A Study on Niger Delta Development Commission(Msc Thesis) vs 1997

8/10/2019 A Study on Niger Delta Development Commission(Msc Thesis) vs 1997

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OIL AND INFRASTRUCTURE

DEVELOPMENT IN THE NIGER

DELTA REGION OF NIGERIA

Okon, U. M.

(319086

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En-%n++)%n-

Un%&+)%/ o$ "+ %'+))'n

2o"'nn+4)-

2'n4')/ 5009

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Table of Contents

CHAPTER ONE............................................................................................................4

INTRODUCTION........................................................................................4

1.1 Brief Background to Study.......................................................................................4

1.2 Statement of te Pro!"em.........................................................................................#

1.$ O!%ecti&e of Study....................................................................................................#

1.4 Re'earc (ue'tion'..................................................................................................)

1.* Significance of te Study.........................................................................................)

1.# Sco+e of Study.........................................................................................................)

1.) ,imitation of Study..................................................................................................)

CHAPTER T-O............................................................................................................

LITERATURE REVIEW..............................................................................8

2.1 Oi" and -or"d Economie'........................................................................................

2.2 Hi'tory of Oi" Conce''ion'....................................................................................1$

2.$ Sca"e of Return' on /n&e'tment..............................................................................1)

2.4 /nf"uence of Petro"eum on 0e&e"o+ment of Oi" Producing Nation' Countrie'. . .1

2.4.1 A!u 0a!i..........................................................................................19

2.4.2 0u!ai................................................................................................19

2.4.$ (atar.................................................................................................20

2.4.4 u3ait...............................................................................................20

2.4.* Saudi Ara!ia........................................................................................21

2.4.#/ra...................................................................................................22

2.4.) /ran...................................................................................................22

2.* Oi" and Po&erty......................................................................................................2$

2.# Oi" and 0e&e"o+ing Nation'...................................................................................25

2.) Oi" Boom................................................................................................................$1

2. 0utc 0i'ea'e.........................................................................................................$2

2.5 -a'ted -indfa""'....................................................................................................$$

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$.6 /nfra'tructure 0e&e"o+ment....................................................................................$4

$.1 /nfra'tructure and Ser&ice 0e"i&ery.......................................................................$*

$.2 Em+"oyment Creation troug Pro&i'ion of /nfra'tructure....................................$*

$.$ Em+"oyment7/nten'i&e Con'truction......................................................................$)

$.4 Nigeria Oi" and 0e&e"o+ment 0i"emma.................................................................$

$.* 8i"itancy and 9nre't in te Niger 0e"ta................................................................$5

2.16 :o&ernment 0e&e"o+ment Effort' of te Niger 0e"ta Region.............................46

2.16.1 Niger 0e"ta 0e&e"o+ment Board.............................................................41

2.16.2 Pre'identia" Ta'k ;orce.........................................................................41

2.16.$ Oi" 8inera" Producing Area' 0e&e"o+ment Commi''ion...............................41

2.16.4 Niger 0e"ta 0e&e"o+ment Commi''ion.....................................................41

2.11 Te Niger 0e"ta 8a'ter P"an................................................................................42

CHAPTER THREE......................................................................................................4$

RESEARCH METHODOLOGY...................................................................43

$.1 Se"ection of Pro%ect................................................................................................44

$.2 0ata Co""ection.......................................................................................................44

$.$ Re'earc Strategy...................................................................................................44

$.4 Time7'ca"e..............................................................................................................44

$.* Budget....................................................................................................................4*

-ork' Cited..................................................................................................................4#

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CHAPTER ONE

INTRODUCTION

1.1 !"ef a#$%!o&n' to St&'(

Nigeria i' "ocated in -e'tern Africa 3it it' 'outern coa't"ine on te :u"f of :uineae te Niger 0e"ta Regiona" 0e&e"o+ment 8a'ter +"an.

To ig"igt ma%or +ro!"em' +re&enting de&e"o+ment gro3t and contri!uting

to re'ti&ene'' in te region. To 'ugge't and make recommendation'.

