Nigeria has one of the world’s highest economic growth rates, averaging 7.4% according to the Nigeria economic report released in July 2014 by the World Bank. Poverty may have been overestimated because the country’s economy is now being understood more and more. Poverty still remains significant at 33.1% in Africa’s biggest economy. For a country with massive wealth and a huge population to support commerce, the level of poverty remains unacceptable.over the last decade), a well-developed economy, and plenty of natural resources such as oil.
Poverty in Nigeria can also be caused by the political instability of the country. However, these programs have largely failed to overcome the three reasons for this persistent poverty: income inequality, ethnic conflict, and political instability.
Income inequality worsened from 0.43 to 0.49 between 2004 and 2009. This is correlated with differential access to infrastructure and amenities. In particular, there are more rural poor than urban poor. This results from the composition of Nigeria’s economy, especially the energy (oil) and agriculture sectors. Oil exports contribute significantly to government revenues and about 15% of GDP, despite employing only a fraction of the population. Agriculture, however, contributes to about 45% of GDP, and employs close to 90% of the rural population.
This incongruence is compounded by the fact that oil revenue is poorly distributed among the population, with higher government spending in urban areas than rurally. High unemployment rates renders personal incomes even more divergent. Moreover, the process of oil extraction has resulted in significant pollution, which further harms the agricultural sector.
The United States Government, through its Agency for International Development (USAID), on Tuesday announced $92.73 million in additional developmental assistance to support the five-year $2.3 billion agreement signed with the Nigeria Government in 2015.
This, according to a statement by the U.S Consulate, brings total of development assistance provide to $474.74 million.
The additional funding is expected to help Nigeria reduce extreme poverty in a more stable, democratic society by stimulating inclusive economic growth, promoting a healthier, more-educated population, and strengthen good governance.
“Today we are pleased to contribute additional funding in support of the agreement signed with the Nigerian Government in 2015,” the statement quoted USAID Mission Director, Michael Harvey.
“With their leadership we know this funding will have a significant impact on the wellbeing of Nigerians,” he added.
In an effort to align Nigeria’s development plans with sector-specific strategies, USAID collaborated with the Nigerian Ministry of Budget and National Planning; the Nigerian ministries of health, agriculture, power, and education; and state-level government counterparts to structure the agreement, which is in place until 2020.
In addition to the developmental funding, the United States provides humanitarian assistance to people affected by the ongoing conflict and severe food insecurity in Nigeria and throughout the Lake Chad Basin. Since fiscal year 2015, the United States has provided more than $366 million in humanitarian assistance and continues to be the single largest bilateral humanitarian donor to the region.