In 1957 the Western and the Eastern regions became formally self-governing under the parliamentary system. Similar status was acquired by the Northern Region two years later. There were numerous differences of detail among the regional systems, but all adhered to parliamentary forms and were equally autonomous in relation to the federal government at Lagos. The federal government retained specified powers, including responsibility for banking, currency, external affairs, defense, shipping and navigation, and communications, but real political power was centered in the regions. Significantly, the regional governments controlled public expenditures derived from revenues raised within each region.
Ethnic cleavages intensified in the 1950s. Political activists in the southern areas spoke of self-government in terms of educational opportunities and economic development. Because of the spread of mission schools and wealth derived from export crops, the southern parties were committed to policies that would benefit the south of the country. In the north, the emirs intended to maintain firm control on economic and political change.
Any activity in the north that might include participation by the federal government (and consequently by southern civil servants) was regarded as a challenge to the primacy of the emirates. Broadening political participation and expanding educational opportunities and other social services also were viewed as threats to the status quo. An extensive immigrant population of southerners, especially Igbo, already were living in the north; they dominated clerical positions and were active in many trades.
The cleavage between the Yoruba and the Igbo was accentuated by their competition for control of the political machinery. The receding British presence enabled local officials and politicians to gain access to patronage over government jobs, funds for local development, market permits, trade licenses, government contracts, and even scholarships for higher education. In an economy with many qualified applicants for every post, great resentment was generated by any favoritism that authorities showed to members of their own ethnic group.
In the immediate post-World War II period, Nigeria benefited from a favourable trade balance. Although per capita income in the country as a whole remained low by international standards, rising incomes among salaried personnel and burgeoning urbanization expanded consumer demand for imported goods.
In the meantime, public sector spending increased even more dramatically than export earnings. It was supported not only by the income from huge agricultural surpluses but also by a new range of direct and indirect taxes imposed during the 1950s. The transfer of responsibility for budgetary management from the central to the regional governments in 1954 accelerated the pace of public spending on services and on development projects. Total revenues of central and regional governments nearly doubled in relation to the gross domestic product (GDP—see Glossary) during the decade.
The most dramatic event having a long-term effect on Nigeria’s economic development, was the discovery and exploitation of petroleum deposits. The search for oil, begun in 1908 and abandoned a few years later, was revived in 1937 by Shell and British Petroleum. Exploration was intensified in 1946, but the first commercial discovery did not occur until 1956, at Olobiri in the Niger Delta. In 1958 exportation of Nigerian oil was initiated at facilities constructed at Port Harcourt. Oil income was still marginal, but the prospects for continued economic expansion appeared bright and accentuated political rivalries on the eve of independence.
The election of the House of Representatives after the adoption of the 1954 constitution gave the NPC a total of seventy-nine seats, all from the Northern Region. Among the other major parties, the NCNC took fifty-six seats, winning a majority in both the Eastern and the Western regions, while the Action Group captured only twenty-seven seats. The NPC was called on to form a government, but the NCNC received six of the ten ministerial posts. Three of these posts were assigned to representatives from each region, and one was reserved for a delegate from the Northern Cameroons.
As a further step toward independence, the governor’s Executive Council was merged with the Council of Ministers in 1957 to form the all-Nigerian Federal Executive Council. The NPC federal parliamentary leader, Balewa, was appointed prime minister. Balewa formed a coalition government that included the Action Group as well as the NCNC to prepare the country for the final British withdrawal. His government guided the country for the next three years, operating with almost complete autonomy in internal affairs.
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