• Thursday, February 22, 2024
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The last mile syndrome (5)

The last mile syndrome (5)

When the highly respected Professor Paul Collier who is an Economist at Oxford University dropped a bombshell to the effect that as much as £400,000 billion of funds belonging to Nigeria had been fraudulently squirreled away in foreign banks as well as the diaspora most of those at the “Africa Week” at Oxford University were somewhat sceptical.

Corroboration has been provided:

$400 billion looted in 39 years: UN official speaks on negative impact of Nigeria’s corruption

Within 39 years,(1960-1999) Nigeria lost over $400 billion to a rash of corrupt leaders. And it has lost even more in the last 16 years, with the Jonathan administration taking the gold medal, according to General Ibrahim Babangida, a former military leader, who himself used to be described as the man who institutionalised corruption in Nigeria. He now says his regime was saintly judging by news reports of the looting of the treasury in recent years,

Here is the view of a UN official, Antonio Maria Costa, executive director of United Nations Office on Drugs and Crime, UNODC, on the implications of the huge resources being plundered by successive administrations. He said it in November 2007.

“Nigeria used to be synonymous with corruption just a few years ago. Unscrupulous leaders pilfered the national coffers and stashed away billions of dollars in foreign bank accounts. By some estimates close to US $400 billion was stolen between 1960 and 1999. Sani Abacha alone is estimated to have stolen the equivalent of 2 – 3 per cent of the country’s GDP for every year that he was President.

“That is a staggering – almost “astronomical” – amount of money because if you were to put 400 billion dollar bills end-to-end, you could make 75 round trips to the moon! Concretely, those 400 billion dollars could have translated into millions of vaccinations for children; thousands of kilometres of roads; hundreds of schools, hospitals and water treatment facilities that never came to be.”

Perhaps we should set the records straight. This is what the erudite Professor Collier actually said according to Michael Watts:

“Old development, and the politics of the bottom billion”

“The Economist of 4 August 2007 called it a “slip of a book” and “set to become a classic.” Paul Collier’s The Bottom Billion argues that most of the bottom billion, the world’s chronically poor, live in 58 countries (almost three quarters of which are African) distinguished by their lack of economic growth and the prevalence of civil conflict. Most are caught in a quartet of “traps,” two of which (in Collier’s account they are deeply related) concern me here: the civil war trap (the average cost of a typical civil war is about $64 billion) in which 73% of the poor have been caught at one time or another; and a natural-resource trap (resource wealth or dependency turned sour), which accounts for another 30%. Collier’s argument is not simply that civil conflict is expensive in human and developmental terms nor that wars are associated with economic stagnation and poverty (“low income means poverty, and low growth means hopelessness. Young men, who are recruits for rebel armies, come pretty cheap…. Life itself is cheap”).

Rather, he sees this nexus of forces as arising from resource dependency (“Dependence upon primary commodity exports… substantially increases the risk of civil war”). That is to say, there is a robust relationship between resource wealth and, paradoxically, poor economic performance, poor governance (resource predation), and the likelihood of falling into (debilitating and enduring) civil conflicts.

Collier’s book speaks to a wider interest taken by economists and political scientists in what seems like a challenge to economic orthodoxy, namely, that resource wealth (as a source of comparative advantage) turns out to be a “curse.”

The “resource-curse” literature—whether emphasizing poor economic performance, state failure (oil breeds corruption or “resource rents make democracy malfunction”), or the onset of civil violence (blood diamonds, oil secession)—has generated a vast amount of research of which Collier and his colleagues have been central contributors.

Perhaps not surprisingly, Nigeria figures centrally in Collier’s book. An oil state gone awfully wrong, a black hole for foreign aid ($280 billion in 30 years with “depressingly little to show for it”), endemic (perhaps Olympian) corruption and rent seeking, mass miscomprehension or false consciousness (the popular Nigerian belief that the poverty of the 1980s was a function of structural adjustment rather than the massive mismanagement of the oil boom-bust cycle), and a litany of military governments interspersed with periods of civilian rule which confirm his claim that “resource-rich democracies” and an abundance of oil rents alters how electoral competition is conducted (“it lets in the politics of patronage”). Big Oil engenders Big Patronage (“the law of the political jungle: the survival of the fattest”).

Oil wealth relaxes political constraints, most obviously by obviating the need to tax. The sort of democracy that resource-rich states engender is “dysfunctional for economic development,” especially if they are low income and ethnically diverse. To round out the story, the combustible mix of the law of the survival of the fattest under the dispensation of oil provides ideal grounds for resource predation and the illicit economy of rebellion (the economic basis of civil war).

