State any three positive and any two negative effects of petroleum industry on the economy of Nigeria.
Explanation
Positive effects of petroleum industry on the economy of Nigeria are:
(i) The development of basic infrastructural base for developmental purposes.
(ii) Provision of internal energy requirement, e.g. kerosene, gas.
(iii) Provision of revenue in form of petroleum tax/sales of petroleum products.
(iv) It is a source of foreign exchange.
(v) Many people have been gainfully employed in the industry.
(vi) Emergence of petroleum has led to the establishment of petrochemical industry in the country and some other allied industries such as liquified natural gas industries.
Negative effects of Petroleum industry on the economy of Nigeria are:
(i) The presence of oil and its wealth has escalated social vices such as corruption, armed robbery, etc.
(ii) Oil exploration in Nigeria has caused ecological problem like pollution.
(iii) Nigeria has become mono-economy. Other sectors like agriculture have been relegated to the background.
(iv) Another major effect is the problem of rural - urban migration.
(v) The discovery of oil led to rapid monetary expansion which has caused a high rate of inflation.