Political corruption and the rise of the oligarchs (2)

The 1975 – 1979 regime introduced the first money laundering decrees – to catch Nigerians and resident foreigners with foreign accounts.  Yet, the same Government was seizing companies and properties of foreigners and Nigerians and resellng them to other. Nigerians through the Indigenization Decrees, abandoned property scheme etc.

-But in almost all these attempts to curb corruption, all fell far short of perceived grievances and brought untold hardships to Nigerians and foreigners resident in Nigeria without substantially effecting corruption or its practitioners.  If anything, it sucked various leaders of the Government into its vortex and 1979 could not come soon enough for the military to step down.  

-There was, however, on the part of Government a clear intention that those who had been probed, found guilty etc even if they did not go to jail, were to be denied access to political office; hence  the Government resorted to wholesale banning of many people from holding office for 10years, others for life.

-The 1979 election saw the sanitization of the political class – at least the older and well known ones who may have been tainted with corruption through refusal of the Government to allow them to contest elections. The Government used the State Security Service apparatus to deny clearance to many the Government thought were unsavoury through corruption.

But you can’t keep a good man down, or better still, you can’t keep a corrupt politician down!!

Between 1975 –1979 Government had a Policy of one man one house/plot – this merely made people to find more ingenious ways to acquire property.  In any case, it was not long before nearly all the seized properties were returned to their owners – thus again, bellying the notion that corruption does not pay!!.

The civilian Administration between 1979- 1983 was believed to be more corrupt than any before it?  At least it was so in perception, though difficult to prove in reality.  Excesses such as personalized champagne both at weddings and parties, junkets to the capitals of the world by politicians, a bravado of heedless spending, cemented a belief in culture of corruption. 

The NPN Government was committed to several large projects – iron and steel plants, currency and trade liberalization, shipping, roads etc.  This was true for the Federal Government and the then 19 other state Governments who had made electoral promises.  Moreover, price controls which was introduced by the previous Government continued; inflation was raging, price of imported food stuffs had to be brought down through the National Supply Company, controls of imports instituted by a regime of licenses and further control by Central Bank and Ministry of Finance through the mechanism of Forms A, and Form M etc.  

Each bottleneck imposed by Government became a Central point for corruption which was worsened by the granting of import waivers to favoured people.

The economy was booming; members of Government garnered for themselves licences, waivers etc – put crudely, they had licences to print money.

Anyone who was looking for justification for corruption can easily find it in a civilian administration.  And the military was doing just that, itching to return to Government.  The Military struck in 1983, – after a successful election and perhaps a determination of the civilian Government of Alhaji Shehu Shagari to fight corruption.

That return of Military Government lasted from 1983 to 1999.  It produced and “cemented” a new phenomenon in Nigerian corruption and wealth concentration in a few hands and the beginning of a powerful oligarchy of military and civilian “aristocrats”.(the juxtaposition of “aristocracy” and “oligarchy” is deliberate because that was what happened in Nigeria). 

Individuals started chopping off state property, or consolidating companies for monopolies – an entirely new way of wealth accumulation.  Our leaders were building up family fortunes, a cursory look at the names of the generals and their friends would confirm this and their grip the economy.  Something called “Nigeria Incorporated” could be indentified with all those who had held political power.  It was the consolidation of incredible wealth and power in a way never before seen in Nigeria.

The advent of civilian political administration in 1999 up till to-day merely consolidated more wealth in fewer groups of individuals owning telecommunication gateways or switching exchanges, oil block concessions, banking and insurance companies of considerable size, International brands in Hotels, event centres, shopping malls and franchises; – a process not unlike Russia after the collapse of the Soviet Union, when Yelsin in some drunken stupor auctioned off large state enterprises and companies to few individuals who mostly worked for the Russian KGB, GRU and many other state secret services.

Our political elites – senators, the legislators, Governors etc  have continued this consolidation apace – they own even more finance houses, aeroplanes, sea port  and airport concessions etc.  The suborning of Government and State property for private use has never been greater and there seems to be no end in sight.  The example thus set will only spur later politicians to do the same- unless a rigorous code of conduct is imposed immediately. Every Minister or State Government or legislator sees Government property and processes as legitimate areas for plunder in order to bolster up this oligarchic credentials.

It does not take too much imagination to see that such a system is both inevitable and unsupportable.  But when did such consideration stop political and ravenous appetites of the oligarchs? 

Here are some simple examples of how to set up an oligarchy. A Minister arrives as Minister of Transport or Aviation or of Federal Capital; or of Works.  The transport ministry has railways, ports, waterways, canals, road etc under it.  A great deal of land and property belong to the Ministry.  The Minister systematically begins to suborn property belonging to Nigerian Railways, Ports Authority, water ways etc for himself and appointed companies, only yielding to other powerful politicians or military officers who are similarly compensated.  The result is the transfer of these properties to companies he and his friends or family have formed;- makes sure that every single thing to be supplied to these entities – uniforms, steel, diesel, cars, etc goes through companies belonging to him and his associates and his friends, if some of the entities are to be privatized or concessioned, they are gobbled up by the oligarch minister and his cohorts who continue in a frenetic ceaseless quest to bring more properties and entities under them.