Nigeria and its oil-producing Niger Delta is a textbook case of why rebellions have much less to do with what rebel leaders say about their political project (liberation, justice, equity) and much more to do with organized crime and the readiness with which the resource upon which the fattest depend can be looted.”

The Vice-President of Nigeria, Professor Yemi Osinbajo (who is a Professor of Law) has provided us with solid evidence – far beyond reasonable doubt or mere hearsay:

“A few weeks to elections, the sum of US$ 292 million in cash was taken out of the Nigerian treasury. For two weeks after that, the Central Bank of Nigeria did not have cash dollars. Let us take a 100 million dollars today that will be about N36 billion. The trader money programme that we are doing when we are giving loans to 2 million petty traders is just 20 billion that is one withdrawn from the treasury of Nigeria.

Another day, N60 billion withdrawn, 3 Nigerians did what is called strategic allowance contract, what was taken away and never returned, and still pursuing them all over the world was almost 3 billion dollars. How much is 3 billion dollars, our entire external reserve is 40 billion dollar today.

When we started it was 28 billion dollars. If somebody makes away with 3 billion dollars how do you then not expect that people will be bored, how do you not expect that we will not have enough to fund education, to fund infrastructure, to fund healthcare.

You know sometimes I get so emotional about this issue of corruption and so irritated that the same individuals who rob this nation can come back and tell us that oh we are the people who can fix it. I think we are dealing with an outrage.”

Additional proof has been provided on the front page of “Sunday Vanguard” newspaper of January 22, 2023.

Headline: “14 ex-governors fingered in N21 trillion, $47.4 billion fraud in 15 years.”

· 61 of 100 cases ongoing one and a half decades after

· Money almost equals Federal Government’s 2023 budget of N21.83 trillion, Ways and Means debt of N22.7 trillion

· 8 Former Ministers/Special Advisers, 5 Senators, others make list

· Money credited to women suspects: N8.9 trillion, $20 billion Men- N7.9 trillion, $17.8 billion

· Trials of those charged should be pursued with vigour and efficiency – Justice Richard Goldstone, a former Justice of Constitutional Court of South Africa.

(ii) Front page of “Sunday Punch” newspaper of January 22, 2023.

“Mr. Abubakar Malami, Minister of Justice and Attorney-General of the Federation in response to a Freedom of Information request by SERAP (Socio-Economic Rights and Accountancy Project) confessed that the Nigerian Government had no records of the exact amount of public funds stolen by a former military Head of State, General Sani Abacha, and no records of the spending of about $5 billion recovered loot for the period between 1999 and 2015.”

The federal government has told the Socio-Economic Rights and Accountability Project (SERAP) that it “has no records of the exact amount of public funds stolen by a former military head of state, Sani Abacha and no records of the spending of about $5 billion recovered loot for the period between 1999 and 2015.”

The government’s response followed SERAP’s Freedom of Information (FoI) requests sent to Abukabar Malami, Attorney General of the Federation and Minister of Justice and Zainab Ahmed, Minister of Finance, Budget and National Planning, requesting: “information on the exact amount of public funds stolen by Abacha, and details of spending of about $5 billion recovered loot since the return of democracy in 1999.”

According to SERAP, only Mr Malami has sent a reply to its FoI requests. In the reply dated February 26 but which SERAP said it received March 9, Mr Malami said: “We have searched our records and the information on the exact amount of public funds stolen by Abacha and how recovered loot was spent from 1999–2015 is not held by the Ministry.”

Mr. Malami also said: “However, a total of $322 million was recovered from Switzerland in January 2018 and the funds were used for Social Investment Project. Also, $308 million was recovered from the Island of Jersey in collaboration with the USA. While awaiting the transfer of the money to Nigeria, it has been designated for the following projects: Lagos—Ibadan Expressway; Abuja—Kano Expressway, and Second Niger Bridge.”

Dissatisfied with Mr Malami’s reply, SERAP deputy director Kolawole Oluwadare said: “The failure to provide information on the exact amount stolen by Abacha and on spending of recovered loot for the period between 1999 and 2015 implicitly amounts to a refusal by the government. The government also failed to provide sufficient details on the spending and planned spending of the $630 million it said it recovered since 2018.”

In the statement dated March 15, SERAP said: “in the circumstances and given that Mrs Zainab Ahmed (Minister of Finance has failed and/or refused to respond to our FoI request, we are finalising the papers for legal actions under the FoI Act to compel the government of President Muhammadu Buhari to fully and effectively comply with our requests.”

Mr Malami’s reply with reference number MJ/FOI/REQ/035/11/34, was signed on his behalf by Hamza Omolara, Principal Counsel at the Ministry of Justice.

