NIGERIA ECONOMY AND CLIMATE INFORMATION

Economy
Nigeria is Africa’s largest oil producer; the industry earns 90% of the
country’s export income and has underpinned its economy for decades.
Nigeria also has commercially viable quantities of tin, coal, iron ore, zinc
and some uranium, plus substantial but as yet largely untapped reserves
of natural gas and coal.

Agriculture occupies well over half of the population, who produce rice,
maize, cassava, sorghum and millet as staples, as well as groundnuts,
cocoa, palm oil and rubber as cash crops. Timber and livestock rearing
have both developed during the last 20 years. Nonetheless, successive
governments have failed to restore Nigeria’s one-time self-sufficiency in
food.

Manufacturing was established during the 1960s, principally with oil

money, and now includes food processing and the production of vehicles,
textiles, pharmaceuticals, paper and cement.

Per capita GDP is around US$690 annually, which is improved but still not
desirable. As a condition of the rescheduling, the government has begun
to put into effect economic reforms, including the sale of major state-
owned industries.

Climate
Temperatures throughout Nigeria are generally high; diurnal variations are
more pronounced than seasonal ones. Highest temperatures occur during
the dry season; rains moderate afternoon highs during the wet season.
Average highs and lows for Lagos are 31° C and 23° C in January and 28°
C and 23° C in June. Although average temperatures vary little from
coastal to inland areas, inland areas, especially in the northeast, have
greater extremes. There, temperatures reach as high as 44° C before the
onset of the rains or drop as low as 6° C during an intrusion of cool air
from the north from December to February.

Inland, there are two distinct seasons: a wet season from April to October,
with generally lower temperatures, and a dry season from November to
March, with midday temperatures that surpass 38°C (100°F) but relatively
cool nights, dropping as low as 12°C (54°F). On the Jos Plateau,
temperatures are more moderate.

Average rainfall along the coast varies from about 180 cm (70 in) in the
west to about 430 cm (170 in) in certain parts of the east. Inland, it

1
decreases to around 130 cm (50 in) over most of central Nigeria and only
50 cm (20 in) in the extreme north.

Two principal wind currents affect Nigeria. The harmattan, from the
northeast, is hot and dry and carries a reddish dust from the desert; it
causes high temperatures during the day and cool nights. The southwest
wind brings cloudy and rainy weather.

The Need for the Project

In a year (2008) that has seen great turmoil in the world economy and
financial markets, Nigeria was still able to attract a respectable amount of
foreign and local investment. Examples of companies showing their faith
in Nigeria's economy are no longer a few isolated cases. Many well-
established multi-nationals turned to the country to ensure future growth
as their traditional markets became saturated.

But I shall limit this report to Energy and Mining & Metal
 NIGERIA ECONOMY AND CLIMATE INFORMATION

Energy

The area where Nigeria can certainly do with as much investment as

possible is the energy sector. Even though President Yar'Adua (current
president of Nigeria) appointed a Presidential Committee for the
Accelerated Expansion of Nigeria's Power Infrastructure there still seems
to be no clear plan of action on the table. The country currently generates
around 1,800 megawatts (MW), a figure government wants to increase to
6,000 MW by 2009. According to former president Olusegun Obasanjo,
Nigeria needs 100,000 MW to become a fully industrialised country.

A number of state governments have taken the responsibility on

themselves to improve the power situation in their respective states. One
of the high profile foreign investments in the sector came from South
African company Group Five which received a $62 million contract to
design, supply and install a 130 MW power station in Abia State's capital
Aba. In 2005 Group Five also successfully completed the first stage of a
power station in Akwa Ibom State.
In line with international trends, 2008 saw a number of investments in
power generation using renewable sources. The Nigeria Special Climate
Change Unit set a target of moving 20% of the country's electricity users
to renewable energy sources by 2012. Lagos State has shown its
commitment to green energy by partnering with Africa Global Services
Ltd. to power all the new BRT bus stops with solar power. The state is also
planning to use the sun's energy to illuminate highways, bridges, streets
and junctions. UK-based power producer, Revonergy signed a
memorandum of understanding with the Ondo State Government to built
a 14 MW power plant that will use wood waste and sawdust as a source
for electricity.

Mining and Metals

Considering its large number of solid mineral resources, Nigeria has thus
far received fairly little foreign investment in this area. In September this
year, Minister of Mines and Solid Minerals, Chief Sarafa Tunji Oshola
presented the new mineral map for Nigeria. Sophisticated technology was
used to identify the occurance of minerals in 24 of Nigeria's 36 states,
with the outstanding information expected in March in next year. During
April 2009, the Yan Tai Non-ferrous Metal Company of Shanghai
arrived in Osun State to commence with a gold mining operation to which
it committed N1 billion ($7.7 million). Russian Aluminium (RUSAL), the
world's largest aluminium producer which took over the Aluminium
Smelter Company of Nigeria (ALSCON) in 2007 continued with the
rehabilitation of the facility and plans to return the plant to full production
by 2010. The Sokoto State Government is currently also finalising a deal
with China-based Zhonghao Overseas Construction Engineering
Limited to establish the state's second cement factory.