Continued from Monday, December 11, 2023
2023, as Capitalism is discredited again under the Nigerian ruling class
ON APRIL 5, 2017, the Buhari administration launched its economic blueprint which it called Economic Recovery and Growth (ERPG) programme. The ERGP was alleged to be the means of getting Nigeria out of economic woods and make life better for Nigerians. The ERGP was erected on the World Bank-derived policy that the so-called private sector will lead the Nigerian economy. The policy among other things is erected on what, over time, has been characterised as neoliberal economic policies and it is dictated and supervised by the global financial institutions (the IMF, the World Bank) and their subsidiaries such as African Development Bank (AfDB).
Consequently, those who wreck a particular company (bank, road construction, hotel, industry, power companies, etc.) are found also to own, or part-own several other companies and businesses that keep ripping off Nigeria. The capitalist “limited liability” paradigm of class reproduction ensures the maintenance and longevity of this mutually-reinforcing relationship between private accumulation and state (political) power.
The launching of ERGP, two full years after General Buhari became President is pivoted on all the principles and conditionality’s that underpinned the programmes of enslavement of Nigerian masses since 1977 and especially since 1984 (SAP, Vision 2010, NEEDS, Vision 2020-20, etc.!): devaluation of the Naira; withdrawal of subsidies from PMS, agriculture and social services—education, health, etc.—reduction in public service establishment, privatisation and auctioning of public assets, imposing more taxes on the poor (VAT, etc.); killing of local industries via trade liberalisation, deregulation of wages and crack-down on trade unions, using government money and facilities to promote the enrichment of big business etc.
These were all elements of the same programme which the military wing of the ruling class forced on Nigeria especially since 1984 when it was clear to the World Bank that their Nigerian agents in civvies could not proceed safely with the program. That is where we have been, and it is not surprising, the same neoliberal forces and personnel have been ripping Nigeria off since in the last forty years
“Thief carry am, Thief collect am!”: Enter Assets Management Corporation of Nigeria (AMCON)
Section 1(1) of the Assets Management Corporation of Nigeria (AMCON) Act established the corporation. It was an Act to establish the asset Management Corporation of Nigeria for the purpose of resolving the non-performing loan Assets of Banks in Nigeria. The Act came into law on the 19th of July, 2010; AMCON is said to be “… created to be key regulating, stabilizing and stabilizing tool established to revive the financial system by efficiently resolving the non-performing loan assets of the banks in the Nigerian economy.” [amcon.com.ng: accessed October 13, 2022].
In the last two decades or so of neoliberal globalisation and in all capitalist economies, finance (banking), insurance and real estate (FIRE) dominated. It is not different in Nigeria. Having been fully privatised especially since the SAP of the mid-1980s, investors in the banking sectors manipulated and profited from the control of the sources of credit. By the early 2000s, many of the banks were ruined via toxic loans leading to collapses, mergers and forced recapitalisation.
Debts of many of the allegedly commercialised and privatised companies were funded with tax-payers’ money (as direct bailouts and through government rescue of indebted companies such the energy costs incurred by the power Generating Companies (GENCOs) following the so-called unbundling of the Power Holding Company of Nigeria (PHCN).
Needless to say, the acquired enterprises were destroyed by their acquisitors; the loans became toxic and the lending banks were bankrupt or threatened with bankruptcy. Once this happened, AMCON (Assets Management Corporation of Nigeria) set up by their government came to the rescue of the rampaging acquisitors of the public resources via various strategies of quantitative easing (bail-outs, etc.) as exemplified by scandalous examples as in the banking and electricity generation and distribution sectors.
Needless to say, because those who control government and government power, along with their friends and business partners, also own the companies that suck blood from workers, tax- payers and the country, AMCON serves largely to protect capital and capitalists; the companies owing AMCON are owned by who-is-who in Nigeria!
Consequently, those who wreck a particular company (bank, road construction, hotel, industry, power companies, etc.) are found also to own, or part-own several other companies and businesses that keep ripping off Nigeria. The capitalist “limited liability” paradigm of class reproduction ensures the maintenance and longevity of this mutually-reinforcing relationship between private accumulation and state (political) power.
