She claims that because the oil and gas industry is no longer as lucrative as it once was, the new and re-elected governors must look into alternative revenue sources.
“We need to start preparing now for a time when our oil and gas will no longer serve us as the main sources of revenue. States heavily dependent on FAAC allocation will be particularly hit,” the WTO director general said.
“It is important that you governors start now to diversify your revenue sources. We ought to be seeking to double our growth rate and sustain that higher growth until we attain upper middle-income status,” she added.
Nigeria’s Finance Minister, Dr. Zainab Ahmed, had said during a public presentation and breakdown of the 2023 Appropriation Act in January 2023, that the total revenue available to fund the 2023 budget is estimated at N10.49 trillion, and the government expects 22% of the projected revenues from oil-related sources, while 78% is anticipated from non-oil sources.
Similar remarks were made by billionaire industrialist Tony Elumelu, who was also in attendance, he noted that Nigeria has to move beyond oil and gas. He used Singapore as an illuminating example. He stated: “Look at Singapore, a country with 6 million people, no oil, no abundance of natural resources, just human resources and purposeful leadership. Today, the per capita gross domestic product (GDP) stands at $55,000, up from $500 in 1965, making the country one of the most developed countries in the world.”
Dr. Ngozi Okonjo Iweala’s comments are in line with the current turn of events in Nigeria’s oil and gas sector. For the past year, Nigeria has continually experienced a decline in its daily oil output. By extension, the revenue generated from oil has also decreased, as crude oil theft and vandalism continue to pose an insoluble problem for the Nigerian government.
As recently as a few days ago, the Organization of the Petroleum Exporting Countries (OPEC) reported that Angola has surpassed Nigeria to grab the top spot among oil-producing African countries. And even a month prior when Nigeria lead Africa in crude oil production at 1.268 million barrels per day (bp/d) in March, it fell behind its OPEC quota of 1.8 million bp/d and its 2023 budget benchmark of 1.6 million bp/d.
On the flip side, the much-anticipated launch of Dangote Group's refineries, the refinery built by Nigeria's richest man Aliko Dangote is a few days from becoming a reality. This project is anticipated to support attempts by the federal government to make the nation independent in the local refining of crude oil in order to conserve the limited foreign currency needed in the importation of petroleum products. The Dangote Refinery, the biggest single-train refinery in the world, will have a daily capacity of up to 650,000 barrels.