Washington, DC — In a first for the Nigerian National Assembly, a delegation of senators, members of the House of Representatives, and officials from the Debt Management Office traveled to Washington, D.C. and several European capitals to lobby for total external debt relief. The legislators' trip during the last week of April came just two months after Nigeria's House of Representatives passed a resolution urging the government to discontinue payments servicing the country's debt, which according to OECD statistics was valued at approximately $37 billion in the fall of 2004. The resolution has yet to come to a vote in the Senate and the government continues to service its debt.
After a week of discussions with U.S. Congressmen and government officials on Capitol Hill, the delegation was headed off to Rome, Berlin, and London to continue discussions with their European colleagues. Two members of the delegation, Senator and Majority Whip Udoma Udo Udoma (PDP - Akwa Ibom) and Chairman of the Senate Committee on Local & Foreign Debts Patrick E. Osakwe (PDP - Delta North), spoke to AllAfrica's Davin O'Regan about the consultations. The senators talked about their attempts to improve Nigeria's image abroad, how Nigeria's peacekeeping forces in West Africa and Sudan have been the embodiment of the popular "African solutions for African problems" mantra, and the many development opportunities total debt relief could provide.
Who have you met with here in Washington, and what reasons have you given them for total debt relief for Nigeria?
Senator Udoma: We've been meeting with congressmen and senators who have an interest in Africa, the reason being that those with an interest in Africa will understand the issues and be sympathetic. We've also been meeting with officials in appropriations.
We have been explaining to them the Nigerian story. Nigeria has a bad history and so there are many people who do not think well of Nigeria. They don't realize that things have changed and are changing - constantly changing. People don't realize the efforts that are being made for greater transparency, lessening corruption. Efforts are being made to reform the economy. Resources are being freed to concentrate on public health, education and the country's basic infrastructure.
We're telling this story. We're telling people how Nigeria has been a helpful stabilizing influence in West Africa, with peacekeeping missions in Sierra Leone and Liberia as well as in Sudan. We informed them about the role Nigeria played [to ensure] that democracy continues to thrive in Africa - the role that we played in Togo in stopping an unconstitutional change in government [and] the role that we played in São Tomé as well.
We also indicate the challenges that Nigeria is facing. The greatest single challenge for Nigeria right now is debt. We need debt relief in order to ensure that the economic agenda works. At the moment, we are spending about $2 billion on debt service every year and yet the debt continues to rise. Over the last two years we've spent over $4 billion on debt servicing, and yet two years ago the level was about $32 billion and now it's about $36 billion without any new borrowing whatsoever, apart from multi-lateral facilities which are rarely significant. The more we pay the more it rises.
It's just an impossible situation. The situation is just unsustainable. Something must be done, so the Nigerian House of Representatives considered this matter, because our constituents keep on asking, "How can we continue? This is something our children and our children's children will still be dealing with if we are not careful." As a result of that, people look at the figures and wonder why we should continue paying. Out of the $36 billion, we're not sure that we actually received projects worth $10 billion dollars. The book value, the amount that we were supposed to receive was about $17 billion, but we didn't get as much as that.
How was the $7 billion gap created?
Senator Udoma: Most of these loans were incurred by the military. Some of them were basically conspiracies between some people and some of the creditors and some of the funds never even reached Nigeria. The loans were also incurred by people not elected by Nigerians, people who did not represent us. I should add that the banks that lent this money have been paid by the various governments because they were under guarantees. It's not as if the banks still have the loans on their books, they don't.
Nigeria's House of Representatives recently passed a resolution calling for the government to stop making payments on its debt. Is the Senate considering voting on the matter?
Senator Udoma: The resolution has yet to come to a vote in the Senate. We are looking to discussing, negotiating and persuading our creditors before we move to vote on the resolution. As a result of our discussions here, we will report back to the Senate, and based on how favorable the reaction is in the Senate, we will decide what position to take.
