Oil-Rich and Dirt-Poor: Identifying Business Threats and Opportunities in Nigeria

Abstract

An economic mystery plagues several developing nations. The mystery is why some nations with significant mineral wealth such as oil, iron ore, gold, and diamonds also tend to have extremely high rates of poverty. A prime example of this paradox is Nigeria. It is one of the largest African economies with an estimated gross domestic product (GDP) of over US$500 billion, yet the poverty rate is estimated at 60% of the population. Some economists call this paradox the natural resource curse. By understanding the causes of the curse, investors and businesses can determine when and where to invest in these nations. In this case study, we analyze the political and economic factors that may cause the natural resource curse in Nigeria. We then use these factors to identify the opportunities, threats, and strategies that businesses must consider before investing in mineral rich/high poverty nations.

This case was prepared for inclusion in Sage Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.

2024 Sage Publications, Inc. All Rights Reserved

You are not authorized to view Teaching Notes. Please contact your librarian for instructor access or sign in to your existing instructor profile.
locked icon

Sign in to access this content

Get a 30 day FREE TRIAL

  • Watch videos from a variety of sources bringing classroom topics to life
  • Read modern, diverse business cases
  • Explore hundreds of books and reference titles