Oiling development

OECD Observer

Another resource which Africa is perhaps less noted for is oil. And it could become a serious source of finance for development in certain countries.

With a total estimate of more than 100 billion barrels, Africa held nearly a tenth of the world’s oil reserves in 2003. There are a total of 13 oil-producing countries on the continent. Nearly half of these are in north Africa.

For the African Economic Outlook, oil producers in sub-Saharan Africa can be divided into three categories; the old ones where production is in decline are Congo, Cameroon and Gabon. Then there are those where production is still on the increase: Angola and Nigeria, which is the continent’s biggest producer. The new members of the club are Equatorial Guinea, Chad and São Tomé.

OPEC member Nigeria is one of the top ten oil producers in the world, with an output of over 2 million barrels per day. Moreover, according to the IEA, west Africa, together with Latin America, will contribute to most of the non-OPEC production increase until 2030. Africa as a whole is expected to see an increase in oil supply of 4.9 million barrels per day by 2020.

So how can this strong position be used for development? Many oil countries have suffered from the so-called “oil curse”, finding themselves heavily indebted and impoverished. According to the African Economic Outlook, some oil-producing countries are now seeking to take advantage of the high prices prevailing since 2003, to make better use of surplus revenue from this windfall and to improve transparency and governance in the oil sector.

A first step is cleaning up corruption. Some countries have signed up to the Extractive Industries Transparency Initiative (EITI), a programme that encourages governments and private companies to share information regarding their oil income. Several nations now have specific regulations for the use of oil revenue. In Nigeria and Congo, the budget is based on a very conservative estimate of the price of oil. Any surplus is deposited in a special account with the central bank.

In Algeria, the government’s budget for 2005 calls for a significant reduction of the primary non-oil deficit in order to reduce the government’s dependence on volatile oil income. Of course, high oil prices mean recent windfall gains for some, but because they mean higher import prices, many African oil importers will still see them as a curse. RJC

©OECD Observer No 249, May 2005

Economic data

GDP growth: +0.6% Q1 2019 year-on-year
Consumer price inflation: 2.3% May 2019 annual
Trade: +0.4% exp, -1.2% imp, Q1 2019
Unemployment: 5.2% July 2019
Last update: 8 July 2019


Stay up-to-date with the latest news from the OECD by signing up for our e-newsletter :

Twitter feed

Subscribe now

<b>Subscribe now!</b>

To order your own paper editions,email Observer@OECD.org

Online edition
Previous editions

Don't miss

  • MCM logo
  • The following communiqué and Chair’s statement were issued at the close of the OECD Council Meeting at Ministerial level, this year presided by the Slovak Republic.
  • Food production will suffer some of the most immediate and brutal effects of climate change, with some regions of the world suffering far more than others. Only through unhindered global trade can we ensure that high-quality, nutritious food reaches those who need it most, Angel Gurría, Secretary-General of the OECD, and José Graziano da Silva, Director-General of the United Nations Food and Agriculture Organization, write in their latest Project Syndicate article. Read the article here.
  • Globalisation will continue and get stronger, and how to harness it is the great challenge, says OECD Secretary-General Gurría on Bloomberg TV. Watch the interview here.
  • OECD Secretary-General Angel Gurría with UN Secretary-General António Guterres at the 73rd Session of the UN General Assembly, in New York City.
  • The new OECD Observer Crossword, with Myles Mellor. Try it online!
  • Listen to the "Robots are coming for our jobs" episode of The Guardian's "Chips with Everything podcast", in which The Guardian’s economics editor, Larry Elliott, and Jeremy Wyatt, a professor of robotics and artificial intelligence at the University of Birmingham, and Jordan Erica Webber, freelance journalist, discuss the findings of the new OECD report "Automation, skills use and training". Listen here.
  • Do we really know the difference between right and wrong? Alison Taylor of BSR and Susan Hawley of Corruption Watch tell us why it matters to play by the rules. Watch the recording of our Facebook live interview here.
  • Has public decision-making been hijacked by a privileged few? Watch the recording of our Facebook live interview with Stav Shaffir, MK (Zionist Union) Chair of the Knesset Committee on Transparency here.
  • Can a nudge help us make more ethical decisions? Watch the recording of our Facebook live interview with Saugatto Datta, managing director at ideas42 here.
  • The fight against tax evasion is gaining further momentum as Barbados, Côte d’Ivoire, Jamaica, Malaysia, Panama and Tunisia signed the BEPS Multilateral Convention on 24 January, bringing the total number of signatories to 78. The Convention strengthens existing tax treaties and reduces opportunities for tax avoidance by multinational enterprises.
  • Globalisation’s many benefits have been unequally shared, and public policy has struggled to keep up with a rapidly-shifting world. The OECD is working alongside governments and international organisations to help improve and harness the gains while tackling the root causes of inequality, and ensuring a level playing field globally. Please watch.
  • Checking out the job situation with the OECD scoreboard of labour market performances: do you want to know how your country compares with neighbours and competitors on income levels or employment?
  • Trade is an important point of focus in today’s international economy. This video presents facts and statistics from OECD’s most recent publications on this topic.
  • The OECD Gender Initiative examines existing barriers to gender equality in education, employment, and entrepreneurship. The gender portal monitors the progress made by governments to promote gender equality in both OECD and non-OECD countries and provides good practices based on analytical tools and reliable data.
  • Interested in a career in Paris at the OECD? The OECD is a major international organisation, with a mission to build better policies for better lives. With our hub based in one of the world's global cities and offices across continents, find out more at www.oecd.org/careers .
  • Visit the OECD Gender Data Portal. Selected indicators shedding light on gender inequalities in education, employment and entrepreneurship.

Most Popular Articles

OECD Insights Blog

NOTE: All signed articles in the OECD Observer express the opinions of the authors
and do not necessarily represent the official views of OECD member countries.

All rights reserved. OECD 2019