activities of the multinational corporation in Nigeria. Also. deregulation. stimulating exports and the private sector. due to Nigeria’s high FDI in 1989. Privatization in Nigeria during these years. the country’s unemployment rate is within the range of achieving full employment. the high bank lending rate that existed during the early days of deregulation (1987-1990) has affected internal rate of return (IRR) on investment negatively. brought more than nothing but low unemployment rate. demand for goods and services increased which led to the country’s high inflation rate. increase in producers prices and increase in import. and creating the Nigerian Investment Promotion and Commission (NIPC) with mandate to encourage and assist investment in Nigeria. the country’s income also increased. including tax incentives. And since their economy experienced full employment. allowing for 100% foreign ownership in all sectors (with the exception of the petroleum sector. emphasizing economic discipline. and reducing tariffs. thereby boosting investment inflows. 8 . During this period. High foreign direct investment does not only provide developing countries like Nigeria much needed capital for investment. where foreign direct investment is limited to joint ventures or production sharing contracts). During these years. the Nigerian authorities have been trying to attract foreign direct investment via various reforms including the deregulation of the economy and the new industrial policy of 1989 in Nigeria. removing import licences. not government to dictate the economic environment. opening nearly all sectors to foreign investment. the Nigerian Investment Promotion Commission (NIPC) Act dismantled years of controls and limits on foreign direct investment (FDI). Economic Analysis on Investment The World Bank-sponsored Structural Adjustment Program (SAP) is launched. According to Ajakaiye (1995). SAP allows market forces. and austerity. export rates and ultimately inflation rate.

Due to neglecting the oil and gas sector or the agricultural sector in Nigeria during this period. The resulting effect is the large number of job seekers who have no place in the oil industry. In 2009. the said country must also strengthen its political institution to sustain on-going democratic process. led to country’s low income. fostering linkages and local industrial capacity. it must increase its investment for the development of the country’s infrastructure. In order for Nigeria to attract more foreign direct investment. and lastly. This high unemployment rate in Nigeria during 2009. the United Nations Council on Trade and Development (UNCTAD) published an investment policy review of Nigeria and a Blue Book on Best Practice in Investment Promotion and Facilitation. The deregulation policies of the Nigerian economy particularly through reduction in government intervention or interference in economic activities have encouraged and boost foreign direct investment inflows in various sectors in the Nigerian economy. taking advantage of regional integration and reviewing external tarrifs. 9 . Based on the graph presented about the Foreign Direct Investment of Nigeria. investing in physical and human capital. they must also further deregulate the country’s economy through privatization and reduction of government intervention in economic activities. the employment capacity is very low. reduced demand for goods and services and ultimately led to decrease of the country’s inflation rate. the said country must expand its GDP through production incentives. it can be observed that the said country had experienced declining and fluctuating foreign investment inflows. and strengthening institutions dealing with investment and related issues. Policy design narrowed the scope for FDI and decades of political instability. The policy review identified Nigeria’s need to diversify FDI away from oil and gas sector by improving the regulatory framework. economic mismanagement and widespread corruption reduced Nigeria’s ability to attract and retain FDI.

org 10 .opendataforafrica.m. GDP Growth Rate with Business Cycle in Nigeria (1960-2016) Sources: http://nigeria.

When per capita income probably dropped slightly. because Biafra was advancing much more because of their connections with external forces. and trade with the rest of Nigeria has been greatly reduced. Industries dependent on imports generally have ceased production. Exports have virtually ceased. closes places of employment. the inflation rate is quite high. This in turn leads to a fear of association with others and reduces labor force participation. Because of the civil war. His main focus is to point out the lessons that the country learned during the war. Economic Analysis on Business cycle Trough to Expansion Stage. In 1967-1969. Nigeria’s economic growth rate declined. The country needed to create their own resources to provide better living situations and better protection rather than only relying on other countries to give them what they needed. the level of economic activity has obviously declined sharply since the start of the Nigerian Civil War. This lead to the increase of savings and investment and lead to an increase in economic growth Trough to Expansion Stage. inflation rate slipped down due to some factors like the decrease in the unemployment rate of Nigeria. Peak Stage. the analysis finds that the largest economic effects of the crisis are not as a result of the direct costs (mortality. They began to understand that they needed to learn the importance of propaganda. disrupts transportation. In the recent history of infectious disease outbreaks such as the SARS epidemic of 2002-2004. morbidity. There is low unemployment rate in the year 1970 so in application of the Philipps curve. and the associated losses to working days) but rather those resulting from aversion behavior driven by fear of contagion. The civil war helped the government realize what they needed to fix in their policies to make them a stronger country individually and internationally. the analysis notes that behavioral effects have been responsible for as much as 80–90% of the total economic impact of the epidemics. The findings of the analysis underline the need for a concerted international 11 . Nigeria began to revise their foreign policy after the civil war. and motivates some government and private decision-makers to close sea ports and airports. and how it would affect the way that the country would change their foreign policy. Overall economic activity has been slowed down by the separation of Biafra from the Federal economy and by the uncertainties and dislocations caused by the civil war and the 18 months of deepening crisis preceding it. In 2002-2004. In 1970. care giving.