And when these relationships between government power and capitalist power cannot hide anymore, the facilitators try to confuse the people and lie to them especially when the victims begin to understand. Buhari’s Minister of Works and Power was in the news: Fashola (on PPP, Privatization; Channels’ [Sunrise Daily]: “It Can’t Be a Governance Model; Fashola Faults Candidates Promising Privatisation” Channels Television [Sunrise Daily] Updated December, 21,2022):
“… it cannot be an official model of governance … That was the model that we met [PPP] They [the private sector] don’t even have the capacity…”
Employment by private companies [according to Fashola in the report]: Micros: less than, or equal to 10 people; Medium < 50 people; Small < 200 people….
[Buhari’s government] priorities repatriation of funds stolen by previous officials… to fund its infrastructure projects”.
CAST-Nigeria Understanding of Nigeria’s Economic Crisis in 2023 and beyond: Privatisation, looting of public assets, and continued, enrichment of the ruling class; AMCON as ruling class panacea.
On October 2, 2022, the Campaign for Socialist Transformation of Nigeria (CAST-Nigeria) Campaign Organisation addressed a press conference in Abuja on the nature and consequences of Nigeria’s unending economic and social crisis; that was as the ruling class was perfecting the illusions around the then upcoming 2023 General Elections. A summary of the perspectives of the press conference, especially concerning the role of ruling class private wealth accumulation as the underlying cause of unending economic crisis, mass poverty and breakdown of infrastructures, educational and health institutions, etc., is outlined below.
Once the “civilian” segment of the Nigerian ruling elites settled down in power as allegedly democratically-elected government in 1999, the ruling class proceeded full scale to privatise remaining public assets as previously ordered (as a key element) by the World Bank in the Structural Adjustment Programme which the military wing of the Nigerian elite came to enforce after the overthrow of the Second Republic (1979-1983).
Two important bureaucracies, Technical Committee on Privatisation and Commercialisation (TCPC) and the Bureau for public Enterprise (BPE) were established to oversee what some media outlets described as “RIP OFF” of Nigeria.
No matter what segment of the morphing political wing the key players belong to, the auctioning was frenzied and feverish. The OBJ team that supervised the auction project was led by Atiku Abubakar and Nasir El-Rufai facilitated by World Bank Nigerian technocrats who were recruited for OBJ from Washington, USA. It was clear by the 2000s that privatisation was a looting programme as members of the Nigerian elite, spread across the country, invaded banks and other financial institutions to acquire loans and other facilities to buy the public assets that were being auctioned literally and at give-away prices. In many cases, the buyers did not, and still do not, even, pay!
Needless to say, the acquired enterprises were destroyed by their acquisitors; the loans became toxic and the lending banks were bankrupt or threatened with bankruptcy. Once this happened, AMCON (Assets Management Corporation of Nigeria) set up by their government came to the rescue of the rampaging acquisitors of the public resources via various strategies of quantitative easing (bail-outs, etc.) as exemplified by scandalous examples as in the banking and electricity generation and distribution sectors.
But beyond, the pampering of those who become rich capitalists overnight, via primitive and related accumulation, ruling class governments, especially from 1999 to date, have continued to preferentially enlarge the accumulative and exploitative capacity of their class collaborators and business partners.
In crude oil trade and solid mineral mining trade, the ruling class governments have continued to give special support to capitalist companies in spite of the growing inequality and poverty in Nigeria caused especially by escalating unemployment and withdrawal of public funds from education, health, basic civil infrastructure, rural and urban security, and food security.
Of course; it is a generally known fact today that World Bank loans are veritable means of continuing the enslavement of peoples in countries like Nigeria via World Bank conditionalities that insist on privatisation of public resources, liberalisation of trade and killing of local industries, imposition of more taxes, and the removal of so-called subsidies, etc. These are all aided by the Nigerian ruling class from one government to another.
While revenues from Government-Owned-Enterprises (GOEs) are being embezzled or otherwise unaccounted for, as we show in other parts of this document, various sources of public revenue are awarded as gifts to capitalist foundations while workers and pensioners are unpaid for months on end while VAT increased on various purchases and as fuel price and school fees and cost of living increase generally. Big capitalist companies such as “Dangote, Lafarge, Honeywell and 43 other major beneficiaries” reportedly received tax wavers, concessions and relief totalling N16.7 trillion between 2019 and 2021 (Sahara Reporters: September 19, 2022). The requests for similar waivers, concession and reliefs by another 186 companies are reported to be pending and means of maintenance of ruling class-power.
