In its desperation to get a willing buyer of its crude oil and gas, Nigeria has concluded arrangement to turn to China following reports that the export to the United States, its major buyer, has dropped significantly.
To that effect, Minster of State, Emmanuel Ibe Kachikwu, said plans were in top gear for Nigeria to host a high powered Chinese delegation to visit the country in mid-October 2016
He said that the main attraction in the mission is to give final touches to the memorandum of understanding (MOUs) worth $80 billion, signed in June between the two countries on investment in Nigeria’s oil and gas infrastructure.
“We’ve had almost a year period to work on this and we had expected that some of the investments would have come earlier,” Kachukwu said.
But it is the opinion of experts that the renewed zeal by Nigeria in channeling its economy towards the Asian countries, especially China, is partly the cause of its current economic meltdown, which has seen it into recession with lingering scarcity of dollar.
They are quick in recalling that government has already had agreement with China to make the naira convertible to Chinese currency, the Yen, during the signing of the $200 billion soft loan from that country in May 2016.
But officials defend the Nigeria-China economic ties on the fact that the West had made it difficult for OPEC to enjoy good price of oil from its members, of which Nigeria, until recently was the third biggest oil producer.
Nigeria relies on crude sales for about 80 per cent of its national revenue, which the unresolved crisis in the Niger Delta, the oil region, has denied the country its production quota of 2.2 million barrels per day since May.
To worsen the situation, Nigeria’s four refineries are dysfunctional most part of the year due to poor maintenance, which forces it to rely on imported fuel for both industrial and domestic uses.
As at last count, the country had approached more than three international financial institutions for loan to fund its 2016 budget without success due to harsh economic reforms demanded by the international bodies.
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