In what direction do you think the Senate is headed on the resolution?
Senator Udoma: The Senate has not taken a position yet. As democrats, we believe in dialogue and discussion and making our case. We are hoping to persuade. We believe that a positive outcome from these meetings may make it unnecessary to pass any resolution at all. If at the end of this trip we go back with the message that there is sympathy, that there is likely to be 100 percent debt relief for Nigeria, why pass the resolution? The only resolution we will need to pass is to commend and thank our creditors for their support.
It is critical that we get debt relief now, because democracy must show appreciable dividends. One of the things that is reducing the impact of the things that we are doing as democrats is the issue of debt. We are diverting funds from essential services: the amount we are paying on debt is about three or four times what we are spending on education. It is thirteen times what we are spending on health. Unicef has statistics showing that 79,500 Nigerian children are dying every month before the age of five, mostly due to malnutrition and poor health services. It is a real challenge.
If these funds can be freed and directed to these needs, then it can help to bolster democracy. But the timing is critical, because in 2007 we are going to have elections. Then, our current president's term will be up and he is not running again. The transition from one president to the next is a very critical time. It is a time that we must make sure things work.
So, if we can get debt relief now, it will give us a year to a year-and-a-half for the proceeds to work into the system and produce visible results and show the success of democracy.
Does the National Assembly have specific plans for the money that would be saved if debt relief were granted?
Senator Udoma: It would be spent to relieve poverty, one of Nigeria's greatest challenges. That is where the money would go. Right now 70 percent of Nigerians live on less than a dollar a day. The per capita yearly income of Nigeria is about $300. The money will be devoted to health services, education, rural infrastructure, the water supply, and fighting HIV/Aids and malaria. We are willing to allow the IMF to monitor our spending. We've asked them to come and monitor us. We have an economic program called NEEDS [National Economic Empowerment and Development Strategy]. NEEDS really reflects everything I'm saying, and that is where the money will really be directed.
Some of your detractors question whether Nigeria deserves debt relief given its status as the largest oil exporter on the African continent? What do you tell those critics?
Senator Udoma: Nigeria may have oil but we are a very poor country. The total revenue from oil if you divide the price of a barrel of crude at $50 by the population of Nigeria, it adds up to not more than 50 cents per Nigerian. We have 130 million people. We're not like Kuwait, Iraq, or Saudi Arabia who have small populations and large oil revenues from crude oil. Our revenues from crude oil exports are the seventh largest in the world, so we are not really one of the biggest players in petroleum exports and our population is very large. We are a country that has a per capita income of about $300, where 70 percent of 130 million people live on less than one dollar a day. How can you describe us as a rich country? We're not a rich country.
Senator Osakwe: I think that the trip has been very successful so far, but the most important thing is that the people we've come to see gave us a hearing. They've listened to us and have been very sympathetic. It has changed their perception of what the whole problem is all about. It's not about the price of oil, it is about the populous, the Nigerians, the poor masses. It is about letting them know what the present Nigerian administration is doing, their effort at fighting corruption because corruption is the bane of most of this problem. The Nigeria of today is no longer the Nigeria of yesteryear. The present administration has done so much to cleanse Nigeria as a country, so that people can view us as friends, trusted friends. That has really eluded us over the years. The international community can do genuine business with Nigeria.
Even the debt itself was incurred in very dubious ways. As Senator Udoma pointed out, there are no guarantees that all this money actually reached the beneficiaries because there is very little or nothing on the ground to show for these debts. I have happened to visit some states and they can hardly show you one project where borrowed money was applied. The present Nigerian administration is just suffering from problems it never created. The military was an illegitimate regime that did not have the authority of the people. Today, we are suffering and our children will continue to suffer until something is done.
These messages have gone down well with every person we've seen. I have no doubt in my mind that the result will be very, very positive. Maybe they have heard about debt relief from the Nigerian executive, but now they are hearing it from the legislators. So now they feel that the matter is more serious. What we hope is that they will make it a priority, put it on the front burner of our discussions.
