[From time to time we have given coverage to political risk issues in other petroleum and emerging market economies aside from Russia, with a special focus on Nigeria, where the law firm has worked over the past number of years. Today we’re pleased to present the first of three in-depth analysis articles on the upcoming Nigerian elections by the highly regarded columnist Salisu Suleiman, who writes a regular feature for NEXT Newspaper, among other publications. – Editor: Robert Amsterdam]
By Salisu Suleiman
With a net worth of $13.8 billion as reported by the Forbes’ 2011 list of the world’s billionaires, Nigerian Aliko Dangote ranks as the 51st richest person in the world, and the second richest man in the Middle East and Africa behind Saudi Prince Alwaleed bin Talal Alsaud, who is worth $19.6 billion.
Ordinarily, that should be good news for Nigeria and Africa. Except that Dangote may not be the richest Nigerian after all. And that is the problem. Nigeria is Africa’s largest producer of oil and earns tens of billions of dollars in foreign exchange annually. But in what is one of the least transparent processes in the world, government patronage and outright corruption has led to an exponential growth in the number of billionaires, some of whom are reportedly richer than Dangote without making it to the Forbes’ list. And that too, is a problem.
The official census figures of 2006 show that there are about 140 million Nigerians. That figure is disputed in many quarters. The recent voters’ registration exercise captured over 73 million Nigerians aged 18 and above, though not all eligible voters were registered. The country’s population is estimated at up to 180 million, most of them living below the poverty line. For Nigeria, the stakes have never been higher. The country is sitting on a demographic time bomb; some 30 percent of the workforce is unemployed. A recent study warns that the country would have to create 24 million jobs in the next 10 years just to halve unemployment. Rising poverty and unemployment have fuelled religious and ethnic clashes in this country of over 300 ethnic groups. Put all these together against a backdrop 63 parties contesting in general elections spread over three weeks beginning April 2nd, (with a ruling party that simply does not lose elections) and you have a recipe for chaos.
Because wealth and status are largely dependent on proximity to the corridors of power, elections tend to be a truly ferocious affair; senators in the upper legislative chamber earn $1.7 million annually. State governors have almost unfettered access to public funds. Electoral laws forbid donations of more than $7000 to any candidate, but there are no limits to party donations. Reports indicate that the ruling People’s Democratic Party (PDP) may have set aside close to $2 billion to ‘win’ the elections. Some $22 billion from the Excess Crude Account, set up as a stabilization fund remains unaccounted for as at February. Consider this news item reported in a major Nigerian daily:
“In a move targeted at meeting dealers’ rising appetite for forex as the general election draws nearer, the Central Bank of Nigeria (CBN) has increased its supply of dollar at the bi-weekly Wholesale Dutch Auction System (WDAS) to $600 million. The regulator had raised its supply to $400 million at its March 14 auction, from between $200 and $300 million, which it had offered at various auctions in the preceding month. Dealers attributed the trend to panic over the outcome of the forthcoming elections”.
According to the Central Bank, the demand for forex had risen significantly due to the fact that “dealers had been trying to get out, to buy dollars and hedge their risks on election panic”. With so much at stake, it is no wonder that several lives have been lost even before a single ballot has been cast; unscrupulous politicians deliberately fuel ethnic and religious divisions for electoral advantage. Large numbers of unemployed youth provide a pool lowly paid foot-soldiers ready to unleash violence.
When the military left government in 1999, politicians decided on a formula to ensure that the country’s disparate ethnic and religious groups felt a sense of belonging. They agreed that the presidency should rotate between the largely Christian south and mostly Muslim north. The first beneficiary of the arrangement was former head of state General Olusegun Obasanjo who was in office for two terms until 2007. After failing to secure a third (and unconstitutional term), he handpicked Umaru Yar’adua, a Muslim from the north to succeed him based on the outcome of deeply flawed elections. Yar’adua became president in 2007, but died in 2010 without completing the North’s anticipated 8 year tenure. He was succeeded by then vice president Goodluck Jonathan from the south who decided to run for president in contravention of the rotational arrangement. In bitterly contested primaries, President Jonathan was alleged to have bribed each of the thousands of delegates with $7000 each.
In past elections, the Independent National Electoral Commission (INEC) which is the body responsible for the conduct of all elections simply did the ruling party’s bidding by announcing pre-determined results even where elections never held. This year, however, that body is headed by American educated professor of political science and academic Attahiru Jega who is widely respected. Jega has created a fresh voter’s register with imported digital equipment costing over $500 million.
Not all 63 parties have fielded candidates for the presidential elections. Apart from President Jonathan, former anti-corruption chief Nuhu Ribadu and governor of the north’s largest state of Kano, Ibrahim Shekarau are in the race. Mr. Ribadu is running under the ticket of the Action Congress of Nigeria (ACN) while Mr. Shekarau is of the All Nigeria Peoples Party (ANPP). However, the greatest challenge to President Jonathan comes from Mr. Muhammadu Buhari, a former military head of state and retired army General.
Jonathan’s support comes mostly from the political and business elite as well as his native Niger Delta and south east regions. Mr. Ribadu is popular with Nigeria’s somewhat indeterminate middle class and a section of the youth. Mr. Shekarau’s support hardly extends beyond his home state of Kano. By contrast, Mr. Buhari has the support of the poor and downtrodden, and increasingly from outside his traditional base of the north. His supporters often wait all day just to catch a glimpse of him at his campaigns. For a country that is so badly scarred by corruption, the word on the street is: “Buhari was a state governor, an army general, a minister of petroleum and head of state, yet he has no money”. For the many, this personal integrity and stiff opposition to corruption is all that is needed to reform Nigeria and unleash her potentials.
Analysts believe that if President Jonathan is unable to win 25 percent of votes in 24 of Nigeria’s 36 states, in addition to the popular vote as required by law, the elections may go into a run-off. If that happens, the opposition is likely to flock behind Mr. Buhari. In free and fair elections, Mr. Buhari is widely expected to beat the incumbent president. That will be a first in Nigeria. For democracy not only in Nigeria but Africa and beyond, that would be the good news.
But will Nigeria’s elections be free and fair? Will the PDP actually respect the wishes of the people, or will they be up to their old tricks to intimidate voters, stuff ballots, and rig the process? Unfortunately the spate of corruption in Nigeria has reached such heights that the public anger over a manipulated election would be uncontainable, and would propose a crisis of frightening proportions – one that threatens not only the region but also the global economy. This outcome must be prevented at all costs.