Examine the impact of global trading patterns on one developing economy you have studied. - Leaving Cert Geography - Question 88 - 2020

Global trading patterns have significantly impacted Nigeria's economy.

1. Increased Foreign Investment: Global trade has attracted foreign direct investment (FDI) into Nigeria, particularly in the oil and gas sector. This investment has contributed to the country's GDP growth and has created job opportunities.

2. Dependency on Oil Exports: Nigeria's economy heavily relies on oil exports, making it vulnerable to fluctuations in global oil prices. When prices drop, Nigeria faces economic challenges, such as budget deficits and reduced public services.

3. Trade Imbalances: Nigeria experiences trade imbalances due to its reliance on imports for essential goods, including food, machinery, and consumer products. This reliance can lead to a depletion of foreign reserves and affect the country's currency stability.

4. Export Diversification Efforts: To mitigate the impact of global trading patterns, the Nigerian government has initiated policies aimed at diversifying its exports beyond oil. This includes promoting agricultural exports and developing other industries, which could lead to a more stable economy.

5. Impact on Local Industries: Global trading patterns can also affect local industries. For instance, the influx of cheaper imported goods can undermine local manufacturers, leading to business closures and job losses.

6. Integration into Global Markets: Nigeria’s participation in international trade agreements and organizations has facilitated its integration into global markets. This integration provides opportunities for technology transfer and knowledge exchange, benefiting various sectors of the economy.

As Nigeria navigates these complexities, understanding the diverse impacts of global trading patterns is essential for crafting effective economic policies.