Politics and economy in contemporary Nigeria Failed attempts to overcome politicization

of ethnicity through institutional design Overwhelming dependence on oil

Nigeria

Overwhelming dependence on oil

Loss of export diversity Loss of revenue diversity

Composition of Nigerian Exports

Agriculture

Agriculture

Agriculture

Agriculture Agriculture

Oil

Oil

Oil

Oil Oil

Other Other OtherOther Other

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1960 1965 1970 1975 1980

Other

Oil

Agriculture

Destination of Nigerian Oil Exports

Oil Taxes and Royalties as % of Federal Government Total Revenue

Oil Share %1970 271975 781980 811985 781990 781995 82

Overwhelming dependence on oil

Increased vulnerability to changes in global marketDebt crisis (like Mexico) IMF “structural adjustment program”

Reduce role of state Liberalize trade

NOT followed (less like Mexico)

Ongoing Challenges to Democratic Rule

Conflict in Niger River Delta over Oil WealthProtests by

Local communities Ogoni Ijaw Others

Oil union workers

Overwhelming dependence on oil

Reduced bargaining power vis-à-vis multinational corporations Nigeria needs MNCs

Technology to extract, refine oil Oil = ~ 90% of export earnings Oil = ~ 80% of state revenue

Ex: 1990s Shell produced 50% of all Nigeria’s oil

<10% of Shell profits from Nigeria

Overwhelming dependence on oil

Environmental degradation Effluents from drilling leak

into soil, water Oil flares cause air

pollution, acid rain Agriculture, fishing,

drinking water contaminated

Shell acknowledged lower environmental standards

Overwhelming dependence on oil Reduced bargaining power vis-à-vis

multinational corporationsShell operations concentrated in Ogoniland in

SE Nigeria, Niger River Delta1990, Ogoni people began to organize in

protest Violent protest and political repression

Violent attacks on Shell facilities Shell calls on Nigerian government to maintain order Hanging of Ogoni leader under Abacha regime

Unequal distribution of profits Oil controlled at national level—little to Ogoni

Lack electricity, piped water

Movement for the Survival of the Ogoni People (MOSOP)

Video clip

http://www.youtube.com/watch?v=zalqYjcjA2Y&feature=related 6:13

Review of theories

As applied to Nigeria

15

Neo-colonialism by core countries

The exercise of economic and cultural domination over a nominally sovereign state by a core power, often through the presence of multinational corporations based in the core and through the extension of bilateral military aid, without establishment of a formal colonial administration.

Statist Theory

Characteristics of predatory state bureaucracyRecruitment based on patron-client tiesPolicy based on personal benefit not missionNot insulated from societal pressuresLacking in ability to formulate good policyLacking in authority/power to implement policy

Neo-liberal Theory Deepak Lal, UCLA

State intervention is the problem, not the solution “From the experience of a large number of

developing countries in the postwar period, it would be a fair professional judgment that most serious distortions are due not to imperfections of the market mechanism but to irrational governmental interventions.”

Dichotomy between modern & traditional (version 1)

Modern values Traditional values achievement-oriented ascriptive rule/merit-based reliance on personal ties active passive rational non-rational, superstitious

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Dichotomy between modern & traditional (version 2)

Civic culture attitudes Traditional attitudes trust distrust satisfaction low satisfaction

competence low competence

20