Nigerians reluctant to invest in their country
Yawu Miller
Ibrahim Awolo’s detailing of Nigeria’s wealth took more
than half an hour. Aside from the petroleum that fuels the West
African nation’s faltering economy, there are vast untapped
reserves of iron ore, gold, salt, talc, gypsum, coal, tantalite
and other minerals.
“Potentially, Nigeria should be one of the wealthiest countries
in the world,” Awolo told the 50-or-so Nigerians crowded in
a Roxbury Community College classroom Saturday. “But we all
know of our management problems.”
The management problems Awolo referred to include many common to
former European colonies — a lack of transportation infrastructure,
deep ethnic and religious divisions and, as many in the audience
pointed out, crime.
“The resources you mentioned are not new to us,” said
Ugocha Chimedu. “When I was in elementary school I learned
all about our tin and salt. But the issue is not that people aren’t
investing. The problem is there’s no security and no roads.”
Nigeria was colonized by the British in 1861 while England and France
were competing for domination in West Africa. Like most of West
Africa, Nigeria was a key source for the Atlantic slave trade exporting
as many as 30,000 Africans a year.
Like many European colonies, Nigeria was used by the British as
a source of raw materials. It’s infrastructure was developed
by the British with the aim of moving natural resources out of the
country. Although there are more than 250 million people in West
Africa — a sizeable market — there are few if any road
and rail links between the countries in the region.
Perhaps the greatest impediment to Nigeria’s economic development
has been a series of military coups that began with the nation’s
independence from Britain in 1960. The election of Olusegun Obasanjo
in 1999 officially broke the succession of coups.
But poverty has persisted in the country. With a population estimated
at 134 million, 70 percent of Nigerians live in poverty. Oil production
accounts for 80 percent of government revenue, but little oil wealth
trickles down to the Nigerian people.
In the oil-rich Niger Delta region, activists have waged a long
campaign against what they say are corrupt practices of the Shell
Corporation and the Nigerian government’s failure to share
oil resources with the people. Ten years ago, activist Ken Saro-Wiwa
and eight others from the Ogoni ethnic group were hanged after a
series of non-violent protests.
Although the country has 35 million barrels in proven oil reserves,
none of its six refineries is currently working. True to the colonial
model, Nigeria still exports raw goods and imports refined products.
When questioned about the lack of security and infrastructure in
Nigeria, Awolo pointed to foreign investment as the solution.
“The focus in Nigeria is on investment,” he said, telling
the audience that foreign investors can own up to 100 percent of
Nigerian companies. Nigeria is offering investors incentives to
invest in and create new companies including tax exemptions, exemptions
from customs and duties and removals of price controls.
The government is also privatizing industries including utilities,
auto manufacturing plants and telecommunications.
But investors face considerable hurdles in Nigeria, according to
the audience members.
“You have to convince us — or anybody — that our
lives are not in danger,” Chimedu said. “And that if you
do die, someone will be brought to justice.”
Awolo said the lack of security and infrastructure in Nigeria is
due to the lack of a tax base in Nigeria. He argued that investment
would create more jobs and more tax revenues that will enable the
government to provide basic services.
He urged investors to take responsibility for the development of
the country.
“People should be asking what the private sector can do,”
he said. “People say the cost of doing business in Nigeria
is high, but that’s because everybody has folded their arms
and expects the government to do everything.”
Awalo told the audience they could build roads, collect tolls and
help build the infrastructure necessary to promote economic growth
in the country. But some in the audience questioned the Nigerian
government’s fiscal responsibility.
“In what way has the country made use of the windfall profits
from oil in the last two years,” asked one audience member,
noting that the government had made spending projections based on
estimates of $24 a barrel when the cost of oil has increased to
$64 a barrel. Awolo did not provide an answer to that question.
Some audience members seemed frustrated with Awolo’s message.
Many said they had come to the meeting, sponsored by the Boston-based
Greater Nigerian Society of America, simply to renew their passports.
The meeting provided members of the local Nigerian community with
an opportunity to meet with officials from the Nigerian consulate
in New York.
“You’re telling us to build roads,” said Chucks
Okoli. “But the basic foundation has to be there. There has
to be infrastructure. There’s no company in this country that’s
going to operate of a generator. They need electricity.”
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