We also want to make it clear that Nigeria is playing in Africa the role that the United States is playing in the world. All the trouble spots - Sudan and West Africa - Nigeria is there. These things cost money, material and lives. That's why we are asking for this relief, so that this money we are spending on peacekeeping, on maintaining soldiers outside the confines of our territory, could be channeled towards improving lives of Nigerians. But the money is being spent on areas we didn't bargain for. If you send soldiers to Liberia, that's not in the annual budget. But when they are called, Nigeria will play that role, the role of godfather as the U.S. does. And all these efforts that Nigeria is making is saving the United States the pains, the money and the lives. So, you see that Nigeria is playing a very good role helping other states so that they can channel their resources to other areas.
You both mention corruption as a factor in Nigeria's debt burden. The anti-corruption fight has been a major focus of President Obasanjo's agenda since being elected in 1999 and recently several Ministers and influential people have been dismissed due to questionable activities. Some are now facing prosecution. How do you feel the fight against corruption is progressing, and where would you like to see more done?
Senator Udoma: I think it is difficult to talk about which way it is going. The issue is: if there is evidence of corruption, we will deal with it, high up, low down, wherever. The National Assembly has passed a number of laws against corruption. If we weren't happy we wouldn't have passed those laws. It is the National Assembly that set up the ICPC [Independent Corrupt Practices and other related offences Commission: http://www.icpcnigeria.com/]. We passed that law, and we made extensive changes to it to give it greater reach. It is also the National Assembly that passed the law that set up the Economic and Financial Crimes Commission [EFCC: http://www.efccnigeria.org/]. If we didn't support the fight against corruption, we wouldn't have passed that law either.
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The EFCC has received specific commendation at the recent United Nations Congress on Crime, which was convened in the Philippines. Beyond that, there has been an issue that has been a nuisance which is the advanced fee fraud - 419. In fact, what many people know of Nigeria are these letters. We are trying to fight this nuisance, and the EFCC has been at the forefront of the fight against this fraud. Funds that have actually been recovered and returned to their owners are due to the EFCC's efforts.
The ongoing National Political Reform Conference is about two-thirds of the way through its scheduled three-month session. Has the conference achieved or will it achieve what it was intended to do? There has also been discussion at the conference regarding a change in the presidential term, with proposals calling for a single six-year term in office. Why is a change necessary?
Senator Osakwe: The conference is the baby of the executive. It is welcomed because people have to talk, we people have to discuss their future. This has been going on for some time and you can see all shades of opinion have been given. So far, I think they have done well, because people who thought that they were going to be limited to discuss only things that they wanted to discuss, those people have been disappointed.
In the National Assembly, we could not talk about all the things they are addressing given the time constraints. I hope that my expectations for the conference are achieved, which are that Nigeria remains one and united and that a position is agreed upon that the National Assembly and Nigerians will support, that they come out with a position that gives every Nigerian a sense of belonging.
Senator Udoma: I was a member of the political reform agenda committee that recommended the National Dialogue - as it is called, not the National Conference. I support the Dialogue. The thing to emphasize is that the products of that dialogue will be recommendations for consideration by the National Assembly. When they come to us, we will look at those ideas. If they are good ideas, we will support them. If we think they may be unworkable, we'll discuss them in the National Assembly.
On the issue of the single six-year term, five-years or whatever, personally I have no problem with it. People are worried that this will be an excuse for the incumbent who has done two-terms as governors or as presidents to want to stay on. I don't think so, because even were this motion to be introduced as law, any sitting politician would be excluded from benefiting from it. So, I don't think it is something people should be concerned about. If they recommend a single six-year term, we will go back to our constituents to hear what they have to say about it. If they say it is a good idea, we will support it. But our support will not lead to an extension of any incumbent governors' or presidents' terms.
