Debt forgiveness for Nigeria, bad example

*Fool of US taxpayers, mockery of Nigerian common man

- By Oguchi Nkwocha, MD

(Saturday, June 25, 2005)


"Stashed away in the banks of the lender-nations is approximately $170B of looted cash--money stolen from the coffers of Nigeria. The lender-nations were nice enough to do the research and document accounts, numbers, owners, banks, etc. The list was recently handed over to General Obasanjo for action: he has not done anything with it."


Debt cancellation, debt forgiveness, debt relief, or whatever term, as far as Nigeria is concerned, is a waste of money for the loaners, and a reward to the few individual Nigerians and their collaborators who stole the money in the first place. It is an insult to the intelligence of the American tax payers, and a mockery of the hapless peoples of Nigeria on whom the "relief" is falsely justified. There is blackmail going on here; there is political gaming, there is hypocrisy and there is treachery: none of that favors the common Nigerian. There are clean, honest, straight-forward "morally correct" ways to settle the debt in full and not shackle the hapless Nigerians further. Whatever the outcome, one thing is certain: those impoverished Nigerians whom it is argued would benefit from debt relief will derive not a single benefit from the exercise.

Here's a true story to set the stage. In one evening's showy event last month, Nigerian leaders and wealthy establishment raised 7 billion Naira ($1 = 125 Naira). That's well over $55 Million. What was the event? The fundraising for General Obasanjo's private and personal "presidential library." President Obasanjo, in his grandiosity, wants a presidential library in the manner and style of the US Presidents. Never mind that no university or other institution of higher learning in Nigeria has a functional library. Never mind that just the idea itself of a Public Library is a public ridicule. So, on that evening, wealthy organizations and individuals coughed up $55 Million for this "White Elephant project." The State governors contributed a total of 360 Million Naira (approx $3 Million) (where did the money come from?) One highly placed government official donated his next paycheck. The donors had one thing in common: many are connected to the "sharing" of Nigeria's wealth--they have been beneficiaries of the looting of Nigeria's coffers in the past and present; others were going on record to be included in the "next dividend." General Obasanjo, trotting around the globe begging for debt relief for Nigeria, could see nothing wrong with this ostentatious display and totally meaningless project. None of his foreign hosts pointed this out to him, as far as the public can tell. Think for a moment: if those who have the money in Nigeria can raise $55 Million in just one cool evening for the President of Nigeria's so-called private project, why does anyone think that Nigeria needs debt forgiveness, and for whom is the benefit?

First, no common or average Nigerian benefited from the original loans. The money was stolen by Nigerian leaders. Those leaders are still around, manning the affairs of state. The current President of Nigeria, General Obasanjo, is one of the beneficiaries of that fraud, but you wouldn't know it today, to see him running around in his hypocritical crusade for debt forgiveness for Africa. It is nauseating to watch the lender-nations praise him. Perhaps, in a way, it all fits.

Second, even if the debt is forgiven, there will not be the slightest change in the lot of Nigerians today as a result of that; in fact, if any thing, the change will remain the usual wont of Nigerians--a huge "negative delta," because the conditions tagged on to the "forgiveness action" will ultimately and unabashedly hurt the people, not Nigeria's corrupt leaders. This would only add to ongoing woes of the people, woes which are totally unrelated to the debt quagmire. $38B is a lot of money by Nigerian standards, but it nevertheless represents only a tiny fraction of Nigeria's total earnings from just Oil. What can $38B do for the common Nigeria which could not be accomplished by the relatively huge earnings of Nigeria all this while?

