A tale of two oil exporting countries!

Nigerians are very resilient people. That is the only explanation for the economy’s ability to trudge on despite the near collapse of the power sector and the 70 per cent drop in crude oil revenue.  Things have never been this bad.

Power supply has plummeted to an all-time low courtesy of the gunmen in the Niger Delta who are black mailing the federal government for juicy pipelines surveillance contracts.
The economies of some oil exporting countries with higher oil revenue and lower population than Nigeria are on the verge of collapse due to the crisis in the oil industry.  Ironically, Nigeria’s economy still lumbers along.  The hard time plaguing oil exporting countries, compels an analogy between Nigeria and Venezuela, two leading members of the Organisation of Petroleum Exporting Countries (OPEC).
Venezuela, a South American country of 30 million people produces 2.42 million barrels of oil per day.
Nigeria has a population of 170 million and an oil output of 2.2 million barrels per day.

In the last three months Nigeria’s oil output has plummeted precipitously as gunmen in Niger Delta attack oil facilities and gas pipelines thus returning the country to its inglorious days of eternal darkness.
The country’s oil production capacity has plummeted to a 20-year low of 1.4 million barrels per day.
Venezuela has practically no oil production challenges.  However, it has its own tale of economic woes. While Nigeria’s economy is suffering from human-inflicted calamities, the economy of Venezuela is tormented by natural disaster and plummeting oil revenue.  Nigeria is in prolonged darkness because of the activities of the gunmen in Niger Delta. Venezuela is in dense darkness because a debilitating drought has crippled the country’s hydro-power plants.

But Venezuela’s power situation is worse than Nigeria’s.  Civil servants have been ordered to report for duties only twice in a week as no one could guarantee power supply beyond that.  Unlike Nigerians who generate 70 per cent of their power supply, Venezuelans probably depend totally on public power supply. Nigeria has long been known as an economy running on private power generators. Even the seat of power in Aso Rock spends billions of naira annually on fuel and servicing of giant generators. Every ministry and government department has huge budget for power generators and fuel.  There is no way a Nigerian government can tell its workers to stay at home because of power failure.  The economy now depends more on private power generators while public power supply remains on stand-by.  Nigeria’s economy is under severe stress, but it is not in a state of emergency like the case in Venezuela.  Civil servants go to work five days a week even as some of the states owe more than five months salary.

Venezuela’s economy is on the verge of collapse even as it earns more from oil exports than Nigeria which has a population five times that of Venezuela.  The population of Venezuela is just about that of Lagos and Ogun states.  The inflation rate in Venezuela is 720 per cent.  It is so bad that as a consumer is pricing a commodity in the market, the price is changing rapidly. Nigeria’s inflation rate as at the last count was a scant 13 per cent.  The inflation rate was escalated by the hike in transport fares and prices of food items due to the deregulation of the downstream sector of the oil industry.

Nigeria imports more than 90 per cent of its refined petroleum products.  Venezuela on the other hand has one of the largest refineries in the world and is practically self-sufficient in refined petroleum products, yet the country’s retail shops are empty.  People queue for essential items from morning to night just as Nigerians queued for fuel three weeks ago.
The economy of Nigeria is stronger than that of Venezuela because Nigerian people are self-reliant.  The managers of Nigeria’s economy are not better than their counterparts in Venezuela. The truth is that Nigerians do not depend on their government.  Nigerians generate 70 per cent of their power supply and sink boreholes if they want good water.  They build and maintain roads in their communities.

Venezuela on the other hand was a welfare state under the late President Hugo Chavez.  The late president provided practically everything for the people and ended up making them too dependent on government.  Now that the oil revenue has dried up most of the people are finding it difficult to fill the void.
Nigeria and Venezuela are almost in the same boat.  The two OPEC members are broke. Venezuela is in a more dangerous economic precipice than Nigeria.  It is obvious that Nigeria and Venezuela did not safe for the rainy day.  The government of Venezuela squandered revenue from the oil boom of 2009 to 2014 on the people’s welfare.

Nigerian governments squandered the oil boom income on the indecent opulence of the ruling class.
Venezuelans have very little reason to complain now that the day of reckoning has arrived.  They enjoyed when the going was good.  Nigerians on the other hand have every reason to complain about those who ruled the country during the oil boom years but failed to fix the decaying infrastructure.