Before the colonial period, the area which comprises modern Nigeria had an eventful history. More than 2,000 years ago, the Nok culture in the present Plateau state worked iron and produced sophisticated terra cotta sculpture. In the northern cities of Kano and Katsina, recorded history dates back to approximately 1000 AD. In the centuries that followed, these Hausa kingdoms and the Bomu empire near Lake Chad prospered as important terminals of north-south trade between North African Berbers and forest people who exchanged ivory, and kola nuts for salt, glass beads, coral, cloth, weapons, brass rods, and cowrie shells used as currency. In the southwest, the Yoruba kingdom of Oyo was founded about 1400, and at its height from the 17th to 19th centuries attained a high level of political organization and extended as far as modern Togo. In the south central part of present-day Nigeria, as early as the 15th and 16th centuries, the kingdom of Benin had developed an efficient army; an elaborate ceremonial court; and artisans whose works in ivory, wood, bronze, and brass are prized throughout the world today. In the early 19th century the Fulani leader, Usman dan Fodio, launched an Islamic crusade that brought most of the Hausa states and other areas in the north under the loose control of an empire centered in Sokoto.²⁶

Since independence, the economy has become increasingly under the influence of the oil industry which has moved the country away from its agricultural base. However, oil has affected the way in which successive military regimes have approached economic management as well as investment and consumption patterns.²⁷ The capital-intensive oil sector provides 20% of GDP, 95% of foreign exchange earnings, and about 65% of budgetary revenues. The largely subsistence agricultural sector has failed to keep up with rapid population growth - Nigeria is Africa's most populous country - and the country, once a large net exporter of food, now must import food. The IMF have proposed a number of market-oriented reforms, such as modernization of the banking system, the curbing of inflation by blocking excessive wage demands, and the resolution of regional disputes over the distribution of earnings from the oil industry. During 2003, the government deregulated fuel prices and announced the privatization of the country's four oil refineries. GDP growth will probably rise marginally in the future, led by oil and natural gas exports. The country faces the daunting task of rebuilding a petroleum-based economy and institutionalizing democracy if it is to build a sound foundation for economic growth and political stability.²⁸

There has been a long-term, halting diffusion of the liberal democratic state. Key contextual factors of transition include: international pressure for democratization, geo-political dynamics of pro-democracy coalitions, and local and trans-local political economic relationships. Nigeria, under the military governments of Babangida and Abacha (1985–1998) was in a perpetual half-hearted state of transition to democracy. The country's status as a major oil exporter allowed it relative immunity from international pressure for democratization. Mobilization for state creation served to divide opposition to military government because it focused attention at the local scale, as new state movements competed for access to centrally controlled resources and political recognition of their ethno-regional group(s).²⁹ In 1999, following 15 years of military rule, a new constitution was adopted and a peaceful transition to civilian government was eventually completed; the first civilian transfer of power in Nigeria's history.

GDP per capita is Intl $ 915. This falls within the range of $8,272 ( Libya) and $346
(Democratic Republic of the Congo) in the countries of Africa (Table 5).

Table 5 GDP per capita (Intl $): countries of Africa, 2001

Source: WHO