INEQUALITY IN NIGERIA
INEQUALITY IN NIGERIA EXPLORING THE DRIVERS
Despite the prevailing recession, Nigeria is still seen as Africa’s largest economy and one of the fastest-growing in the world. Yet, more than half of the Nigerian population still grapples with extreme poverty, while a small group of elites enjoys ever-growing wealth. This report provides a picture of the current state of poverty and economic inequality in Nigeria, identifies the main drivers of this situation and presents some policy solutions.
Over the past 40 years, the gap between the rich and the poor has been growing in developed and developing countries alike.1 In 2015, just 62 people had as much wealth as the poorest half of humanity, and the richest one percent owned more wealth than the rest of the world combined.2 At the same time, the poorest people are being denied their fair share: since the turn of the century, the poorest half of the world’s population has received just one percent of the total increase in global wealth.
In Nigeria, the scale of economic inequality has reached extreme levels, and it finds expression in the daily struggles of the majority of the population in the face of accumulation of obscene amounts of wealth by a small number of individuals. While more than 112 million people were living in poverty in 2010,4 The richest Nigerian man will take 42 years to spend all of his wealth at 1 million per day.
According to Oxfam’s calculations, the amount of money that the richest Nigerian man can earn annually from his wealth is sufficient to lift 2 million people out of poverty for one year.6 Lifting all Nigerian people living below the extreme poverty line of $1.90 out of poverty for one year will cost about $24 billion. This amount of money is just lower than the total wealth owned overall by the five richest Nigerians in 2016, which was equal to $29.9 billion.
Poverty in Nigeria is particularly outrageous because it has been growing in the context of an expanding economy where the benefits have been reaped by a minority of people, and have bypassed the majority of the population. Annual economic growth averaged over 7% in the 2000s,8 and yet Nigeria is one of the few African countries where both the number and the share of people living below the national poverty line over that period, increased from 69 million in 2004 to 112 in 2010, equivalent to 69% of the population. In the same period, the number of millionaires increased by approximately 44%. Income inequality, as measured by the Gini Index, grew from 40% in 2003 to 43% in 2009.
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