It is left for us to emphasise that the processes of the fraud associated with what they generally refer to as “waivers” had always been traditionally opaque and the same coterie of capitalists have been profiting from them! A report of February 4, 2014 news was carried by Ships & Ports in 2022 titled, N1.4trn import duty waivers: Lawmakers probe NNPC, Oando, Dangote, Coscharis!—waivers granted by Nigeria’s Federal Government between 2009 and 2013! That was more than one decade ago! Regime after regime of the ruling class, nothing has changed.
The loss of revenue to government arising from waivers, etc. discussed above is directly related to revenue losses to Nigeria arising from outdated conditions for deep off-shore Production Sharing Contracts signed between the NNPC and the International Oil Companies and in which government officials ignored 2015 legal advice that the contracts that subsisted since 1993 be reviewed in favour of Nigeria (see Brisktrade: Brisktrading.net; August 14, 2017)
Yet in 2014, CBN advances to the Federal Government of Nigeria was N256.70 billion, the advances rose by more than 7000% to N18.89 trillion in 2021. CBN advance is, of course, generally considered to be a euphemism for CBN printed money!
According to a report by Dave Ibereme (legit.ng: October 12, 2022), “CBN prints another N4 trillion in seven months for President Buhari as Debt Hit N22 trillion” (see Table on the escalation of Nigeria’s debt profile below), the total amount printed is said to have increased from N789.7 billion in 2015 to more than N22 trillion in 2022 and up from about N17 trillion in December 2021. The report also noted that crude oil price had increased in that period.
National Debt Increases, Nigerian Government borrows more, CBN Prints more Naira, and spends profligately!
FG Debts: 2011- 2021(N)
Year Domestic External Total
2011 5.7 546bn 6.17trn
2021 19.2trn 13.86trn 33.11trn
Increase by 435% Increase by 242% Increase by 2,435%
Source: AGORA POLICY
While budgeted FG revenue and actual revenue were N3.35 trillion and N2.57 trillion respectively in 2011, and the corresponding categories were N6.77 trillion and N4.63 trillion in 2021. It is also significant that FG’s expenditure was N4.48 trillion in 2011 and N12.5 trillion in 2022.
On top of all of this rain of revenues, according to a Report in October 2022, “The World Bank announced $750 million credit line to Nigeria for helping 36 states in Nigeria to push through reforms which will [allegedly] ultimately attract investment and create jobs…”. That is apart from a recent report that the European Union (EU) offered Nigeria $1.7billion allegedly “to diversify the economy”!
Of course; it is a generally known fact today that World Bank loans are veritable means of continuing the enslavement of peoples in countries like Nigeria via World Bank conditionalities that insist on privatisation of public resources, liberalisation of trade and killing of local industries, imposition of more taxes, and the removal of so-called subsidies, etc. These are all aided by the Nigerian ruling class from one government to another. This is why the launching of Buhari’s Economic Recovery and Growth Program (ERGP) of 2017 came directly four months after the instructions from the World Bank other-wise known as Article IV Understanding earlier in 2017 (see Uchenna Uwaleke, Reflections on IMF 2017 Article IV consultation with Nigeria; Jide Ojo, If Buhari’s ERGP will not be a paper tiger: The Punch, Wednesday April 19, 2017, p. 20).
Big Business and individuals keep “Ripping Off Nigeria”
(1) Dangote Cement Dispute with Kogi State of Nigeria illustrates the virulence of the power of capitalists over and above government power especially when there is a conspiracy between the two!
(2) Federal Government of Nigeria is killing the Government-owned Refineries; funding (FGN Investments in) Dangote Refineries amounting to $2.7bn 20% stake worth billions; and guaranteeing Crude Supply of 300 thousand barrels daily to it. All these with Tax Wavers to Dangote.
Over the last decade or so, it is generally known, governments of Nigeria incurred revenue losses because revenue-collecting or generating agencies have abandoned their responsibilities because they profit directly from such irresponsibility. They have either not collected or they have collected and either sat on the revenue (instead of remitting into the federation account) or they have neither collected nor cause the appropriate agencies or companies to make payments or remittances.