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1. Resea!#- 2&est"ons

/' te Niger 0e"ta Regiona" 0e&e"o+ment 8a'ter +"an ca+a!"e of addre''ing

te 'ocio7economica" and infra'tructura" !ack"og'Fo Ha' N00C "i&ed u+ to te mandate for 3ic it 3a' e'ta!"i'edF

o Ha' infra'tructura" de&e"o+ment in te region met te +eo+"e' demand

for 'er&iceFo /f not< 3at are te con'traint' and ca""enge'F

/' te N00C im+"emented +ro%ect' centered on uman de&e"o+ment and

em+o3erment of te "oca"'F

1.3 S"%n"f"#an#e of t-e St&'(

Ti' 'tudy i' aim' to unco&er te under"ying +ro!"em' entang"ed in te i''ue' of

de&e"o+ment in te region< u'ing metodo"ogie' from +ro%ect management and

de&e"o+ment 'tudie'. Ti' te'i' i' aimed at +ro&iding +ractica!"e a++roace'ed nation' 'a3 ydro7car!on re'ource' a' a +otentia"

for dri&ing future in&e'tment and a ne3 da3n for !u'ine'' during te indu'tria"

re&o"ution. Ti' +ro+e""ed te ue't to e=+"oration of 3or"d +etro"eum de+o'it' 3it

e=+"oration +ioneered !y te 9nited State' of America< :reat Britain< ;ranceed to recruit foreign nationa"' for teir

o+eration' to te e=tent tat tey cou"d not find ua"ified +er'on' among te

nationa"' of te o't country !ut tey a"'o ad te o!"igation to +ro&ide

tecnica" training cour'e' and to take oter 'te+' to make +o''i!"e te

+rogre''i&e re+"acement of foreign nationa"'. Ho3e&er< te +o"icy actua""y

+ur'ued !y te conce''ionaire aimed at +o't+oning 'uc re+"acement a' "ong a'

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+o''i!"e and in +articu"ar at maintaining for an indefinite +eriod te occu+ation

of +o'ition' of im+ortance !y foreign nation'.

Ti' 'o3ed nonca"ant attitude and in'incerity to3ard' !ui"ding "oca" ca+acity !y

foreign mi''ion' "eading to agitation !y te State for re&i'ion of conce''ionary

agreement'.

Te ear"y oi" conce''ion' 3ere contro&er'ia" 3it te oi" indu'try' o+eration !a'ed on

te 3ritten agreement !et3een te com+anie' and te go&ernment 3ic at tat time

3ere +o"itica""y 'u!ordinated direct"y or indirect"y !y foreign +o3er'. According to

Sayeg 15#< +.$1< te moti&e' of any State in granting conce''ion' 3a' to +romote

te '+eedy di'co&ery and de&e"o+ment of te nation' oi" re'ource'. Ty+ica" oi"

conce''ion' a&e te fo""o3ing feature'G

1. A +ro&i'ion re"ating to 3at te com+any' !u'ine'' in te country 'ou"d !e.

Te go&ernment grant' te com+any te e=c"u'i&e rigt to e=+"ore< +ro'+ect< dri""

for< e=tract< treat< manufacture< tran'+ort< dea" 3it< e=+ort +etro"eum etc. Te

go&ernment a"'o 'et' te minimum reuirement' of te'e o+eration' main"y in

annua" dri""ing.

2. A +ro&i'ion a' to area of o+eration 3ic u'ua""y i' a "arge +art of< if not te

3o"e country.

$. A 'tatement of te duration of te grant 3ic u'ua""y run' for 4*7)* year'.

4. A +ro&i'ion for te +ayment to te go&ernment of an annua" dead rent or !onu' or

oter 'ecurity fee'.

*. A +ro&i'ion for te +ayment to te go&ernment of roya"ty on a"" net crude oi"

+roduced and 'a&ed. Origina""y it 3a' a fi=ed roya"ty +er ton !ut 3a' canged to

*67*6 +rofit 'aring in te 15*6'.

#. An ar!itration c"au'e< to +ro&ide for +rocedure' in te e&ent of di'agreement

a' to te term' of te conce''ion it'e"f.

). A commitment to te em+"oyment of an indigenou' "a!our force and

o!"igation to train te 3orker'. Ti' came "ater after agitation !y te State.

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0i''ati'faction o&er te year' aro'e a' a re'u"t of te un+o+u"ar and unfa&ora!"e

conce''ion !ecau'e tey did not a&e te !e't intere't of te nation at eart< tu'

initiating a rea'on for rene3a". Ti' e&o"ution "ed toG renegotiation'L nationa"i>ationL

creation of nationa" com+anie' and oter 'tate agencie'L +romu"gation of nationa"

+etro"eum "a3'L e'ta!"i'ment of te 'o7ca""ed *6 J *6 and )* J 2* +rofit J 'aring

regime'L 'tate +artner'i+ 3it te e=+"oiting com+anie'L and direct o+eration !y te

'tate Rouani 15)1< +.4*. Ti' 3a' te !eginning of te modern7day o+erating

'tructure. Sayeg 15#< +.$2 'tated tatG

Recent"y< mo't of te Ara! go&ernment' a&e 'ougt more direct +artici+ation< and

no3 &ariou' agreement' +ro&ide for a State agency to !e admitted to +artner'i+

3it te foreign com+any after te di'co&ery of oi". Te +ractice i' &a"ua!"e noton"y !ecau'e go&ernment' a&e not a"3ay' !een 'ati'fied mere"y to dra3 re&enue'

from te indu'try< !ut a"'o !ecau'e 'uc +artner'i+ gi&e' tem kno3"edge and

e=+erience in oi" +ro!"em'.

