The Political Economy of Oil and Its Role in Enhancing Development in Africa: a Case Study of Nigeria and Angola

Abstract

The purpose of the study was to examine the political economy of oil and its role in enhancing development in Africa, using case studies of Nigeria and Angola. The study attempted to apply the World Systems Theory developed by Immanuel Wallerstein in its theoretical framework. The Theory tries to bring a better understanding in International Studies on the relations between the developed and the less developed economies. The Theory is premised on the division of the International System into three categories- the Core, the Semi-periphery and the Periphery. In this study the countries of Nigeria and Angola can be said to be in the periphery of the world economic order. The study was also guided by research questions; how has the oil sector been managed in Nigeria and Angola, how has development in Nigeria and Angola been impacted by the oil sector, and what strategies have been put in place to improve the oil sector in Nigeria and Angola. The study used both quantitative and qualitative methods of inquiry to collect relevant data from respondents in Nigeria and Angola. The study made use of questionnaire interviews with international oil companies, non-governmental organizations, State Oil owned Corporations: Nigeria National Petroleum Corporation and Angolan National Oil Corporation and heads of department of ministry of petroleum in Nigeria and Angola. The study reviewed vast literature on the subject of study, published and unpublished documents were also reviewed. The study established that in the oil producing countries politics dominates the oil industry, that the management of oil sector in Nigeria and Angola is still developing and that the sector is managed and controlled by political elites. The bodies responsible for managing the oil sector, Nigerian National Petroleum Corporation and Angola Sonangol are political institutions characterized by high degree of corruption. The study revealed that the oil producing countries, Nigeria and Angola yet to achieve development from the oil revenue. The two countries have been afflicted by the resource curse and the ‘Dutch Disease’. Development is lagging behind and the two countries have failed to tackle poverty which has become pervasive and a source of frequent conflicts especially in Nigeria. Finally, the study established that Nigeria and Angola are introducing strategies to improve the oil sector, but this has not achieved much. In recommendation, the governments in oil producing countries need to adopt a culture of transparency and accountability in the oil industry.