Big business and environment crisis: big business in agriculture; crude oil, mineral explorations, and other extractive industries occasioning air, land and water pollution, monocultures, deforestation, pesticides, seed companies’ monopolies and erosion of crop biodiversity, GMOs; inorganic fertilizers.
Private Land acquisition: turns native landowners and communities into labourers on their own land (again as in case of Dangote Cement; as in the plethora of criminal seizure of peoples’ land at Otta, Malete in Kwara State, and at Mambila, Nasarawa and Cross Rivers States, etc,) thus generating and exacerbating a plethora of inter-community violence across Nigeria and varieties of ecological emergencies such as flooding gully erosions, etc.; export promotion of raw material returns Nigeria to full neo-colonial economic relationships and exploitation; Private ownership of oil wells and oil blocks – privatise and destroy communal environments; avoid costs of remediation to keep profits high.
Spending sprees at all levels:
(1) Security Votes;
(2) State Governments jets and chartered flights
(3) General Privatisation of the State resources by parastatals and MDAs
Direct Stealing of Proceeds from oil; PIB is virtual privatisation of NNPC;
Oil Smuggling; Oil theft; NNPC as Cash Cow!
“Nobody really wants to know how much oil is consumed daily in Nigeria because state functionaries are stealing the proceeds; they must then blame smugglers”.
And when they say they are “creating jobs” it’s always a stupendous fraud! How much do they pay? How secure are the jobs? How much of trade union rights which enable workers to negotiate conditions of service, exists?
Uncollected Revenue or Collected Revenues Not Unaccounted for: The Cash Cows: CBN (VAT uncollected; unremitted since 2015); GOEs; Customs; JAMB; CBN Currency Printing; NPA
Over the last decade or so, it is generally known, governments of Nigeria incurred revenue losses because revenue-collecting or generating agencies have abandoned their responsibilities because they profit directly from such irresponsibility. They have either not collected or they have collected and either sat on the revenue (instead of remitting into the federation account) or they have neither collected nor cause the appropriate agencies or companies to make payments or remittances.
Massive uncollected revenues include various ones referred to by Femi Falana, SAN, in letters to agents of the Federal Government of Nigeria in the last several years (according to the reports by Brisktrade, This Day, Channels TV, The Punch, and other media outlets.
Among others; (1) $62 billion is said to be withheld by international oil companies (IOCs)in the last eighteen years; (2) $22 billion and $481 billion are said to be withheld from Nigeria’s Federation. Account, by the Nigerian National Petroleum Corporation (NNPC) according to the National Extractive Industries Transparency Initiative (NEITI); (3) Oil companies are reported to have custody of unrecovered $21 billion being the value of crude oil allegedly stolen and discharged at Philadelphia Port in the United States between 2011 and 2014; (4) “… the management of the Central Bank of Nigeria ( in 2006) illegally withdrew $76 billion from the nation’s foreign Reserves and fixed same in 14 commercial banks… the Governor of the Central Bank, Mr. Godwin Emefiele has consistently ignored our persistent demand for the recovery of the principal sum of $7 billion dollars and the accrued interests….”
Uncollected (or is uncollectable?) Debts owed by the few rich: 100 companies, individuals, owe Asset Management Corporation of Nigeria (AMCON) N953.43 billion in 2016.
We have referred somewhere else in this document to horrendous sums of public money which the ruling class use to aid their class who have taken over public resources and enterprises, and destroyed them.
Like the uncollected revenues we referred to earlier on, debts owed by members of the ruling class and taken over by the Assets Management Corporation of Nigeria (AMCON) are unpaid, uncollected or are largely uncollectable.
Members of Nigeria’s ruling class are able to assert and maintain their influence in various aspects of oil production via award of prospecting licences, ownership of oil blocks, supervision of direct stealing of crude oil and imposition of taxes on consumption which they call removal of oil subsidies.
In a report of July 28, 2016 giving details of debts owed AMCON by 100 companies and individuals, O. Penelope observed: “The Nigerian businessman have for decades survived on bank loans. While they make huge profits from ventures and have risen to the top of the industries where they operate, they hardly pay back loans. They plunged the banking sector into crisis years ago before the Assets Management Corporation of Nigeria (AMCON) bailed out the banks, buying all the bad loans, priced at nearly N2 trillion. But years after AMCON intervention, many of these businessmen have refused to settle their obligations with the company (AMCON).