Countrie' 'tarted a&ing a 'tronger gri+ on affair' of oi" e=+"oitation 3it te !reaking

of te conce''ionaire' mono+o"yG "ong7term conce''ion' 3ere re+"aced 3it 'ort J

term "icen'e for +ro'+ecting o&er a "imited areaL and !etter +rofit 'aring formu"ae

3ere initiated on *6 J *6 and or )* J 2* !a'i'. Ti' meant tat countrie' ad morecontro" and in&o"&ement in te indu'try and more financia" re'ource' to meet te

de&e"o+ment need' of teir +eo+"e. Tey !e"ie&ed tat te ige't +o''i!"e rate of

gro3t of teir countrie' cou"d on"y !e reaced !y te greate't +o''i!"e de&e"o+ment

of teir natura" re'ource' and te 'trengtening of teir a!i"ity to undertake ti'

de&e"o+ment tem'e"&e' Sayeg 15#. Ti' 3a' 'u++orted !y te 9nited Nation'

Re'o"ution of No&em!er 2*15##< 3ere te :enera" A''em!"y recogni>ed te rigt

of a"" countrie'< and in +articu"ar of te de&e"o+ing countrie'< to 'ecure and increa'e

teir 'are in te admini'tration of enter+ri'e' 3ic are fu""y or +art"y o+erated !y

foreign ca+ita". And a"'o< to a&e a greater 'are in te ad&antage' and +rofit' deri&ed

terefrom on an euita!"e !a'i'< 3it due regard to te de&e"o+ment need' and

o!%ecti&e' of te +eo+"e' concerned and to mutua""y acce+ta!"e contractua" +ractice'

and ca""' u+on te countrie' from 3ic 'uc ca+ita" orginate' to refrain from any

action 3ic 3ou"d inder te e=erci'e of tat rigt Sayeg 15#.

Countrie' 'tarted to 'eek nationa"i>ation of te oi" indu'try 3it 8e=ico taking te"ead. 0uring te 1526 and te 15$6< it made effort' to 'ecure to a "arger +ro+ortion of

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te com+anie' +rofit' and to im+ro&e te "i&ing condition' of 8e=ican 3orker'

engaged in te indu'try. Nationa"i>ation !rougt to 8e=ico eui"i!rium !et3een it'

dome'tic con'um+tion< 3ic a' increa'ed con'idera!"y 3it it' economic

de&e"o+ment and it' +roduction Rouani 15)1.

Te'e countrie' o3e&er< did not acie&e nationa"i>ation ea'i"yG tere 3a' di+"omatic

ten'ion 3ic "ed to !oycotting of teir oi" e=+ort' in te 3or"d marketL and difficu"ty

in o!taining foreign 'u++ort in te form of eui+ment< materia"'< maintenance of

in'ta""ation' and finance'. Com+en'ation 3a' agreed on for e=+ro+riation. 8e=ico'

attem+t to 'eek amendment to te 'y'tem of conce''ion "ed to te reduction in rate of

oi" +roduction. Te 8e=ican go&ernment decided to take o&er te management of te

indu'try and e=+ro+riated te com+any' +ro+ertie' in te +u!"ic' intere't. By it'

action< te go&ernment e=+o'ed it'e"f to +o"itica"< tecnica"< financia" and

admini'trati&e ca""enge' 3ic tey did not a&e te ca+acity to 'ou"der Sayeg

15#< +. 4). Ti' 3a' fo""o3ed !y :reat Britain' !reak7off di+"omatic re"ation' and

dimini'ed &o"ume of +roduction. Te go&ernment ad to face te o!"igation of

+aying com+en'ation'. Simi"ar difficu"tie' 3ere e=+erienced in /ran and /ra 3om

em!raced nationa"i>ation and e=+ro+riation.