But, consider this:

Stashed away in the banks of the lender-nations is approximately $170B of looted cash--money stolen from the coffers of Nigeria. The lender-nations were nice enough to do the research and document accounts, numbers, owners, banks, etc. The list was recently handed over to General Obasanjo for action: he has not done anything with it. The General has also refused to reveal the list to the Nigerian media or to the Nigerian people. (You can imagine why! ) Now supposing Nigeria asked the lender-nations to recover what's owed the latter from this loot in the latter's banks--and even subtract the recovery fees, but return the "change" to Nigeria. That's easy enough, and quite doable. It's called, "collection." Such a solution would not have failed to come to the attention of the principals in this matter. However, if the debt repayment matter is solved in this manner, the debt is settled for good, forever; and in a budget-neutral or even "positive balance" mechanism in the favor of the erstwhile debtor-country. But, and that's a "huge But," this means that the lender-nations have lost their leash on Nigeria. These loans were originally designed and configured in such a way as not to be fully paid off anytime. These loans provide a lot of leverage for the lender over the debtor; the monetized value of such leverage is usually in orders of magnitude compared to the original loan. Add that to the political value, and "present-day colonialism" comes out as the sum at the other side of the equation One can read more about this "game" in the confessional, Confessions of an Economic Hit Man by John Perkins.

And this:

The windfall alone from the current Oil price spikes is sufficient to pay off Nigeria's debt of $38B --right now. But why isn't Nigeria doing that? For the same reason that Nigeria failed to pay off this debt back during the first and middle Oil crises of the recent past. The windfalls were stolen and pocketed by Nigerian leaders, and up till today, no one has given an account of the money. The loot was saved in lender-nation banks and other financial institutions. The Nigerian Press and elected officials have pressed General Obasanjo to give an account of the Oil windfall for the past 3 or 4 years running, but he has refused to; there is no will or way to pry the information out of him. The Nigerian constitution calls for a Minister / Ministry for Oil, like in most other Oil-producing third-world countries; but General Obasanjo refuses to appoint one (he states that he does not trust any Nigerian to handle this job). So, in fact, he is also serving as the Minister / Ministry for Oil, except that "his Ministry" is inscrutable.

Now, of course, the lender-countries could put sufficient pressure on General Obasanjo to use the Oil windfall to pay off the debt. Easy enough! but only if one has already forgotten that the loans were configured NEVER to be repaid in full! On the other side of this coin, consider that a full pay-off of the debt will take away General Obasanjo's excuse for why the peoples of Nigeria are continuing to suffer: where and how will he find another scapegoat?

It is expedient for some US officials to be pegging debt relief for Nigeria on Nigeria's release of the war criminal, Taylor, currently allowed in exile in Nigeria. But, that's a side-excuse. Nigeria's human rights records under Obasanjo are just as bad as those of Taylor, considering what he and his government are openly doing against the Igbo-Biafrans, and going by the UN Human Rights Commission Reports. (By the way, the so-called Nigeria's Oil comes from former Biafran territory.) And, General Obasanjo's current political record in Nigeria, a record which is public, makes him a dictator--even worse than when he was a Military Head of State of Nigeria back in 1979. Corruption? That's really what decides the fate of any money given to Nigeria. The General is mired in it: perhaps, he can explain how his private farm went from near bankruptcy in 1998 to a $30 million per month operation today, by his own admission.

So, here we are, the US dealing with a corrupt dictatorship with a poor human rights record, and rewarding it with "debt forgiveness," pretending that the peoples suffering and dying in Nigeria will actually benefit from such "generosity" when it is really clear that this could never be the case? This is the 21st Century--AD?

Related Links:- 
Obama Ties Debt Relief to Taylor Handover
Bush and Blair exclude Nigeria from debt relief
Nigeria in talks for $31 bln debt buyback
2000: Nigerian Senate backs debt buy-back
"Nigeria is Poor, O!" says President Obasanjo
Nigerian decision baffles investors
$170b owned by Nigerians in foreign banks worries EFCC
Commentary: The Need For Africa To Wake Up
Africa Wake Up Call: 'Oil drilling' to shift to moon
Commission for Africa Report
Poverty In Africa & The Commission For Africa Report
Dictators: From coup to stuffed ballot box
African Dictators: Pillage & Plunder