"Adding frost to snow" — The decline of Africa's most populous country and the impact of Nigeria's mass protests

II. A common ailment of resource-dependent countries: over-concentration of the economy Since gaining independence from Britain in 1960, Nigeria was once hailed as Africa’s beacon of hope. Its abundant oil reserves and massive population secured its pivotal position in Africa’s economy. Yet despite enormous developmental potential, Nigeria’s economic progress has long been hampered by political corruption, military coups, and social unrest. During the 1970s and 1980s, Nigeria experienced an oil boom, with substantial investment flowing into transportation, telecommunications infrastructure, education, and healthcare. However, falling oil prices and global market volatility gradually plunged Nigeria’s economy into crisis. In recent years, although the government has introduced a series of economic diversification policies, the oil sector remains the country’s primary revenue source. According to data from the National Bureau of Statistics of Nigeria, Nigeria’s real GDP in 2022 was 10.09 times its 1952 level, while real GDP per capita stood at 1.49 times the 1952 figure. Yet approximately 63% of the population lives in "multidimensional poverty," indicating that although aggregate economic output has grown, living standards for ordinary citizens have not improved significantly. The latest report from the Nigerian Employers’ Consultative Association (NECA) estimates that, in 2020, around 102 million Nigerians—roughly 50% of the nation’s 205 million people—lived in extreme poverty, surviving on less than USD 1.90 (approximately RMB 10) per day. Weak governance has further exacerbated Nigeria’s economic decline. Since independence, Nigeria has undergone repeated regime changes—including periods of military rule and democratic elections. From 1960 to 1999, Nigeria spent most of its time under military dictatorship, only achieving a smooth transition from military to civilian rule in 1999. More recently, presidents such as Olusegun Obasanjo, Goodluck Jonathan, and Muhammadu Buhari introduced various policies aimed at stabilizing the economy and narrowing income inequality. Yet due to political instability, pervasive corruption, inadequate infrastructure, and heavy reliance on oil exports, reform efforts have yielded mixed results—and are frequently undermined by internal graft and external shocks. During President Buhari’s tenure, low oil prices triggered Nigeria’s first-ever recession; moreover, his administration’s proposal—just before stepping down—to abolish fuel subsidies has had profound and lasting effects on Nigeria’s current economy. The global outbreak of the COVID-19 pandemic at the end of 2019 dealt another severe blow to Nigeria’s already fragile economy. Plummeting oil prices and worldwide economic contraction pushed Nigeria into its worst inflationary episode on record. When this author arrived in Nigeria in early 2019, the exchange rate stood at roughly 50 Nigerian naira to 1 Chinese yuan; by August 2024, it had deteriorated to 223 naira per yuan—a more than fourfold depreciation. Moreover, the Central Bank of Nigeria often lacks sufficient foreign exchange reserves, meaning this trend may persist or even worsen. III. Problems intensify under President Tinubu Since assuming office in May 2023, President Bola Tinubu has implemented a series of major economic reforms—most notably the abolition of petroleum subsidies and the unification of the official exchange rate.

Nigeria’s fiscal and livelihood conditions: 'fire and ice' coexisting; where have Chinese enterprises’ profits gone?

Looks rich on paper—but not necessarily on the ground In Q1 2026, Nigeria’s actual daily crude oil production stood at just 1.48 million barrels—significantly below the budgeted target of 1.84 million barrels. This shortfall is no mere accounting error; it reflects a longstanding, systemic problem. Anyone who has visited the Niger Delta knows well that pipeline tapping for illegal oil theft has become commonplace. Even if global oil prices soar, Nigeria cannot reap fiscal benefits unless crude can actually be produced and exported. That windfall remains confined to reports—not reality. The Nigerian Economic Summit Group (NESG) does not shy away from this issue. Its report explicitly warns that roughly 20% of projected revenues will be directly eroded by this production gap. Put plainly: Nigeria isn’t lacking opportunities to earn money—it’s leaking too badly. As soon as oil revenue flows in on one side, it leaks out through pipelines, weak governance, and poor implementation on the other. Practical implications for Chinese enterprises The government may currently hold some cash—that’s important. But more critically, those funds are insufficient to satisfy all claimants. Those who act first stand the best chance of getting paid first; those still waiting for formal procedures, personal connections, or official notifications will likely remain stuck at the back of the queue. Your top priority tomorrow morning—before any strategic meetings—is to task your finance and commercial teams with immediately auditing all outstanding receivables tied to federal and state governments, as well as government-guaranteed projects. Go line by line: Who owes what? How much? For how long? And at which stage of approval does each payment currently sit? Pay special attention to funds covered under Executive Order No. 9 of 2026—which mandates direct deposit into the federal account. This is not theoretical space; it’s real, tangible money. Moreover, ahead of national elections, governments typically rush to deliver visible achievements, accelerate project execution, and stabilize public sentiment—making this period unusually conducive to debt collection. Opportunities like this are rare; miss them, and they’re gone for good. When the Nigerian government profits, enterprises don’t necessarily smile back: A retail gasoline price of ₦1,500 is no bluff National-level revenue gains do not automatically translate into corporate profitability. Nigeria has abolished fuel subsidies—and the implication is straightforward: In the past, when international oil prices rose, the government absorbed part of the cost for society; now, however, domestic retail fuel prices broadly track global benchmarks. Costs are no longer hidden in the fiscal budget—they’re passed directly onto the market, onto businesses, and onto every truck, generator, and delivery run. Thus, a surge in retail gasoline prices toward ₦1,500 is not alarmist speculation. Transporting a container from Lagos Port to Ibadan becomes more expensive; running diesel generators during factory blackouts adds cost; employee commuting, last-mile deliveries, and raw material transport—all ultimately feed into cash flow pressure. Doing business in Nigeria often appears, on the surface, to be about selling goods—but in reality, it’s a constant contest against logistics costs and energy expenses. According to NESG’s modeling, this round of oil-price-driven inflation could push overall inflation upward by 1.3 to 5.2 percentage points over the next two to three quarters. That is no small number. Once inflation rises further, enterprises face heavier expenditures—and consumer behavior shifts accordingly. With the same amount of money, people can buy fewer goods. Low-cost essentials may still hold up, but mid- to high-priced consumer products will become significantly harder to sell.

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