Te ma%or com+anie' 'trong"y re'i'ted any 'ugge'tion tat tey 'ou"d admit te

+roducing countrie' to any form of +artici+ation in teir enter+ri'e'. /ran "aid te

foundation of a ne3 arrangement tat 3ent !eyond tat regime< not !y direct"y

modifying eac +arty' 'are of te +rofit' !ut !y 'ecuring for it'e"f +artici+ation in

te enter+ri'e. Ti' im+ortant de&e"o+ment 3a' effected under te term' of te

Petro"eum Act of 15*)G '+ecia" ad&antageou' treatment 3a' re'er&ed for o+erator'

3o 3ou"d agree to conc"ude +artici+ation agreement' 3it Nationa" /ranian Oi"

Com+any 3it te "atter' 'are te euity not to "e'' tan $6 +er cent Rouani

15)1.

+. S#ale of Ret&!ns on In0est,ent

Te return' from in&e'tment in te oi" and natura" ga' indu'try i' &a't and a' te

+otentia" to dri&e te reuired economic gro3t of mo't im+o&eri'ed oi"7+roducing

nation'. Se""ey 266* 'tate' tat te co't ca+ita" e=+enditure of Briti' Petro"eum in

266$ 3a' I14 J 14.* !i""ion< more tan te gro'' dome'tic +roduct of eac of te $

countrie' 'ur&eyed in te 9N de&e"o+ment +rogram' 2661 Human 0e&e"o+ment

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Re+ort. Pa'e // of Se""< 8it'ui and 8it'u!i'i' Saka"in oi" and ga' de&e"o+ment

in te far Ea't of Ru''ia 3a' e'timated at I16 !i""ion< te !igge't e&er in&e'tment in

Ru''ia. /n te 8idd"e Ea't< te 0o"+in +ro%ect to +i+e natura" ga' from (atar to A!u

0a!i< 0u!ai< Oman and ten Paki'tan 3a' e=+ected to co't I J 16 !i""ion.

Return' from in&e'tment are o!tained troug rent. Rent i' +aid !y te +roducer' to

te 'tate in e=cange for te rigt to e=tract +etro"eum re'ource'. Ti' may take te

form of conce''ion fee< roya"ty on &o"ume' +roduced< ta= on +rofit'< or te 'tate'

+ortion of a +roduction7'aring agreement.

Se""ey 2662 'tate' tat for integrated oi" and natura" ga' com+anie' to'e 3it

u+'tream and do3n'tream o+eration' te return on in&e'tment for 155$ J 2662 3a'

te ige't for any indu'try at 12 +er cent 3it to'e 3it on"y e=+"oration and

+roduction at ) +er cent< refiner' and marketer' o&er 5 +er cent< com+ared 3it 11 +er

cent for te retai" indu'try< 5 +er cent for macinery and com+uter maker'< +er cent

for +rimary meta"' and "e'' for communication' and rea" e'tate. /n Nigeria< according

to te Economic and ;inancia" Crime Commi''ion E;CC a 3oo+ing 'um of a!out

I$66 J 466 !i""ion a' !een generated in te oi" and ga' 'ector of te country 'ince

+roduction date of +u!"ication of 'ource.

0e'+ite te enormou' &o"ati"ity of te oi" +rice to 3ic many ga' +rice' are "inkedue"a and /ra< and ) +er cent in /ran< tere!y

!eing +etro"eum J dri&en economie'. Te ra+id ri'e in oi" re&enue' in te oi" 'tate'

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+roduced an era of un+recedented infra'tructura" de&e"o+ment. /n&e'tment in

im+ro&ed +y'ica" infra'tructure 3a' 3e"comed 'ince it im+ro&ed te ua"ity of "ife

of teir +o+u"ation !ut te e=tent to 3ic it 'er&ed to add to te'e countrie' "ong7

term de&e"o+ment +ro'+ect' 3a' &aria!"e ;ind"ay 1554. Ti' 3a' attri!uted to

un'u'taina!"e de&e"o+ment +rogram' 3ic 3ere not &ia!"e !y &ariou' State agencie'

and go&ernment' eagerne'' to '+end money in +u!"ic infra'tructure 3itout 'trategic

+"anning.

Te e=+"oitation of oi" in te'e nation' !rougt in au=i"iary acti&itie' 3ic ad

mu"ti+"ier effect on e&ery facet of te 'ociety ranging from tecnica" and +rofe''iona"

trainingL em+"oyment troug +ri&ate enter+ri'e' and entre+reneur'i+'< and modern

admini'trati&e tecniue' 3ic contri!uted to im+ro&ement of "oca" ca+acity.

