Because Abuja owns the oil and gas (extraction is done through joint arrangements between private oil companies and the government-owned Nigerian National Petroleum Corporation), the easy way to wealth is through state capture at the various levels of government. The money is then dispersed through pervasive patronage networks, with little going into entrepreneurship or economic development. As a result, oil (now joined by natural gas) has sucked the energy out of other parts of the economy while creating few jobs
In the countryside, agriculture and fishing employ a majority of Nigerians, but attract scant investment. Particularly in the North, families increasingly send their children to the cities because agriculture cannot support the expanding rural population. Ostensibly, these children go to study the Koran under a malam, a Koranic teacher, but many end up begging to keep themselves alive. Often, they join the rapidly growing urban masses without permanent employment.
This rapid urbanization is continuing without the necessary investment in infrastructure. Already, about half of the population lives in cities, and a report by the U.S. Institute of Peace estimates that Lagos, Nigeria's commercial center, is likely to become the third largest city in the world by 2015, behind Tokyo and Mumbai. But the cities are not generating jobs. Manufacturing is declining; the result of a collapsed power sector, over-valued currency, and the cheap imports, especially textiles, that flood the domestic market, sometimes with the connivance of corrupt customs officers.
Nigeria's pervasive poverty and underdevelopment are nation-wide, but much worse in the northern half of the country, contributing to the increasing isolation of the predominately Muslim states found there. This sense of isolation was exacerbated by the April 2011 elections. It also contributes to the growing space in parts of the northern society available for radical Islamic groups such as Boko Haram to take hold. Often shaped by their religious teachers in a period of Islamic religious revival, the crowds of unemployed and impoverished children, youths, and university graduates are increasingly ripe for recruitment by the likes of Boko Haram. In Nigeria, one often hears it said that it costs only1,000 naira per person (about six U.S. dollars) to put together a mob to burn down a church.
While Jonathan's electoral victory was internationally accepted as legitimate and has enhanced the country's status abroad (as demonstrated by his recent warm reception at the White House) the new Nigerian president faces enormous challenges. Presidential opponent Buhari is calling for a forensic investigation of the presidential elections that would examine allegations of vote buying, underage voting, intimidation, ballot box stuffing, and manipulation of polling numbers at collation centers. Buhari's party, the Congress for Progressive Change (CPC), has gone to court to challenge the poll results in 24 states and the Federal Capital Territory. Jonathan, for his part, has established a commission -- chaired by Ahmed Lemu, a distinguished retired grand cadi -- to investigate the violence in the North. But, otherwise, his outreach to the North has so far been disappointing. His closest advisors are fellow Ijaws, the country's fourth largest ethnic group mostly concentrated in the Niger Delta, and he has yet to include any influential figures from the North in his inner circle.