Situation and cooperation

Students of a public secondary school for girls in Abeokuta, Nigeria

Since gaining independence more than 50 years ago, Nigeria has experienced numerous political crises. Long phases of authoritarian military rule and an economy overly dependent on oil revenues have worsened existing social and economic inequality and aggravated conflicts between different regions and communities. Social and economic conflicts have often been used as a pretext for pitting ethnic or religious groups against each other.

After almost three decades of military rule, a process of democratisation began in 1999. In April 2011, parliamentary, presidential and regional elections were held, from which the then President, Goodluck Jonathan, and his party emerged victorious. European Union election monitors found these elections to have been the most credible since the country's return to democracy in 1999.

The presidential elections in spring 2015 were overshadowed by attacks by Islamist terrorist groups. The election was won by Muhammadu Buhari, the candidate of the opposition. Thus, Nigeria saw another orderly change of government and took an important step towards true democracy. Nonetheless, issues such as good governance, anti-corruption, civil society participation and inclusive poverty reduction remain huge political challenges.

Social disparity

Boys rummaging through heap of refuse for recyclable items

Notwithstanding Nigeria's high revenues from the extractive sector and its economic growth, which was stable over many years, the latest Human Development Index (HDI) ranks the country only 157th out of 189 countries. More than half of the population live below the poverty line. At just 53 years, average life expectancy is one of the lowest in the world.

Standards of health and nutrition are shockingly poor in large parts of the population, with problems beginning right at birth. According to World Bank figures, the average under-five mortality rate is 104 children out of every 1,000. Around one third of the population have no access to safe drinking water. Some 70 per cent of the people do not have adequate sanitation. Only a little more than half of the population are connected to the power grid. The illiteracy rate is 40 per cent.

Nigeria's wealth of oil only benefits a small elite. Cronyism, corruption and conflicts over the distribution of resources are part of everyday life. On Transparency International's Corruption Perceptions Index for 2017, Nigeria is ranked 136th out of 176 countries evaluated.

The oil and gas industry brings in high export revenues for the country. However, the sector generates hardly any new jobs. The government's plan to diversify the economy is only proceeding slowly. A run-down energy infrastructure, the low level of education among the people, a lack of legal certainty, the lack of access to financial services and the unstable security situation prevent the economy from developing more dynamically.

Over the past 30 years, Nigeria's population has more than doubled, from just under 84 million (1985) to approximately 190 million (2017). The young generation, whose numbers are constantly growing, has almost no prospect of reliable jobs, housing or basic social protection. Youth unemployment is high, especially in rural areas.

Security situation

In April 2014, the terrorist organisation Boko Haram kidnapped 276 schoolgirls from their school in Chibok, Nigeria. Under the slogan "Bring Back Our Girls", women in the capital Abuja are demonstrating for their release.

The huge socio-economic disparities within the population and the lack of opportunities for the people are provoking social tensions and are a factor in the violent conflicts that have shaken Nigeria again and again.

For instance, there was fighting in the oil fields of the Niger Delta for many years between various armed local groups, paramilitary criminal gangs and security forces. The situation only calmed down when the government offered amnesty to militants in 2009. Following new attacks on oil installations by militant groups, the amnesty programme – which originally ended in late 2015 – was extended in February 2016 by another two years, until the end of 2017. In August 2016, a ceasefire was agreed.

The number of attacks by the Islamist terrorist group Boko Haram has declined considerably since President Muhammadu Buhari took office. Previously, the group had begun to pose a threat to Nigeria's domestic stability and to the stability of its neighbours Cameroon, Niger and Chad. Large sections of north-eastern Nigeria had been under the control of the terrorist group. An international force was able to drive Boko Haram from these areas in the autumn of 2015. However, the group continues to carry out suicide attacks and kidnappings.

More recently, conflicts between pastoralists and farmers in central Nigeria have flared up again. Nomad pastoralists traditionally move south from the northern part of the country to graze their cattle and bring meat to the slaughterhouses in the south. However, the old grazing corridors no longer exist. The land has either been built up or is now being used for farming.

As a result of increasing desertification in northern Nigeria, population growth and the current economic difficulties, there are more and more conflicts over land and resources.

The Nigerian government's reform course

Polio vaccination at a health station in Abeokuta, Nigeria

At the turn of the millennium, the government launched a process of reform. The programme has the ambitious goal of positioning Nigeria as one of the twenty leading economies in the world by 2020 ("Vision 20:2020").

In recent years the Nigerian government has managed to improve the general environment for the economy and its financial policies. A proportion of the country's oil revenues is paid into a special account held by the central bank and used to finance a more stable fiscal policy, prevent inflation and build reserves for times of crisis. The government has also set up a sovereign wealth fund, which is also fed from oil revenues and is intended to provide funding for important infrastructure projects.

However, oil prices have declined significantly since mid-2014, which has had a direct impact on government revenue and the level of reserves. In 2015, economic growth was only 2.7 per cent, and in 2016, the economy actually shrank by 1.8 per cent. The International Monetary Fund (IMF) expects that the growth rate will recover slightly in 2018 and 2019.