8o't of te'e region' e=+erience ur!ani>ation. 8oney i' canne"ed to te fe3

e=i'ting ur!an center'< main"y to te center of go&ernment 3ic attract' inf"u= of

immigrant' 3o +artici+ate in te +roce'' of cange in te'e center'. 9r!an

communitie' are u'ua""y mu"tiracia" com+o'ed main"y of A'ian' and -e'terner'L ti'

i' common in oi"7+roducing region 3ere di&er'e 3ork force' are attracted tat

inf"uence' te "e&e" of moderni>ation and te cu"tura" !e"ief' of te indigene'. Sayeg

15# 'tated tat ur!ani>ation im+"ie' +rofound 'ocia" and cu"tura" cange' for to'e

in&o"&ed in it. Ho3e&er ur!ani>ation< e'+ecia""y 3en it i' ra+id a' it' +ro!"em'.

0ri""ing for oi"< o3e&er< a' a 'ignificant ad&antage 3en te nomad' and &i""ager'

'ett"ement i' concerned. /t a' often made a&ai"a!"e for genera" u'e +re&iou'"y

unkno3n 'u++"ie' of underground 3ater 3ic i' u'ed for irrigation andor

agricu"tura" +ur+o'e' Sayeg 15#.

Re&enue i' o!tained from com+anie' !y te State troug direct +ayment of roya"tie'

and ta=e' u'ua""y in foreign e=cange< +ayment of 'a"arie' and 3age' to em+"oyee'ue"a at 1. mi""ion. 8ENA countrie' a&e !een a!"e

to acie&e ti' troug o+ening teir market' to foreign in&e'tor' 3it market

"i!era"i>ation +o"icie'. Countrie' 'uc a' Nigeria and mo't de&e"o+ing countrie' a&e

ad a mono+o"i'tic market 3ere!y te State o3n'< regu"ate' and o+erate'. Ti' "imit'

market di&er'ity and ca+acity to create em+"oyment.

0e'+ite te e=+erienced economic gro3t of *.# +er cent a year in 8ENA o&er 266$

and 2664 te 'tronge't gro3t in a decade< re'u"ting from increa'e in 3or"d demand

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for +etro"eum re'ource'< unem+"oyment a' dec"ined 3it te ri'e in oi" +rice' o&er

2666 J 2664 =y>. Ti' can !e attri!uted to te nature of te indu'try it'e"f 3ere

tere i' no direct "ink !et3een em+"oyment creation in te non7oi" 'ector and te oi"

'ector. Sayeg 15# 'tate' tat teG

Mining and exploitation of oil are not particularly effective in

transmitting knowledge to other sectors or in training (many) workers

who acquire skills which serve them well when they enter upon other

kinds of work. he technique of production in mining and oil tend to be

specific and do not lend themselves to useful application in other

sectors. !ccordingly" as far as the needs of other industries are

concerned" few workers are trained in mining and oil from which

others can recruit their skilled labour force.

Terefore< a' a need to meet +re''ing de&e"o+ment ca""enge' of te region'< te

region' 'ti"" need' iger gro3t 3ic de+end' on im+"ementing !road7!a'ed

'tructura" reform' to generate 'u'taina!"e gro3t o++ortunitie' out'ide of oi" =y>.

;urtermore< !a'ed on te -or"d Bank' ana"y'i' of te em+"oyment 'ituation in te

8ENA region in 266$< te num!er of ne3 %o!' tat need to !e created 3a' +ut ata!out 166 mi""ion o&er te ne=t 26 year' to kee+ +ace 3it "a!or force entrant' and

a!'or! te current unem+"oyed. Ti' im+"ie' rea" economic gro3t rate' a&eraging #

to ) +ercent a year for a 'u'tained +eriod of time. /n te "a't year a"one< gro3t a'

moderated to *.2 +ercent< 'ugge'ting tat te fundamenta" +ro!"em facing te region

in term' of %o! creation remain' uncanged 3it te recent 'urge in gro3t =y>.

Harry 266) argue' tat te mo't crucia" uman re'ource i''ue' 3itin te 'tate' of

te :u"f Coo+eration Counci" :CC4 region are to'e of em+"oyment creation for

citi>en' and "oca"i>ation re+"acing e=+atriate' 3it o't country nationa"'. He 'tated

tat te :CC go&ernment' regu"ar"y undertake +rogram' to reduce de+endence on

foreign 3orker' !ut te creation of a +roducti&e indigenou' 3orkforce and

3ort3i"e %o!' for teir citi>en' are neg"ected. ;urtermore< it i' not te num!er of

foreign 3orker' !ut te "ack of needed 'ki""' and 3ork attitude' among :CC citi>en'

a"ong 3it a "ack of 'ufficient num!er' of +roducti&e %o!' for to'e citi>en'< 3ic i'

4+(( comprises of ,ahrain; -u/ait;


28/48

te treat to te region Harry 266). 8o't Saudi yout' are find 3ork a' 'u+ermarket

ceckout 'taff< Baraini motor mecanic'< and Omani farmer'. -ea"t di'tri!ution i'

