• Monday, March 04, 2024
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The last mile syndrome (7)

Corruption still huge drawback in Nigeria despite reforms

It cannot be a surprise that Russia is planning to host “Africa Week” in St. Petersburg from 26th to 29th July 2023.

Once again the searchlight is being beamed on Africa, especially Nigeria and all our foibles as well as wasted opportunities.

The Russians should not be unduly worried if 94-year-old – Professor Thomas R. Kane shows up. He visited Lagos recently and survived considerable hardship – fuel shortage; cash shortage; chaotic traffic and insecurity.

Kane was born in Vienna, Austria. He immigrated to the United States with his parents in 1938 after Austria fell to Nazi Germany. In 1943, he enlisted in the United States Army and was stationed in the South Pacific as a combat photographer. From 1946 to 1953 he attended Columbia University during which he earned two BS degrees in mathematics and civil engineering, as well as an MS in civil engineering and a PhD in applied mechanics.

In 1953, Dr. Kane joined the engineering faculty at the University of Pennsylvania as an assistant professor of mechanical engineering and three years later was promoted to associate professor. While at Penn, he served as a research engineer and on the committee whose focus was investigating the question of sabbatical leave.

In the 1960s, Kane devised a method for formulating equations of motion for complex mechanical systems that requires less labour and leads to simpler equations than the classical approaches, while avoiding the vagueness of virtual quantities. The method is based on the use of partial angular velocities and partial velocities.

The Russians appear to be very much abreast of the thesis of Professor Paul Collier of Oxford University that the amounts stolen from Nigeria are a staggering £400 billiion

$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.”

The evidence available has been elevated beyond the circumstantial to the verdict of “Big Data” and Forensic Audit.

Front page headline “Daily Sun” newspaper January 24, 2023:

“How Nigerians connive with foreigners to sabotage the economy” – Adana Nnamani. He explained that illicit financial flows drain tens of billions of pounds out of Africa every year, which happens in several ways, including abusive transfer pricing, over invoicing, tax evasion, use of offshore financial banking centres, smuggling of cash and illicit goods and money laundering.

“The development of Nigeria is seriously threatened by illicit financial flows (IFF). Despite ongoing efforts by anti-graft agencies to contain the threat, IFFs and money laundering have remained hydra-headed monsters that have continued to deepen their grip on the country and torment it.

IFFs involve money laundering, bribery by international companies, tax evasion, falsification of business transactions and corruption, among others.

One of the major illicit financial outflows from the world is purportedly occurring from Nigeria, with Nigerian leaders being accused of sending money to financial centres like London. There have been questions regarding the willingness and domestic capacity to combat tax evasion, which is primarily committed by western multinational corporations. These worries are in addition to those regarding the agencies in charge of regulating the return of looted assets.

According to the Human and Environmental Development Agenda (HEDA) Resource Centre, the most alarming harm caused to Nigeria by illicit finance flow has been the harm done to its administration of the justice system.

It said that institutions within the administration of justice sector have underperformed and state institutions’ capacity to fight IFF and corruption has been seriously undermined.

Read also: The last mile syndrome (5)

According to Professor Bolaji Owasanoye, the chairman of the Independent Corrupt Practices and Other Related Offences Commission (ICPC), Nigeria accounts for 20 per cent, or $10 billion (N3.8 trillion), of the estimated $50 billion that Africa loses to illicit financial flows each year.

The IFF tragedy, according to the ICPC chairman, is that developing nations suffer the losses while wealthy industrialized nations of the West and, more lately, Asia and the Middle East, receive the funds.

Dr. Uche Igwe, a senior political economy analyst, said as Nigeria’s former colonial ruler, the United Kingdom has served as a haven for corrupt elite who steal billions of public funds and use them to finance expansive real estate holdings, opulent purchases or the education of their children in prestigious British private schools.

“Ibori and Dariye may be some of the unlucky ones who are perceived as thieves. Nevertheless, many richer Nigerian politicians continue to keep their dubious assets safely across the world, including Dubai, Beirut, Cape Town and other countries, (sic) apparently undetected,” he stated.

He explained that Illicit financial flows drain tens of billions of pounds out of Africa every year, which happens in several ways, including abusive transfer pricing, over invoicing, tax evasion, use of offshore financial banking centres, smuggling of cash and illicit goods and money laundering.

To curb this monster, Igwe noted that successfully tracking illicit financial flows is a multifaceted endeavour that requires political will both nationally and internationally.

“Illicit financial flows are multidimensional and transnational in character. They involve a complex network of interconnected players from banks, company directors and employees to such professionals as lawyers and auditors.

“Efforts must be made to reduce the bureaucracy involved in the repatriation of stolen funds through simplifying Mutual Legal Assistance Agreements between source and destination countries. The same political elite who allegedly engage in these practices cannot be relied on to push policies against it lest they become victims of their own efforts. Alternative complimentary mechanisms must then be sought.

“The ball remains in the court of developing countries like Nigeria to take the bold step of tracking and reclaiming illicit funds and utilising every available framework within the international system. There is a need to develop necessary tools and domestic capacity to challenge tax evasion perpetrated especially, but not exclusively, by multinational corporations. Stakeholders insist that monitoring mechanisms remain weak, maintaining that the Central Bank of Nigeria (CBN) has not done enough to stem the tide of money laundering by omitting policies that sufficiently deter looters,” he added.

Minister of Finance, Budget and National Planning, Zainab Ahmed, said Nigeria has implemented significant measures to curb illicit financial flow and ensure asset recovery.

Ahmed identified Nigeria as one of the nations most impacted by illicit financial flow when speaking at the international conference on illicit financial flows and asset recovery.

She said: “As one of the most affected countries, Nigeria has demonstrated strong commitment to addressing illicit financial flows through our participation in the open government partnership and the significant progress made in the extractive industry.”