Describe the contributions of natural resources to the economy of your country.

Answer Details

Natural resources are the free gifts of nature (minerals, land, forests, rivers, wildlife) available for production. In an economy such as Nigeria's they contribute in the following ways:

• Source of government revenue: royalties, rents and taxes from oil, gas and solid minerals form a large part of public income.
• Foreign exchange earnings: exports of crude oil and other resources earn the foreign currency used to pay for imports.
• Employment: mining, oil, agriculture, fishing and forestry provide jobs for many people.
• Raw materials for industry: minerals and agricultural produce feed local manufacturing, for example crude oil for refineries and petrochemicals.
• Provision of energy: oil, gas and hydro resources supply power for homes and industries.
• Basis for industrialisation and infrastructure: resource revenue finances roads, schools, hospitals and industrial projects.
• Food and export crops: fertile land supplies food and cash crops such as cocoa and rubber.
• Attraction of foreign investment into extractive and processing industries.
• Contribution to national output (GDP) and to overall economic growth.

Thus natural resources support the economy through revenue, foreign exchange, employment, raw materials, energy and growth, provided they are efficiently exploited and the earnings well managed.