… the Central Bank of Nigeria (CBN) instructed AMCON to publish the list of 217 chronic debtors. The Company has published a list of 100 out of a total of 12,744 obligators on its books, with debts totalling #953.43 billion ($3.4 billion). However, the list is only the first batch of many to be published…. The amount owned by 400 obligators can cater for more 70% of Nigeria’s 2016 budget.”
Senate Probes NDLEA for Spending N200 million on Security vote without Budgetary Allocation (Samuel Ogidan: Independent January 16, 2022).
This “probe” by senate in 2022 was in respect of Auditor General queries of 2016 (2016!) regarding unbudgeted expenditure and unauthorized overspending beyond budgeted spending profiles. As we show repeatedly in this statement this is standard practice among revenue- collecting agencies whose bosses are direct appointees of government leaders under whose noses all manners of stealing and misappropriations occur!
What happened to N89 trillion Stamp Duty collected by Central Bank of Nigeria?
Our money and the Big story that is Never told; By Jubril Ibrahim.
A Presidential Committee was set up in June 2022 to collect Stamp Duty from 2015 to date.
N89 trillion Stamp Duty was collected. Only 60% was remitted, Hon. Gudaji Kazaure “raised the alarm of the theft of stamp duty precedes. He says Emefiele is essentially the beneficiary of the budget fraud in Nigeria’s history as the CBN sends only 60% of stamp duty revenue to government…” (National Record Dec. 23, 2022)
Oil and Oil money as a central source of private accumulation.
While oil money that goes directly into public treasury feed the accumulation and corruption machine, oil money in the custody of Government-Owned-Companies (such as NNPC) and International Oil Companies (IOCs) also form the mainstay of private accumulation by the generality of Nigeria’s ruling class the bureaucracies, and other arms of government (executive, legislative etc.)
Members of Nigeria’s ruling class are able to assert and maintain their influence in various aspects of oil production via award of prospecting licences, ownership of oil blocks, supervision of direct stealing of crude oil and imposition of taxes on consumption which they call removal of oil subsidies.
Whichever way we look at it, stupendous amount of money from Nigerian crude oil, solid minerals, taxes (from income, company, VAT, etc.) petrol-subsidy, duties etc., is in the hands of the tiny ruling class spread across all ethnic and confessional groups in the country. The wealth in the custody of this tiny group fund their political parties and power, generate and maintain poverty and inequality, keep the victims down by police and military power, and keep the victims divided by generating!
Because of the obvious centrality of crude oil production and sale in primitive accumulation, overlapping regimes strive to concoct all kinds of stories as to how crude oil is stolen, smuggled and how such activities affect the aggregate revenue that is available to government for meeting its obligation to the Nigerian public.
The fluctuations in crude oil price and production levels, had been central elements of the excuses that the ruling class tout consistently to justify and cover up their pillage and liquidation of public accounts which they call corruption and to explain and excuse their irresponsibility.
First of all, everybody knows that for all sorts of reasons, avoidable and unavoidable, crude oil production and price are bound to fluctuate. The ruling class governments actually invariably erect very low bars for crude oil revenue during annual budgeting exercises. They, therefore rake in, invariably, more oil revenue than they actually project in the annual budgets.
Some statistics concerning the above will be in order. In January 2011 crude oil (CO) production was 2.9 million barrels per day (mbd); it dropped to 1.08 mbd in 2021. Most attention for this decline was diverted to oil theft etc.; but there is ample evidence that a lot of the decline also arose from decaying and out-dated facilities.
But all the decline (by 56.63%) in production notwithstanding, Government revenue (in Naira) more than quadrupled (300%) as a result of massive Naira devaluation. And having regard to all sorts of other sources of money available to government (as discussed already), public treasury had been constantly awash with money (Naira) and dollars (the latter especially since March 2022 when crude oil price jumped to $117.25 per barrel); it was $79.8 dollars in December 2022 (see macrotrends.net; AGORA POLICY).
Capitalism is the cause, corruption is only a consequence: Capitalism concentrates wealth, the few rich control political power, the masses are the victims.
