Our Report is to elicit questions, effect necessary corrections, says NEITI

 Everybody has heard about this concept, resource curse, where countries that are richly blessed with resources perform poorly in all development indicators when compared with others that are not so endowed. To the extent that if you plot a graph of countries that are richest in the world, whichever way you may look at it, in terms of wealth, literacy, productivity, or life expectancy, no matter how you define it, if you list the top 10 wealthiest countries in the world; and you list the 10 most resource endowed countries in the world, there is no correlation at all.

And then if, on the other hand, you list the 10 least developed countries, and 10 most endowed countries in the world, you will find out that most of them are in the same category.

So, a lot of scholars have written about this overtime and they call it all kinds of names like paradox of plenty; resource curse, etc. What they try to prove is that resources do not necessarily translate to benefits; and that is a real paradox because, ordinarily, if you have more resources, you should make it translate to better standard of living. It is something that people have written about; it is something that people have data to prove and people have also been asking themselves why is it so; is it because the resources are cursed or the way the resources are managed; and people have also established that countries that depend on natural resources are prone to boom and bust cycle.

During the boom season, they have a lot of money which sometimes also dislocate the structure of the economy in the sense that too much exposure to dollar inflow in the system devalues their own currency. Imports become so high that exports cannot compete. Also they become more or less a mono-cultural economy.

So they depend largely on one product and largely on import. And if you are looking for a country that typifies that, you don’t need to go too far. And people have also found out that because they are prone to that boom and bust cycle, when it is booming, a few people benefit and when it busts it is generalised; it affects everybody and it dislocates the economy entirely. And if you’re looking for a place where such happens, Nigeria, sadly, is a typical example. Some of these countries have also been found to be prone to corruption, prone to conflict because of the extractive nature and the rent-seeking culture that produces. If you are looking for anywhere to cite as an example, the present moment in the country typifies that.

 The mid-90s to early 2000 was a good time when the fear that Nigeria would experience what we are experiencing today was not there. It was good and by the time we transited to democracy in 1999, there was this supernatural benefits that came with democracy. Oil crossed 20 dollars, 25 dollars, 30 dollars, 40 dollars and it just kept going like that. At that point in time, there was a forward-looking government.

Some people started thinking of a day like this. Perhaps, to solve the problem of resource curse, they think about two possible ways. One is to have a stabilisation fund where you have some money put aside for the rainy day because when the rainy day comes, you can fall back on the fund to carry yourself over. We experienced that between 2008 and 2009 because of the global recession.

And because we had robust external reserves, we were able to survive. The other way is that it has been established that resources are not cursed; it is the way they are managed. If you manage them in a transparent and acceptable way, you are likely to get maximum benefits from them. That’s how we came into this. A lot of push was made globally that companies should publish what they pay to government and government should also publish what they receive, so that citizens should have that information and be able to hold their government accountable.

So, there’s this global movement that started it and in 2003 Nigeria signed up to it and 2004 it was fully instituted in Nigeria and began implementation.

We do three things- we publish audit reports of the sector that was legendary opaque; it was like a black box that nobody understood. So we publish reports. We look at three parts. We do the physical audit, look at the volume that people actually deal with; we look at the process that determines who gets what and how much they paid and we look at the financial audit.

 When NEITI started, all they requested countries to do was to do reconciliation of their financials but Nigeria said ‘no, take it a step further’, which also became the norm of NEITI. So, when we have the report we also disseminate the report so that people would have information that can help them ask questions and also enable us to do structural issues that we need to attend to.

We also identify the gaps. We identify different agencies that should be taking care of all those things; bring them to the table every quarter and ask  questions what should be done, what has been done, etc. So, we have been doing this since 2004.

We have even done beyond 2004, because President Obasanjo said, “why not go back to when I started so that people would know what has been happening?” So, the essence of the report is to ensure that things that were not done properly in the past will be corrected. And when people have information, they can now use such information to ask question on what is happening and advocate that things should be done differently.

So, within our beat, we have made a lot of progress. But there are still a lot more to be done. A ready indication that there’s still lot more to be done is the fact that if we had done all that should be done, Nigeria would not be where it is now. We started this 12 years ago, so the fact that people go through this, there will be improvement in the way things are done. We will continue to do what we do because we have the comparative advantage than any other person, group or institution to do this, because we have the resources provided for us to do the work and do it well. We also have a law backing what we do. That law enables us to ask people questions and make them provide information to us.

We generate enormous amount of data that we think should, at least, generate robust conversation about how things should be done differently and how our resources can be better managed.