Nigeria: Governance and assistance A political economy analysis Inge Amundsen, Chr. Michelsen Institute “Postmøtet”, CMI, Tuesday 25. January 2011

Observation –Optimism and pessimism in Nigeria Political Economy Analysis –History and economy –The ’Oil Curse’ –Niger Delta syndrome Norwegian involvement –Assistance and governance assistance –Statoil and other businesses –Recommendations Nigeria

Negative tendencies Deeply divided society ethic groups Muslim north, Christian/animist south Deep economic differences Military rule 30 of 50 years with dictatorships 66-79: Aguyi-Ironsi, Gowon, et al : Ibrahim Babangida 93-98: Sani Abacha Biafra war 67-70: one million dead Nigeria is deeply divided by regional, religious, ethnic, economic and political rifts. Besides, the military coups, the dictatorships, the chaotic civil administrations, corruption, and the constant pushing and pulling from oil and big money have weakened Nigerians’ sense of law, trust in each other, and trust in government.

Negative tendencies Elections 79-85: Shagari: “Dem-All-Crazy” 1999: Elections OK, Obasanjo 2003: Bad: Obasanjo 2007: Worse: Yar’Adua April 2011: any better? Godfathers, moneybags, violence, … Corruption Abacha embezzled 6 bn US$, TI top 5 TI: Nigeria at bottom (now 134/2.4) Political and bureaucratic corruption Money laundering, capital flight International organised crime Niger-Delta Syndrome The Resource Curse

Niger-Delta Syndrome Flaring, bunkering, abductions Densely populated Minority groups Ogoni people, Ken Saro-Wiwa 90% of oil production On-shore Pollution, gas flaring Violent conflict Environmental damage, flaring, pipelines Militarised Deportations, murder, destruction MEND, other ’liberation movements’ Banditry: abductions, bunkering

Resource curse ‘Paradox of Plenty’ Oil destroys the economy 400 bn US$: poorer than in 1960 Crowding out Oil destroys the political system Gives the incentives and the means Election manipulations Manipulation of institutions of control Oil destroys the social fabric Corruption, inequality Pollution Militarisation, conflict, violence

Positive tendencies? Political development? President Goodluck Jonathan Reformists? INEC commissioner Prof. Jega Elections in 2011: Ribadu? Institutions of control? EFCC ICPC Parliament and courts? Economic development? Economic growth Diversification? Growing middle class? Lagos Nuhu RibaduAttahira Jega President Goodluck Jonathan

Assistance to Nigeria Aid flows waning –2006: 11 bn US$ (debt relief) –2007: 2 bn US$ (election year) –2008: 1 bn US$ Biggest –IDA( World Bank, ’soft’ loans) –USAid (300 m/year, ’GG’) –DFID (150 m/year, 50 ’GG’) Good Governance –2006: 17 m US$ –2007: 5 m US$ –2008: 8 m US$ Norwegian aid –For ’Good Governance”: 383 m/year –To Nigeria: 1.5 m/year –For GG/Nigeria < 1 m/year

Norway in Nigeria Norwegian aid –To Nigeria: US$ 1.5 m/year Norwegian companies –Statoil Profits in Nigeria: US$ 800 m in 2009 –Oil industry service companies –Veritas –Fred Olsen Energy –Farstad Shipping –Trico Supply

Recommendations Short term –Elections i 2011 Independent National Electoral Commission (INEC) Electoral registration Parallel vote tabulation Violence prevention Civil society organisations –Project 2011 Swift Count –Domestic Election Observation Groups Long term –Use Norwegian advantages and skills Oil for Development, Petrad EITI, PWYP (in Oslo) UNDP Oslo Governance Centre, Revenue Watch, etc. –Monitor Norwegian companies ”Do no harm”, EITI principles, CSR –Strengthen petroleum sector regulators NEITI Publish What You Pay (Nigeria) EFCC Courts? Media? CSOs?

The Report Research team: –Main researcher: Inge Amundsen –Nigerian partner: Prof. Adele Jinadu –CMI resource person: Tina Søreide –Reviewer: Arne Tostensen Norad ’reference group’ –Norad staff (FLID/ANKOR/SAMØK/OFU) –Embassy in Abuja Fieldwork Published as –Norad Report 17/2010 –Presentation seminar Oslo ”Rapporten er, og vil bli et nyttig referansedokument for ambassadens videre arbeid med innretting av fremtidig bistandsportefølje”