Whichever way we look at it, stupendous amount of money from Nigerian crude oil, solid minerals, taxes (from income, company, VAT, etc.) petrol-subsidy, duties etc., is in the hands of the tiny ruling class spread across all ethnic and confessional groups in the country. The wealth in the custody of this tiny group fund their political parties and power, generate and maintain poverty and inequality, keep the victims down by police and military power, and keep the victims divided by generating!
Precisely because a tiny minority owns Nigeria (the banks, the real estate everywhere) and use political power of access to the treasury to steal what they don’t own, poverty has escalated.
According to AGORA POLICY, between January and June 2022, N1.59 trillion was expended on “petrol subsidy” whose existence had been disputed by various individuals and organisations. And in these regards we quote extensively below from the report by The Punch (Punch Newspapers 9th Sptember, 2022) on the alarm by Nigeria Customs Service on the so-called petrol subsidy including NCS’s call for a probe:
“The vexed issue of malpractices associated with petrol imports, supply, and subsidy, has bounced back forcefully into the public space. Coming under appropriate scrutiny at the House of Representatives Committee on Finance, data from the Nigerian National Petroleum Company Limited on products released and consumed daily did not add up. They never have, and this calls into question institutional practices and accountability. With a prohibitive N6.4 trillion subsidy bill haunting the 2023 federal budget, the haemorrhage must be stopped.
“Once more, the NNPC’s opaque corporate culture is in focus. Its claim of releasing 98 million litres daily into the market alarmed the Minister of Finance, Budget and National Planning, Zainab Ahmad. She said that with this, subsidy would cost N6.4 trillion and result in a deficit of between N11.30 trillion and N12.41 trillion in the proposed N19.76 trillion budget.
The growing crisis of poverty in Nigeria today has a long history that started getting visible to everyone especially since when the ruling class robbery became armed in 1984 under the armed wing of the Nigerian ruling class supervised openly by IMF via SAP!
“This attracted an outraged riposte from the Comptroller-General of the Nigeria Customs Service, Hameed Ali, who punctured the NNPC’s claims.
“Ali posed pertinent questions that suggested fraudulent practices at the rebranded company; “If we are consuming 60 million litres of (PMS) petrol per day, by their own computation, why would you allow the release of 98 million litres per day? … Scientifically, you cannot tell me that I fill my tank today, tomorrow, I will fill the same tank with the same quantity of fuel.”
“Dismissing the notion of smuggling accounting for the entire difference between local consumption and the market supply, he asked; “If you release 98 million litres in actual and 60 million litres is used, the balance should be 38 million litres. How many trucks will carry 38 million litres every day? Which roads are they following, and where are they carrying this thing to?”
“Moreover, figures of total consumption in West Africa do not support the purported daily injection of 30 million litres smuggled from Nigeria. For years, several stakeholders, including this newspaper, have consistently questioned the volume of petrol the NNPC claims to be supplying and the attendant sums it withholds from the Federation Account to cover its mysterious “under-recoveries”. In February, the Minister of State for Petroleum Resources, Timipre Sylva, admitted that NNPC’s daily consumption figures were questionable, describing them as “crazy and opaque.”
For all of the 12 months of 2022, N4.28 trillion (N462 billion for social development and poverty reduction, N876 billion for health, N1.34 trillion for education and N1.42 trillion for infrastructure). Consequently, oil subsidy is over 25% of the total budgeted expenditure on social services and infrastructure. This had been the pattern of ruling-class extortion since the late 1970s!
It is no wonder, then, that general unemployment rose from 5.9% in 2011 to 33.3% in 2021; and youth unemployment rose from 8.04% in 2011 to 42.49% in 2021.
Stealing by Public Officers, Governors’ spending spree, and other forms of Capitalist Accumulation: The “Tip of the Iceberg”
The growing crisis of poverty in Nigeria today has a long history that started getting visible to everyone especially since when the ruling class robbery became armed in 1984 under the armed wing of the Nigerian ruling class supervised openly by IMF via SAP!
Being a Public Lecture delivered at the 8th Quadrennial Delegates Conference of NASU held December 5-7 in Abuja. Emeritus Prof. Olorode, foremost progressive intellectual and elder statesman, is Member, Secretariat Collective, Campaign for Socialist Transformation of Nigeria (CAST-Nigeria) Campaign Organisation. He can be reached via email: omotoopo@gmail.com