Furthermore. Nigeria had advanced efforts to provide universal primary education. The most salient example of this is perhaps the reality that China has tended to export more to the continent than the other way round. cobalt from the Democratic Republic of Congo. because of their affordability. The Congress of South African Trade Unions in South Africa launched a “buy local” campaign that was motivated by a perceived threat posed by China in 2012. In an update released in 2004. more jobs have allegedly been threatened in the West African coast by alleged illegal fishing by Chinese nationals. Contraction to Trough Stage. less than optimum conditions in Chinese- owned factories in Zambia led in 2004 to the death of close to 40 employees in an explosion. the UN found that Nigeria was making progress toward achieving several goals. Moreover. tend to bring about a crowding-out effect on the continent’s domestic producers. protect the environment. and develop a global development partnership. and the impact estimates suggest that containment and mitigation expenditures as high as several billion dollars would be cost- effective if they successfully avert the worse scenario. Peak Stage. Specifically. the balance of trade is tipped in favor of China. the relationship between Africa and China has so far not been particularly perfect and harmonious. External financing is clearly needed in the country. trade unions have been at the forefront of attempting to curb China’s access to African markets.response. an even more oblique picture emerges as it is clear that China mainly imports mineral resources (timber and forestry from Gabon. In fact. copper from Zambia. In 2004-2006. And throughout the window period in which African countries were given access to US markets by the American Growth Opportunity Act. and oil from Angola to mention a few) and in turn exports into the continent manufactured textiles and technologies which. Even though there are more than fifty African countries. Chinese companies allegedly took advantage of that and set-up and registered businesses in Africa so as to gain access to the US market for themselves. Looking at the characteristics of the trade. NIGERIA Gross Domestic Product and Expenditure at Current Purchaser’s Values (Naira Million) 2007 & 2010 2007 2010 12 .

There is an element of lobbying in relation to the National Assembly. such as students.163. In the absence of credible political institutions for popular representation.932.682. In recent years. the trade unions in Nigeria are assigned a leading role in voicing poplar grievances.587.910.45 27.910.940.73 GROSS DOMESTIC PRODUCT 20. lies in the ability of the unions to rally other social groups.00 4. and unions and employers act together in petitioning the government on grievances that are specific to a particular sector.36 LESS IMPORTS OF GOODS AND SERVICES 6.43 DOMESTIC PRODUCT COMPENSATION OF EMPLOYEES 1.952.063.70 9.832.30 OPERATING SURPLUS 19. the Labor and Civil Society Coalition (LASC) has provided a forum for such alliances.350.265. GOVERNMENT FINAL CONSUMPTION 2.570.935. market women.54 13.419.20 1. in support of a particular policy or.854.691.498.498.146. The primary avenue.46 429. the textile industry where they make joint demands on tariffs.040. and public subventions.63 1. customer services. and professional associations.43 Source: https://www.049. 13 .265.43 GROSS FIXED CAPITAL FORMATION 1.proshareng.757.940.876.545.608. for Economy-in-2010 The existence of trade unions in South Africa and Nigeria in the global economic crisis led to no procedures that give unions an institutionalized say in policy making.906.46 CONSUMPTION OF FIXED CAPITAL 276.236.059. rather.52 EXPENDITURE INCREASE IN STOCKS 1.14 4.90 29.874.23 39.896.539.01 270.327.30 17.039.441.882.743. in opposition to government policy.163. illegal imports.90 29.007.600.69 INDIRECT TAXES 314.71 LESS SUBSIDIES 30.565.143.00 EXPENDITURE PRIVATE FINAL CONSUMPTION 15. however.40 EXPORTS OF GOODS AND SERVICES 7.28 EXPENDITURE ON THE GROSS 20.

Through the help of other countries they were able to stand again and achieve economic growth. The unintended consequences of the post consolidation banking reforms led to tight monetary and credit conditions. The unions in the two countries play a critical role in enforcing a popular democratic response to the crisis. The global economic crisis has led to decline in global flows of trade. the global economy witnessed immense shocks with resultant financial sector crisis and economic meltdown that affected almost every economy across the globe. World growth was projected to contract by about 1% in 2009 and to expand by about 3% in 2010. 14 . The unemployment rate decreased and inflation rate stabilized that became the reason to develop their economy. Their mode of insertion in a highly unequal global order defines a commitment to the modernization of society in opposition to the prevailing market economy. Nigeria’s economy in 2010 with economic fundamentals remains strong and resilient in view of the current effort of government because of its appreciable growth performance. A concerted pursuit of this goal will ensure that we turn our economy around over a relatively short period of time. For the Nigerian economy. The Nigerian economy was not left out. however. Nigeria’s investment increases and increases its savings and lead to the economic growth of the country. depends not only on their ability to represent the interests of their members. During the period 2008 into the better part of 2009. However. fiscal developments during 2009 continued to support macroeconomic stability as well as increased spending on critical infrastructures to diversify the base of the economy. throwing most leading economies into recession. Their credibility as part of the popular democratic forces. Thus inflation rate and unemployment rate has a big role in the gross domestic product of Nigeria. This trend is expected to be sustained in 2010. which has led to reduced economic output with adverse consequences on living standards and job creation. but also on the way they fight for the right to voice grievances and to organize in their societies more broadly. 2009 was certainly a year during which the challenges posed to the world economy brought unusual uncertainty to the Nigerian economy. which is well below the rates achieved before the crisis. The economy of Nigeria faced challenges and problems but they didn’t face it alone. Because of that.