It would be recalled that SERAP’s FoI requests expressed: “concerns that substantial part of the estimated $5 billion returned Abacha loot since 1999 may have been diverted, re-stolen or mismanaged, and in any case remain unaccounted for.”

The FoI requests dated February 14, read in part: “the Federal Government should disclose details of projects executed with the Abacha loot and their locations, details of companies and contractors involved in the execution of any such projects, details of all the agreements on the loot, the roles played by the World Bank and other actors, as well as the implementation status of all projects since 1999.

Publishing the details of projects on which Abacha loot has been spent would allow the public to know the specific projects carried and the areas of the country in which the projects have been implemented as well as the officials that may be responsible for any alleged diversion or mismanagement of the loot.”

More damning evidence has been provided on the front page of “Vanguard” newspaper on January 6, 2023.

Headline: “NDDC, shame of a nation” – Onochie, new Chairman

“Chairman of Governing Board of Niger Delta Development Commission, NDDC, Lauretta Onochie, has described the commission as a shame of the country her newly appointed board was determined to turn around.

Onochie, leading the board, yesterday, to take over the commission’s management at the headquarters in Port Harcourt, Rivers State, said there was little or nothing to show for NDDC in the region since inception 23 years ago.

She said; “This (NDDC) is an organisation commissioned, specifically for the people of Niger Delta. It is an interventionist agency that is supposed to bring about prosperity, it is supposed to bring development in our region.

This organisation was set up in 2000. If you go round the Niger Delta till date, there is little or nothing to show for it. NDDC has been a shame of the Niger Delta and a shame of our nation.”

Also, on January 6, 2023, “The Punch” newspaper carried on its front page with blazing headlines:

(i) “28 governors pile up n5.8 trillion debts for incoming governors”

– “states debts to rise above 200 per cent of revenue in 2023” world bank

– “Lagos cannot execute laudable projects without loans” – Commissioner

On its front page, “The Nation” newspaper in January 16, 2023 divulged one of our nation’s most guarded secrets.

Headline: “Auditor-general fails to publish 2020 – report”

Read also: The last mile syndrome (4)

In order to fill the vacuum, Steve Martin (1945) delivered an auditors’ report with a different twist: “In the beginning, God made Nigeria a place to live in. In the end, her leaders turned her into a hell of a place to live in.”

In a subtle endeavour to validate the postulation of Professor Paul Collier, ThisDay carried on its front page on January 24, 2023, the following report:

“Nigeria tells London court to overturn $11 billion damages bill to P & I D”

“Nigeria yesterday told a London High Court that the country was the victim of “a campaign of bribery and deception” over a collapsed gas processing project.

The country’s lawyer had earlier appealed against an $11 billion damages bill for which the case is now underway.

A London arbitration tribunal in 2017 awarded $6.6 billion in damages to Process & Industrial Developments (P&ID), a little-known British Virgin Islands-based company, for lost profits related to the failed project.

The interest has now swelled to just over $11 billion, or around 30 per cent of Nigeria’s foreign exchange reserves, Reuters reported.

Nigeria alleged that the 20-year contract awarded to P&ID in 2010 was procured by bribes paid to senior officials at its Ministry of Petroleum Resources.

It also alleged that, when P&ID took Nigeria to arbitration for breaching the contract, P&ID bribed Nigeria’s legal representatives, who then did not properly defend the case.

P&ID had, in written submissions to the court, denied it paid bribes to procure the contract or that it colluded with Nigeria’s legal team during the arbitration, arguing that Nigeria breached the contract and it is entitled to enforce the tribunal’s award.

At the start of an eight-week trial, Mark Howard, representing Nigeria, told London’s High Court that P&ID obtained its contract “by telling repeated lies and paying bribes to officials”, and then “corrupted” Nigeria’s lawyers to obtain confidential documents during the arbitration.

Howard added in court documents that P&ID paid bribes and relied on false evidence “to dupe (Nigeria), the tribunal and this court into giving P&ID an extraordinary amount of money on the back of a campaign of bribery, corruption and deception”.

P&ID, however, argued that the gas processing agreement was “a genuine contract which P&ID genuinely wanted to perform”.

Its lawyer, David Wolfson, said in court documents that Nigeria’s loss in the arbitration “had nothing to do with any corruption”.

Wolfson will make opening arguments on behalf of P&ID on Tuesday.”

One of the vignettes shared at “Africa Week” in Oxford was: “The secret of great wealth with no obvious source is some forgotten crime, forgotten because it was done neatly.” – Honore de Balzac (1799 to 1850).