By Rachel Savage
![Nigeria-naira-towel-R-780](https://assets.euromoneydigital.com/dims4/default/04a4ce4/2147483647/strip/true/crop/780x520+0+0/resize/800x533!/quality/90/?url=http%3A%2F%2Feuromoney-brightspot.s3.amazonaws.com%2F74%2F66%2F40cc316dc1d4a7fe1dcbc76c1e9e%2Fnigeria-naira-towel-r-780.gif)
Nigeria’s economy is hooked on the oil that oozes from beneath the soil and creeks of its southern Delta region.
The oil and gas sector accounts for more than 90% of exports and, until 2014, contributed around 80% of government revenues. So it was to be expected that west Africa’s most populous nation would struggle when the oil price fell from above $110 a barrel in 2014 to as low as $29 at the start of 2016.
The crisis was made worse by the Central Bank of Nigeria’s (CBN) currency controls; in early 2017, these resulted in naira being traded on the black market for dollars at a rate that was 70% weaker than the official one.
The economy shrank for five consecutive quarters from the beginning of 2016, marking Nigeria’s first recession in 25 years. And the recovery – with growth of less than 1% in 2017 – has been almost as painful.
It was expected too that any fall in oil prices would hit Nigeria’s banks. After all, 45% of their lending is to the oil and gas sector, according to an IMF report released in March.