Some initial progress has also been made on anti-corruption efforts. Among other things, Nigeria has swiftly implemented the requirements of the Extractive Industries Transparency Initiative (EITI). Nigeria was the first African country to receive EITI validation.

Bills to improve budget planning, spending controls and financial transparency have also been launched. If the government continues to pursue its reform policy consistently, Nigeria should have great opportunities for sustainable development, given its vast natural, economic and cultural resources.

Human rights

Eligible voters being accredited in Abuja, Nigeria, in March 2015

The human rights situation has improved significantly since a civilian government came to power in 1999. Nigeria has signed several fundamental human rights conventions. Political prisoners have been released and freedom of the press and freedom of speech have been introduced.

But citizens are still not adequately protected against arbitrary action by the government or violent acts perpetrated by other parties. The country's prisons are overcrowded, and conditions there are unacceptable. In 2007, the use of the death penalty was suspended, but this was revoked in 2013. The situation of lesbian, gay, transgender and intersex people is also alarming. In 2014, a law entered into force that provides for long prison terms for people in homosexual partnerships.

Twelve of the northern states have Islamic Sharia law, which is not compatible with modern legal practice. Moreover, many women and girls suffer from gender-based discrimination. One important step was taken in June 2015, when female genital mutilation, which used to be widely practised, was banned.

Development potential

Gas flaring in the Niger Delta has caused tremendous damage to the environment and human health.

Nigeria's immense oil and gas reserves will continue to have a defining impact on the country's development. Among other things, the government is planning to significantly increase natural gas production and gas-to-liquids conversion. In order to tap the West African market, a gas pipeline to Ghana has been built. There are also plans for a trans-Sahara pipeline to Algeria in order to serve the European market.

Other growth industries are telecommunications and information technology, construction, manufacturing, retail, energy and agriculture. The agricultural sector has been badly neglected ever since oil was first discovered in Nigeria. Agricultural production is not sufficient to meet the domestic demand for food, meaning that the country has to import food. The government has recognised the potential of the agricultural sector and is working to increase production.

Priority areas of German development cooperation with Nigeria

Development cooperation between Nigeria and Germany dates back to the country's independence in 1960. During the military dictatorship of Sani Abacha (1993 to 1998), bilateral cooperation was more or less suspended. Since the country's new democratic dawn in 1999, German development cooperation has focused on supporting the reform efforts of the government with a view to reducing poverty, achieving inclusive economic growth and fostering regional stability. Most activities are therefore concentrated on the priority area of sustainable economic development.

One major impediment to economic development is the inadequate power supply. Germany is therefore assisting Nigeria in the fields of rural electrification, energy efficiency and renewable energy.

As part of its Financial Cooperation with Nigeria, the BMZ supports an immunisation programme of the World Health Organization (WHO) and the United Nations Children's Fund (UNICEF) to eradicate polio. The support focuses on vaccination campaigns in the north.

Furthermore, a Green Innovation Centre was set up with funding from the 'ONE WORLD – No Hunger' initiative. This is intended to support the reform of the agricultural sector, with a special focus on food security.

In 2016, Germany pledged a total of 57.6 million euros for official development cooperation with Nigeria.

Sustainable economic development

A farmer in Nigeria watering a rice paddy

Successful poverty reduction requires, among other things, a significant expansion of job and income opportunities for the country's growing population. However, the private sector, which could provide a great many jobs, is still underdeveloped. German development cooperation therefore focuses on creating a better environment for private sector activities, addressing the following aspects:

  • Improving the business and investment climate, for example by helping the government set up central points of contact for companies and carry out reforms in the areas of land acquisition/registration, building permits and tax administration
  • Supporting microfinance institutions in order to give micro, small and medium enterprises (MSMEs) and low-income households access to loans
  • Fostering Nigeria's banking sector, for instance through the establishment of an agricultural fund in support of rural small and medium-sized enterprises
  • Supporting financial system development, for example with regard to regulating microfinance banks and developing consumer protection regulations in the financial sector

Renewable energy and energy efficiency

Despite much investment, many parts of Nigeria have power for only a few hours a day. Nearly half the population have no access to electricity. In rural areas, that share is even much higher. As part of a temporary programme, Germany supports the Nigerian government in boosting investment in renewable energy so as to develop a resource-friendly and environmentally sound energy supply.

An advisory programme launched in spring 2013 and co-financed by the European Union is aimed at improving the legal environment for the energy sector, introducing, for example, efficiency standards for electrical appliances and feed-in tariffs. Moreover, training is being provided to important energy sector players, and decentralised power supply is being developed with German support in specific rural regions.

This cooperation is part of the Nigerian-German energy partnership set up in 2007, which focuses on encouraging German private companies to get involved in the sector. This is an active effort to intertwine development cooperation efforts and private sector activities.

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