Nigerian military safeguards its future


By Norm Dixon

Nigeria's corrupt military and business elite has been busy safeguarding its future, even though it succeeded in placing its favoured candidate, former military dictator Olusegun Obasanjo, in the president's post at the February 27 election. In a race against time, senior military figures have moved to entrench their influence in the country's political and business affairs prior to the May 29 handover to civilian rule.

Nigeria's ruling class is dominated by fabulously rich serving and former military officers and their business cronies, mainly from the Hausa-Fulani people of the north, whose wealth has been accumulated from decades of corruption, kickbacks and embezzlement of the country's annual US$12 billion oil revenue.

Recent shenanigans indicate that the elite is not about to relinquish this lucrative source of loot.

Obasanjo's presidential campaign was openly supported and bankrolled by "retired" army generals and former dictators, wealthy businesspeople and prominent politicians. The key backer of Obasanjo was the powerful military faction led by former dictator General Ibrahim Babangida, who ruled with an iron fist between 1983 and 1993. During the campaign, Obasanjo went out of his way to reassure the military elite that it would be safe from retribution.

However, the military elite was not content with simple reassurances. In early March, the Provisional Ruling Council (PRC) secretly parcelled out — without tender — 11 potentially oil-rich offshore exploration leases to "indigenous entrepreneurs", meaning companies linked to top military figures and their cronies.

The leases are near areas where US and European multinational oil companies Texaco, Shell, Statoil and Agip have recently discovered oilfields containing several hundred million barrels.

The May 3 and 10 editions of the Lagos News reported that the beneficiaries of the regime's largesse were "virtual oil companies" linked to the "glitterati of the military-business circles", including the chief of general staff and the country's second-most powerful military leader, Admiral Mike Akhigbe, chief of defence staff Air Marshal Al-Amin Daggash, chief of army staff General Ishaya Bamaiyi, and other senior officers and diplomats.

Nigerian dictator General Abubakar's son-in-law's father is chairperson of one of the companies, which also has as a director president-elect Obasanjo's People's Democratic Party's economics adviser. Not to be left out, Obasanjo's mentor, General Babangida, also bagged a lease via his Heritage Oil and Gas company.

Admiral Akhigbe is emerging as the Nigerian military's most high-profile protector of its political and business interests. According to the News, Akhigbe has a vast business empire that includes oil, property, construction and telecommunications.

Akhigbe was in charge of staging the recent world youth soccer championship. He personally decided which contractors were used to build the necessary facilities as well as being in control of all expenditure. Overall, more than 19 billion naira (US$19 million) was spent on the tournament, much of which, many Nigerians suspect, ended up either directly or indirectly in the bank accounts of Akhigbe's companies.

Akhigbe also heads the PRC's National Council on Privatisation, established to speed up the sell-off of state assets. On February 5, the PRC announced that it was interviewing potential "strategic investors" interested in buying state assets that include telecommunications utilities, power plants, the National Fertiliser Company, a paper plant and a sugar factory.

Rather than wait for the incoming government to take control of the privatisation process, the PRC passed a decree on April 23 that ensures military-picked officials have a large say in privatisation decisions. "The reason is not far-fetched. [Akhigbe] and a number of others in the outgoing regime want to corner juicy shares using fronts in a number of the companies to be privatised", a government source admitted to the May 3 Lagos News.

Western governments and financial institutions have not bothered to insist on democratic niceties. They have maintained pressure on the military regime to commit itself to strict economic measures, including increasing the pace of privatisation, before it will allow relief of Nigeria's massive $29 billion external debt. The military regime signed an agreement with the International Monetary Fund to this effect in January. Obasanjo government will be tied to these agreements.

On May 1, Britain's chancellor of the exchequer, Gordon Brown, sent a letter to Nigeria's current finance minister demanding that the new civilian government accept permanent IMF monitors in the finance ministry and central bank, and allow independent audits of the bank and state-owned oil company before Britain will back debt relief or new loans.

In a last minute splurge, the PRC in April approved a list of "emergency" projects worth N60 billion, including an aluminium project, a radar system and road-building and construction projects. In the first three months of 1999, the budget deficit grew to N60 billion — twice the deficit budgeted for the entire year — and is on track to reach N200 billion by year-end.

Nigeria's foreign reserves in that period dropped from US$7 billion to under $3 billion. It is widely believed that much of this money is being funnelled through shonky military-linked enterprises to the elite's Swiss bank accounts. The PRC said on May 5 that proceeds of privatisation would be used to finance the deficit.

The military has also moved to ensure that the civilian government cannot fundamentally change the political system. On May 5, General Abubakar signed into law a new constitution. It was drawn up behind closed doors by a military-appointed committee. Its provisions remain secret and will not be made public until May 28 — just one day before the civilian government takes the reins.

It is tipped that the constitution will limit the government's control over the military and also prevent legal action being taken against military officers guilty of human rights abuses and corruption.