This study examines some of the fundamental issues and questions of governance and development in the Nigeria economy that has been overlooked over the years since the discovery of crude oil in Nigeria, which is, the issues of allocation and utilisation of oil revenue. Crude oil has been an indispensable source of energy and revenue for Nigeria from 1960 to date. It generates the most astounding sum of income to the federal, state and local governments in Nigeria and has made Nigeria to be considered as the largest producer of crude oil in Africa followed by Angola, the seventh in the Organization of Petroleum Exporting Countries (OPEC), and the thirteenth in the world. Conversely, even with the enormous revenues earned from oil activities in the country, its impacts are not reflected in the various stages of developments in the country, unlike Indonesia who maximises its resources and subsequently, increases her per capita income to a point where it grew four times that of Nigeria within few decades. Instead, the oil prosperity has brought stunted socio-economic growth to Nigeria, and this has grown to be a continuous and vital source of worries that need urgent attention. The focus of the study is to appraise the paradox associated with oil revenue, the allocation and utilisation of oil revenue in Nigeria with a definite emphasis on the macro-accounting perspective of the impact on the Nigerian economy from 1981 to 2016. Specifically, the study examines the effects of oil revenue on economic growth, current account balance, external debt, and net foreign assets of Nigeria from 1981 to 2016. In line with the aim and objectives, research questions and hypotheses formulated for the study, the study tends toward the quantitative approach. Hence, the ex-post facto research design and the purposive sampling technique were considered suitable and therefore, adopted for the study. Series of diagnostic tests were conducted on the data, and Autoregressive Distributed Lags (ARDL) was later adopted to analyse the hypotheses formulated for the study. The study uncovers an adverse effect of oil revenue on the external debt and economic growth of Nigeria. On the other hand, the study revealed a positive relationship between oil revenue and the current account balance and net foreign assets of Nigeria. In addition, the study revealed a positive relationship between oil revenue allocation, oil revenue utilisation and the economic growth process of Nigeria. The error correction terms of 20%, 83%, 25%, 22% and 45% in the Error Correction Models indicate the proof of the relationship between the dependent variable and the independent variables and the speed of adjustment in the direction of the long run equilibrium, which also implies that the models are fit and significant for the study. The study has made several findings contrary to the general ideology and expectation of the masses and previous studies, one of which is the shifting of emphasis from non-oil related variables in establishing the connection between oil revenue and the economic growth process in Nigeria to mainly oil-related variables. The study, therefore, recommends an intense look into the need for accountability, transparency and value for money in respect to the management of oil revenue in Nigeria. Secondly, corruption, the major cankerworm eating the buds and greeneries of Nigeria, can be reduced and subsequently, overcome if training programmes on corruption are organised on continuous basis in all the agencies and parastatals in Nigeria preferably, on a weekly basis, with the aim of reshaping the way people think about themselves, the country and the negative impact of corruption on the society. This also includes making the anti-corruption institutions in the country operating independently from any political affiliations.
|Date of Award||4 Apr 2019|
|Sponsors||Tertiary Education Trust Fund (TETFUND)|
|Supervisor||Reza Kouhy (Supervisor) & Aminu Hassan (Supervisor)|
- Oil revenue
- Oil allocation
- Oil utilization