'ke3ed and ig "e&e" of underem+"oyment i' recorded. ;oreign 3orker' account for

!et3een ** +er cent and 56 +er cent of te :CC 'tate' tota" 3orkforce See Ta!"e.

a+i'>e3'ki 2661 cited in Harry 266)< ;a'ano and :oya" 2664 cited in Harry

266) a&e 'o3n tat e&en if a"" te'e

Table +G Stati'tic' on :CC +o+u"ation

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foreigner' cou"d !e re+"aced and te underem+"oyment of o't country nationa"'

ignored< te region 3ou"d 'ti"" face tremendou' ca""enge' in creating 'ufficient

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em+"oyment for it' citi>en'. Ti' 3ou"d a"'o a++"y acro'' a"" !order' of oter oi"7

region' in de&e"o+ing countrie'.

Se""ey 266* 3rite' tat tere i' e&idence tat oi" income 'timu"ate' natura"

+o+u"ation gro3t. ;or te OPEC mem!er countrie'< te +o+u"ation tota" ro'e from

25# mi""ion in 15)) to *$2 mi""ion in 2662. /n te 15)6' and 156' te annua"

+o+u"ation gro3t rate' for oi"7+roducing countrie' in te 8idd"e Ea't and Nort

Africa e=ceeded to'e of non7oi" +roducing countrie' in te region !y 2.* +ercentage

+oint'*. -it te o'ci""ating +rice of crude oi"< one7'ided and mono+o"i'tic economie'en'. 0e&e"o+ment entai"' modern infra'tructure !ot +y'ica"

and in'titutiona"< and a mo&e a3ay from "o3 &a"ue added 'ector' 'uc a' agricu"ture

and natura" re'ource e=traction. 0e&e"o+ed countrie'< in com+ari'on< u'ua""y a&e

economic 'y'tem' !a'ed on continuou'< 'e"f7'u'taining economic gro3t in te

tertiary and uaternary 'ector' and ig 'tandard' of "i&ing -iki+edia 2665.

Su!7Saara African< 8ENA and ,atin American region' are c"a''ified a' emerging

and developing countries a' tey a&e not acie&ed a 'ignificant degree of

indu'tria"i>ation re"ati&e to teir +o+u"ation'< and 3ic a&e< in mo't ca'e' a medium

to "o3 'tandard of "i&ing. Te greate't ca""enge facing te'e region' i' te "ack of

uman ca+acity< +y'ica" infra'tructure and tecnica" ca+acity reuired to con&ert

a!undant re'ource' to 'u'taina!"e !eneficia" gro3t. Tey are de+endent on

immigrant 'ki""' 3ic introduce 'o+i'ticated -e'tern tecno"ogy and conce+t' tat

a"ienate te "oca"' and reuire a minimum "e&e" of education 3ic te +eo+"e cannot

'u++"y. 0uring te conce''ion era< "itt"e attention 3a' +aid to te de&e"o+ment need'

of te'e region' troug !ui"ding of uman ca+acity. No3 tey !e"ie&e tat te

ige't +o''i!"e rate of gro3t of teir countrie' can on"y !e reaced !y te greate't

+o''i!"e de&e"o+ment of teir natura" re'ource' and te 'trengtening of teir a!i"ity

to undertake ti' de&e"o+ment tem'e"&e' Sayeg 15#.

Te unfortunate fact i' tat mo't oi"7ric de&e"o+ing countrie' are under+erformer'

acro'' a 3o"e '+ectrum of economic< 'ocia"< +o"itica" and go&ernance 'tandard'. Ti'

can !e 'een a' a re'u"t of te non7readine'' of te'e countrie' a' of tat time 3ere

reco&ering from co"onia"i'm or emerging from teir traditiona" 'ocietie' to a!'or!

ig "e&e" of +rofe''iona"i'm< tecno"ogy< modern !u'ine'' intricacie' and ca+ita"7

inten'i&e e=+enditure reuired in te oi" and ga' indu'try. Sayeg 15# argue' tat

te oi" indu'try came into region' 3ic ad not de&e"o+ed an indu'tria" tradition of

it' o3n< nor ad it con'tructed "egi'"ati&e and in'titutiona" commitment. Te ca+ita"< SAP< B8-< Adida'< Audi< Por'ceed

a' corner'tone of uman de&e"o+ment< a mean' of e=+anding +eo+"e' ca+a!i"itie' and

coice' and a too" for o&ercoming uman +o&erty. /n te 21'tcentury< kno3"edge i'

a"'o increa'ing"y a dynamic factor of +roduction and a +o3erfu" dri&er of +roducti&ity

and uman ca+ita" 9N0P 266$. Recent"y< te Saudi Ara!ia go&ernment announced

it' "arge't e&er nationa" !udget of SR 1.1 tri""ion 3it uge a""ocation' for educationa"

+ur+o'e' in 'u++ort of te country' !e"ie&e in in&e'ting interna""y and to +re+are

uman re'ource' ca+a!"e of "eading te country' future de&e"o+ment.

