Introduction
Northern Nigeria holds untapped resources that could drive substantial economic growth and development in the region. Key sectors such as agriculture and mining offer significant opportunities for job creation, wealth generation, and the upliftment of communities struggling with poverty and underdevelopment.
Background
Northern Nigeria, comprising 70% of the country’s landmass and a significant portion of its population, is blessed with abundant mineral and agricultural resources. Despite this, political instability, including rising insecurity in the Northeast and widespread banditry, has exacerbated poverty, leaving many children out of school and numerous graduates unemployed.
Nigerian Economic Outlook
The Central Bank of Nigeria projects a GDP growth of 3.76% in 2024, slightly higher than the anticipated 3.75% for 2025. This optimistic forecast is fueled by recent government reforms aimed at revitalizing the economy, including structured increases in crude oil prices and production. Reforms in the mining and energy subsectors are expected to further catalyze growth. Additionally, increased petroleum motor spirit output from both government and private refineries is likely to bolster consumer confidence and purchasing power.
From 2000 to 2014, Nigeria experienced robust economic growth, averaging 7% annually, driven by favorable global conditions and initial reforms. However, between 2015 and 2022, growth rates declined, and GDP per capita stagnated due to monetary policy distortions, rising fiscal deficits, and external shocks such as the COVID-19 pandemic. By February 2024, inflation had surged to a 24-year high of 31.7%.
Northern Nigerian Economic Outlook
Northern Nigeria faces significant economic challenges, including high unemployment, pervasive poverty, and a growing number of out-of-school children. The region is economically disadvantaged compared to the rest of the country, with 87% of Nigeria’s poor residing in the North. Limited access to education and basic infrastructure, coupled with the displacement of over 2.9 million people due to insecurity, exacerbates these issues.
Before the discovery of oil, the North’s agricultural sector, particularly cash crops like groundnuts and cotton, contributed over 60% of Nigeria’s foreign exchange earnings. Livestock and animal husbandry also play a vital role in the nation’s GDP. Despite its vast mineral resources, the region’s mining sector remains underdeveloped. However, recently discovered hydrocarbon deposits in Bauchi and Nassarawa states, along with significant gold reserves, present new avenues for economic development.
Situation Analysis
Northern Nigeria offers substantial investment opportunities, particularly in the oil and gas sector and in the extraction of minerals like gold, uranium, limestone, phosphate, granite, and lead/zinc. The discovery of oil in Bauchi and Nassarawa states highlights the region’s potential. However, security concerns, including banditry and insurgency, pose significant risks. The large population of unskilled and unemployed youths further complicates the investment landscape.
Investment Opportunities
Agriculture and Agro-Allied Industries
Northern Nigeria is a powerhouse of agricultural production, generating over 3 million tonnes of cash crops annually. However, the region mainly exports raw nuts rather than processed goods. With the global edible nut market valued at approximately $3 trillion, Nigeria could significantly benefit from processing and exporting finished products.
Animal husbandry also presents vast opportunities, particularly in meat and milk production, leather industries, and exports to the Middle East.
Solid Minerals
The North’s rich mineral deposits, including gold, lithium, phosphate, and granite, are largely untapped. The recent discovery of oil and gas in Bauchi and Nassarawa states marks a major breakthrough for the region. The oil and gas sector could also support the establishment of fertilizer processing plants, which would enhance agricultural productivity and reduce reliance on foreign exchange.
Mambila Hydroelectric Power Station
The Mambila hydroelectric power project, with a capacity of 3,050 MW, is set to become Nigeria’s largest power-generating installation and one of the largest in Africa. Located in Taraba State, this project could stabilize the region’s power supply, driving industrialization and economic growth in Northern Nigeria.
Transport Infrastructure
Proposed rail infrastructure projects across the Northwest and Northeast, extending to Niger and Chad, are expected to create millions of jobs and enhance regional economic integration. These projects will promote economic balance between the North and South and facilitate the movement of goods and servicens.
Manufacturing
New Nigerian Development Company(NNDC) is the special purpose vehicle established mainly to drive rapid industrialization process of Northern Nigeria. It facilitated and pioneered the establishment of major manufacturing companies in North by taking advantage of the regions vast endorment of natural resources in Agriculture which enabled it to establish Textile Mills in the region such as KTL, Nortex and Arewa Textiles. It also played a key role in establishment of a Ceramic Manufacturing Company in Kano using the regions availability of non metallic minerals deposits. Limestone deposits in the regions opened investment opportunities for the establishment of Sokoto Cement and Ashaka Cement respectively.
NNDC actively participated in the establishment of Nigeria’s Capital Market and the subsequent establishment of Nigerian Stock Exchange as a self regulating agency where companies are listed on the exchange for the purpose of trading their shares on the floor of the Exchange.
The 1973 indigenization decree and subsequent Privatisation and Commercialisation of state owned enterprises enabled NNDC to play a pivotal role in both exercises.
Similarly, the company acquired 0PL 809 and OPL 810 l licence in prospecting for hydro carbon deposits in Kolamani Oil Well a long side the one in Lower Benue Tarrow.
NNDC needs to be supported and encourage by its shareholders as an investment entity not a political organization. The majority shareholders should ensure their investment is not undermined by political consideration. The company should be allowed to chart it’s course as a development finance institutions in order to salvage the regions economic opportunities from being explored and tapped.
In the present circumstances the company should focus it’s attention and priority in resuscitating the closed and moribund companies that hold the potential of reviving cash crops farming as raw materials for the industries that forced to close shop.
Industrialisation is the only way to pull the region out of poverty through the enhancement of the strategic linkages between industry and Agriculture.
The commercial quantity of Kolamani Oil discovery will create series of business opportunities in the value chain which stands out as the key that will unlock the vast investment opportunities for job creation and wealth generation for the region and it’s people.
Conclusion
The recent discovery of oil in Bauchi and Nassarawa states, coupled with Northern Nigeria’s vast agricultural potential, presents significant opportunities for economic growth. The Mambila hydropower project will provide the necessary electricity to fuel the region’s industrialization. Public-private partnerships will be essential in realizing these opportunities and unlocking the region’s economic potential.
Mahmud Shuaibu Ringim
HALIM Consulting Ltd
mahmudshuaibu44@gmail.com
