Nigeria

March 2005 | Risk Summary

Tensions between the government and international oil companies (IOCs) have risen as Lagos proposes to up its tax on oil profits to 85% from the current level of 50%. Several key oil companies have threatened to withhold investment if the plan is enforced. Persistently high oil prices have permitted IOCs to bear the costs of bureaucracy, corruption and rising political unrest over the past year, but the government may need to compromise on its tax plans, especially if oil prices fall. Relations between the government and oil firms could deteriorate badly in the event of an oil price decline, as

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