The bankers had set up the template for oligarchy.  The Managing Director of the bank would lend money to buy a piece of land for a company he owns.  That company would borrow money from the bank to develop a property.  The bank now leases the property for 10years, paid up front for the rent which is well over what the company had borrowed for the land and construction.  This is replicated over and over again as each branch is set up; thus some banks have over 300 branches.!!

The wife of the Managing Director is responsible for catering for all the staff; she has an agency for travel, entertainment etc – all feeding off this bank.  Shares are paid for on loans from the bank.  Some other banks merely declare new shares they divide among themselves.  The system works just as well for the Minister.  He may decide to recruit staff.  

The contract for this is offered to the wife of another Minister or strong politician.  Event centres are hired and thousands of Nigerians paying X naira apply.  Money is made at all levels and each level is a clog in the oligarchy.  Same would apply in say, Aviation where large land areas belong to the Ministry; concessions galore exist; only the imagination can stop what is possible when an oligarchic mind set is at play.  In agriculture industries, trade, finance, communications etc – these can be substantial play grounds for the oligarchs.  

Presidents and Governors, Military Officers, Police Officers, Custom Officers, former Ministers of Defence, Federal Capital Authority – have all built up institutions that would forever shore up their families: they have promoted other individuals who own IT, companies, banks, cement factories, petrochemical factories, oil companies, food processing plants and factories etc.  It is probably safe to say that all the billioniares we have in Nigeria to-day have at one point or the other enjoyed Government patronage by way of massive and continuous import waivers, long tax holidays, port concessions, fertilizer and petrochemical companies, import monopoly of key ingredients of the state etc.

I have heard justification for this from highly placed persons (Presidents Governors etc) who argue that all Nigeria needed to succeed economically, was the strategic placing of ten Nigerians in key industries and businesses and the support by Government of these ten people: if you look around and you will find them.  So, I would not bother with their names I hope someone would devise a new type of monopoly game called spot the Oligarchs.  I am sure social media would be able to name these oligarchs.  Some Governors have interest in oil, petrochemicals, hotels, massive land holdings, major interest in tax collection companies etc.  Whenever political parties meet – these are the Godfathers of the political parties who resolutely refuse to have internal democracy within the parties because, it pays these money bags to finance the parties and choose all the candidates for political office.

Both Messrs Presidents and State Governors have created oligarchs.  These creations by the Presidents include Ministers who have attempted to build international hotels at the airports – none has yet materialized.  Others have bought international Hotels in Abuja.  Two bankers, one stocks dealer, belong to a transactional company its directors are part of the usual suspects and they are in everything- fruit drinks , cereals, spaghetti and other food productions, cement etc, another is in data management yet another in GSM, one is the owner of the ill fated Air Nigeria and the following debacle.  Other oligarchs have found other pastures in tank farms, insurance, hotels, publications and so on. Others have benefited from monopoly industries like production of saline solutions for hospitals, manufacturing of injections and other medical equipment.  More oligarchs have exploited the Soa Tome oil concession, have benefited from oil transactions in Nigeria from the oil majors, other have real estate companies outside Nigeria from proceeds of money made in Nigeria; a new group is seeking access to the power plants.  They are all major clogs in the overall oligarchic system.  Hundreds of Nigerians are now operating in Dubai, China, South Africa, the US who were anointed oligarchs or these anointed by political Godfathers here – carrying millions of dollars to their chosen location.  And yet all of this is but, scratching the surface.  Beneath this is an army of young men and women who prop up the system.    

A new class of oligarchs have just appeared on the surface.  For years NNPC had followed rules which made it extremely difficult for Nigerians to lift crude even when they had both the expertise and like Dr. Eddie Opia, owned tankers.

The announcement last week that Nigerian companies would be allowed to lift crude show the present Administration’s stride towards growing its own oligarchs.  The favoured companies include Tridax Energy (incorporated in Switzerland in 2010 and started lifting 2011; Tridax OIL AND Gas incorporated in Abuja).  Tridax Properties, Mezcor and Linear, AITEO, TALEVERAS ATLANTIC ENERGY who own an operational contract for some of Nigeria Petroleum Exploration Developing Company.  Sahara Energy company etc.  The largest of these has just signed an oil concessions; some shaddier ones have been lined up as proxies for powerful interest for oil concessions being sold by some International oil Companies – the common thread in all these transaction is that they are all nearly opaque.  

 Patrick Dele Cole