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+.6 O"l oo,

/n te ear"y 15)6' te economic 'ituation canged dramatica""y re'u"ting from te

&a't increa'e in re&enue accrued to OPEC +roducer'. Oi" e=+ort e=+anded

'u!'tantia""yL roya"ty +ayment' and ta=e' on foreign oi" com+anie' increa'ed 'ar+"yLand oi" e=+orting go&ernment' !egan 'etting and rai'ing oi" e=+ort' internet 'er&ice.

Saudi Ara!ia' re&enue +er !arre" of oi" a&eraged from tota" +roduction and oi"

re&enue' uadru+"ed from I6.22 in 154 to I6.5 in 15)6. By 15)$< te +rice ad

reaced I1.*# and 'oared to I16 and iger in 15)4 fo""o3ing te Ara! oi" em!argo

introduced to +re''ure -e'tern 'u++orter' of /'rae" during te Octo!er 15)$ 3ar

internet 'er&ice. /n 152< te a&erage e=+ort +rice' +er !arre" of oi" reaced 3e""

a!o&e I$6. Bet3een 15)$ and 156< go&ernment oi" re&enue' %um+ed from I4.$

!i""ion to I161. !i""ion internet 'er&ice.

0uring te oi" 'ock< mu't OPEC nation' 3ere e=treme"y underde&e"o+ed and cou"d

not u'e a"" te money tat 3a' f"o3ing into teir coffer'. So tey in&e'ted it a!road in

Eurodo""ar de+o'it' at internationa" !ank' and in '+ecia" 9S trea'ury 'ecuritie'. Te'e

fund' 3ere e&entua""y "ent out J 'ome in te form of !ig !ank "oan' to ,atin America

J !ut te +rimary effect of te oi" !oom 3a' to take '+ending money a3ay from te

g"o!a" con'umer' 8int> 266#. Te 15)6' oi" !oom dro&e oter nationa" economie'

into a 3or"d3ide rece''ion.

A' com+ared to tree decade' ago 3en OPEC nation' did not kno3 3at to do 3it

teir money< te current oi"7!oom e=+erienced in te 2666' 3a' +ro+er"y and

carefu""y managed. Te difference in te oi" !oom' of te 15)6' and 2666' i' tat

tree decade' ago< +etrodo""ar' 3ere remo&ed from g"o!a" con'um+tion and +ut into

'a&ing' tat de+re''ed g"o!a" demand< !ut in te ear"y 2666' more of te +etrodo""ar'

are !eing '+ent< kee+ing 3or"d3ide economic gro3t !uoyant 8int> 266#. Ti'

time< mo't oi" e=+orting countrie' a&e far more ad&anced financia" 'y'tem'< !igger

+o+u"ation'< and a 3ide array of unmet need' and am!ition'. So tey are '+ending a

!ig 'are of te incoming +etrodo""ar' on e&eryting from in&e'tment in touri'm in

0u!ai to go&ernment %o!' in Saudi Ara!ia. 8ore '+ending eua"' more im+ort'< tat

mean' more %o!' generated e"'e3ere in te 3or"d< from Ne3 ork to Sangai

8int> 266#.

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+.: D&t#- D"sease

Ha""3ood and Sinc"air 151 'tate' tat many oi"7e=+orting countrie' are o+erating a

narro3 oi"7!a'ed economy 3it "imited 'ucce'' in di&er'ifying teir e=+ort' a3ay

from oi". Ti' a' !een de'cri!ed 3it different +ra'e' 'uc a' te K#utch diseasee< de'ign

and im+"ement de&e"o+ment initiati&e' !ut more ca""enging to rea"ign a +re7formed

menta"ity of a +eo+"e.

