To the grievance of many Nigerians, more often than not the West African state is commonly associated with themes of corruption and resource mismanagement. Nigeria, as many other so-called third world countries who are resource rich, suffers from the resource curse.
Nigeria has the 11th largest proven oil reserves in the world, making it a key oil producing nation with oil-related exports making up 90% of Nigeria’s total export earnings since the 1970’s.
Yet oddly enough roughly 70% of Nigeria’s population, nearly 110 million people, live underneath the poverty line. Further adding to the mystery, the Niger Delta, where most of Nigeria’s oil is sourced suffers from the highest rate of youth unemployment, the worst environmental degradation levels, and one of the largest wealth gaps in Nigeria.
This unequal relationship between abundant resources and socio-economic and developmental progress is commonly known as the resource curse. It is assumed that this is in large part due to government corruption and neglect. However, is it truly fair and accurate to place the blame solely on the Nigerian government, or do they merely prove to be the easiest scapegoat in the picture? Surprisingly, there is another major player in the corruption surrounding Nigerian oil.
In the late 1990’s, a conference was held among several civil and political organizations in Nigeria with the overarching theme of corruption plaguing the country. Following the presentations by each group at the conference, a series of recommendations to root out corruption in Nigeria were agreed upon.
The Institute of Academic Freedom in Nigeria, or IAFN, named major oil companies as being involved in two particularly prevalent forms of corruption. The bribing of public officials, of high and low levels of government, and the misapplication of funds. Furthermore, the IAFN recommended that the Nigerian government should implement a system of regulations that would prevent oil companies from influencing government policy, on both the federal and municipal levels, through bribes to civil servants and chiefs of towns located in key oil rich regions across Nigeria.
The six richest individuals in Nigeria in 2015 were all tribal chiefs in key oil producing regions, with the exception of an army commander, and together had a striking income of $1.3 Billion per month.
However while observing media reports on corruption and resource mismanagement in Nigeria, rarely does one see large transnational corporations, such as Shell, being held accountable for their role in facilitating the same corruption for which the Nigerian government is constantly facing scrutiny.
This key note begs the door of investigation to be opened in other African and non-African, resource rich countries who suffer a similar dilemma of foreign companies facilitating and promoting corruption. As a matter of fact, it becomes a question of whether corruption around resources is truly possible without the facilitation of foreign corporations and entities. Following the death of the Nigerian military junta leader Abacha, and the consequent collapse of his regime in the late 90’s, over 1.8 billion dollars were seized from his offshore accounts in such distant lands as Brazil, Lebanon, Britain, and Switzerland. Were the banking institutions and contracted oil extraction companies truly oblivious to his theft of the fruits of Nigeria’s natural resources, or was it a matter of mutual understanding?
It is, in fact, the industry surrounding Nigeria’s oil, rather than the resource itself, that has become an economic chokehold and obstacle for the country. The influence of multi-national oil corporations has attained such an extending reach through bribes that they effectively carry their own political weight and voice in Nigeria. This has essentially allowed them to almost govern themselves with little or no government oversight. Oil spills in the Niger Delta have been primarily caused by human error, the negligence of employees, and mechanical failure caused by old infrastructure. The latter is a particular issue with Shell facilities since they have not replaced or renovated most of the infrastructure that was laid out in the 1960’s. The response from oil companies, given the lack of enforcement of international law, was to dismiss the thought of such spills being harmful due to the alleged lack of scientific evidence on their effects.
When the Ogoni people of the Niger Delta demanded environmental protection and a fair share of profits from the oil extracted in their land, the Nigerian government declared in response that any disturbances caused to the Nigerian oil industry would be considered high treason.
It seems as though the facilitation of corruption by multinational oil companies, the neglect by the Nigerian government, and the lack of regulation and law have not only transformed a blessing of resources into a curse on the people of Nigeria, however, it has transformed the Nigerian oil industry into a quasi-neo-colonial tool.