+.; Waste' W"n'falls

Oi" and natura" ga' are &a"ua!"e commoditie' in ig demand !ut te income deri&ed

from e=+orting !y re'+ecti&e countrie' a' not manife'ted it'e"f in a''ociated

outcome'. :e"!' 155 'tudy of te im+act of te u'e of te 3indfa"" of 15)$ and

15)5 !y 'i= oi"7+roducing countrie' detai"' teir fai"ure to acie&e economic

tran'formation. Te 'i= countrie' are A"geria< Ecuador< /ndone'ia< Nigeria< Trinidad

and To!ago< and ene>ue"a 3ic co""ecti&e"y rea+ed a 3indfa"" of I22.* !i""ion in

15)4< a&eraging a ma''i&e 22.) +er cent of :0P. On"y /ndone'ia< te "ea't oi"7

de+endent of te 'i=< and +o''i!"y Ecuador acie&ed a 'trengtening of non7oi"

'ector' in te +eriod of te t3o +rice !oom'. On"y to'e t3o 'a3 agricu"tura" and food

+roduction ri'e !et3een 15)4 and 15$< and te o&era"" non7oi" economie' of te 'i=

countrie' fe"" 3e"" !e"o3 te norm for de&e"o+ment :e"! 155.

Se""ey 266* 'tated tat te 3indfa"" nature of te oi" earning' of te 15)6' created

+ro!"em' of it' o3n. Te additiona" re&enue' 3ere ma''i&e< immediate and of

indeterminate duration. Te economie' into 3ic te re&enue' came faced

difficu"tie' a!'or!ing tem< 3ic encouraged +rof"igate and inf"ationary '+ending.

Pro%ect' 3ere +oor"y concei&ed and a''e''ed 3ic "ed to +oor +erformance and

3or'ening of in&e'tment. /n Nigeria< ca+acity uti"i>ation in manufacturing< muc of it

go&ernment7o3ned< a&eraged )) +er cent in 15)*< '"id to *6 +er cent in 15$ and a'

'ince fa""en to $*746 +er cent< 'ugge'ting 'ome t3o7tird' of in&e'tment a' !een

3a'ted Se""ey 266*. Ti' 'yndrome 3a' o!'er&ed in mo't oi"7+roducing

de&e"o+ing 'tate' a+art from /ndone'ia 3ic managed it' oi" 3indfa"" re&enue' !y

im+ro&ing 'trong gro3t in it' agricu"tura" and manufacturing 'ector tu' a&oiding

te K0utc di'ea'e.

Te K0utc di'ea'e "ed to +oor"y identified and de'igned +ro%ect' tat did not meet

te countrie' "ong7term e=+ectation' and need'. 8o't of te'e +ro%ect' 3ere o&er7

"arge or 3ite e"e+ant' 3ic te countrie' did not a&e te ca+acity to 'u'tain. /n

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Nigeria< te 3ite e"e+ant of te A%akouta Stee" 8i""' a' aunted Nigeria for

decade'< e+itomi>ing time and !udget o&errun' and redundancy Okonta 0oug"a'

266$.

.< Inf!ast!t&!e De0elo5,ent

/nfra'tructure inc"ude' te"ecommunication< +o3er< +i+ed 3ater 'u++"y< 'anitation and

'e3age< road'< dam'< +ort' and ur!an tran'+ort< 3ic 'a+e' te "ife and determine'

te 'tandard of "i&ing of a +eo+"e. /t i' recogni>ed a' a key faci"itator of economic

de&e"o+ment. /t i' 'aid to nurture economic gro3t< +o&erty a""e&iation< and

en&ironmenta" 'u'taina!i"ity. /t i' to ti' tat de&e"o+ing countrie' in&e't I 266 !i""ion

a year in ne3 infra'tructure te re'u"t a' !een a dramatic increa'e in infra'tructure

'er&ice' for tran'+ort< +o3er< 3ater and 'anitation etc -or"d Bank Re+ort< 2664. /t

i' recorded tat during te +a't fifteen year'< te 'are of ou'eo"d' 3it acce'' to

c"ean 3ater a' increa'ed !y a"f< and +o3er +roduction and te"e+one "ine' +er

ca+ita a&e dou!"ed tere!y rai'ing +roducti&ity and im+ro&ing "i&ing 'tandard'

-or"d Bank 1554.

Te -or"d Bank Re+ort of 1554 a' e'ta!"i'ed tat adeuacy of infra'tructure e"+'

determine one country' 'ucce'' and anoter' fai"ure J in di&er'ifying +roductionen'

are im+o&eri'ed.

.1 Inf!ast!t&!e an' Se!0"#e Del"0e!(

Te ra+id ri'e in oi" re&enue' in te oi" State' +roduced an era of un+recedented

infra'tructura" de&e"o+ment. /n&e'tment in im+ro&ed +y'ica" infra'tructure 3a'

3e"come in te Ara! oi" State' 'ince it im+ro&ed te ua"ity of "ife of teir +o+u"ation

A Study on Niger Delta Development Commission(Msc Thesis) vs 1997

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