Non-Market Strategy Project Pollution Politics Business Research Paper

  • Length: 12 pages
  • Subject: Economics
  • Type: Research Paper
  • Paper: #96951798

Excerpt from Research Paper :

Non-Market Strategy Project-Pollution/Politics/Business

Globalization has changed the planet in numerous ways, constructive and unconstructive; perhaps the most influential of these changes has been the more explicit and perhaps a far more extreme commoditization of a number of natural resources and basic human demands. Traditionally, it's the limited nature of a specific resource or product that means it is a saleable resource, and this conclusion leads to the decision on its sales price as well as the marketing strategies needed to introduce it to a specific target market and varying resulting in the creation of opportunities to make profitable returns for the organizations and countries involved in its manufacture; but that is the case when generally speaking and not, however, the specific problem in Nigeria. The emphasis placed on the energy and power industry from the early stages of the 20th century has resulted in a substantial number of countries, for example Saudi Arabia, advancing globally far more rapidly compared to the overall potential growth percentage expected; simultaneously, on the other hand, this focus has been the initiation of a major 'resource curse' for numerous countries -- a curse that has primarily been the cause of a worsened and weakened economic structure.

A good example of this was the study conducted by two Harvard professors, Sachs and Warner, back in 1995 when they highlighted that the economic performance worsens as the dependence on a single natural resource increases (Sachs and Warner, 1995). They asserted that the situation with every economy depending on a single natural resource could not be controlled or enhanced by trying the better manage peripheral aspects of the economy like income, investments (local and foreign), per capita output, amongst others as the real negative effects usually surfaced irrespective. In their study they took an approach to study the disadvantages that usually surface (and the reason behind these disadvantages) between the countries on designing the trade policies and the government efficacy once the country was dependent upon a single resource (Sachs and Warner, 1995).

Sachs and Warner (1995) further asserted that a natural resource must be regarded as a commodity that will assist in developing the country via a few designated and monitored channels, for example job opportunities, increased exports and so on, although it must not be used as a solitary channel for accumulating the nation's wealth as that approach will most likely backfire (Sachs and Warner, 1995). Case in point is the Nigerian economy, which back in the early 1980s had an extremely harmonized and balanced approach towards trade and finance that had created a strong and positive balance of payment for the nation and given the locals numerous opportunities for national and international growth. The economy's global strength can be estimated from its currency standing as one British pound at the time was equated to one Nigerian naira. The tables turned, though, since the use and export of oil became the single dependent natural resource in the region. The problem then expanded as the export of oil became the primary trade and all other prior export like those of tin, iron ore, cocoa amongst others were given less attention and had minimal capital allocation. The reason behind this shift was because of the fact that the revenue generated from this particular approach was deemed greater than the others -- the government believed that the enormous foreign investments and exchange inflow was the start of a brand new dawn, one which would last for a long time. This then resulted in the promotion of activities like that of embezzlement and corruption amongst the administrative authorities along with other issues for the national economy. The end result now is that the global currency ration is that one British pound is equated to 200 naira exhibiting the imbalance economy and negating balance of payment ratios (xe, 2011).

Whatever percentage resulted from the vast wealth produced by petroleum, the overall benefits have been minimal and non-existent when we look at the growth opportunities of the population. The Nigerian population is one who has had to deal with extreme economic and social pressures from the 1960s and have been forced to forego their traditional agricultural structures as they are no more feasible in an oil-driven economic mindset. The decline of the Nigerian economy is apparent when one analyzes their decline in agricultural produce; to start off, the overall production of both the cash crops as well as the food crops dropped significantly in the late 20th century; furthermore, numerous other resources like cocoa, which Nigeria produced at the highest percentage globally, declined an astonishing 43%; similarly, the produce of resources like rubber decline 29%, groundnuts decreased 69% and cotton manufacture decreased a whopping 65% as well (Okonta and Douglas, 2001)

Background of the problem

Royal Dutch Shell Plc (Shell) initiated their oil drilling operations in Nigeria's Niger-Delta region back in the year 1958 and has furthermore worked with the Nigerian government to create Nigeria's global standing as one of the more prominent oil producing countries on the planet. However, this caused a sizable proportion of Niger delta inhabitants to get rid of their land, which was a primary income source for them back in the 1960s. A teacher from the region of Ogony, Sam Badilo Bako, specifically Taabaa, sent Shell a letter in which he pleaded the case of the local and stated that they locals are in need of education and employment with demand of minimal basic needs like food and shelter. He also asserted that the local did not want their kids to stay out of school or have their families suffer financially because Shell had removed land, which was previously their main supply of revenue. In a nutshell, he said that the locals did not wish to reside in a vicious circle by which they will perceive Shell-BP as the cause for their problems and oppression. He even stated that he felt it was ironic that the people who are the rightful owners of the wealth owned by their country are the ones facing extreme poverty and economic strain (Amunwa, 2011). This was perhaps the first of many records where the locals tried to reason with the Shell Corporation, clarifying their standing on the presence and activities of the corporation as well as clearly identifying their problems.

This was not the extent of the worries for the locals however as nearly four decades later, this case escalated to much worsened state with recurring incidents of escalated pollution, gas emissions and flares as well as overall ecological degradation of the Niger Delta particularly and Nigeria as a whole. The negative environmental ramifications of this region has simultaneously resulted in the creation of vast for Shell, the stakeholder as well as the corrupted officials in the Nigerian government while significant number of the Niger delta inhabitants have already been deprived of the livelihood and use of clean water (Amunwa, 2011).

Among the first activists to speak out due to this widespread imbalance was businessman, writer and activist Ken Saro-Wiwa. He belonged to the Ogoni region which was a region suffering the same fate as many suburbs outside the oil capital Port Harcourt. Saro-Wiwa was primarily a promoter of non-violent negotiations to help the Nigerians have a stake in the overall profits made by the government. However, the Nigerian military government at the time falsely charged him with fabricating the murder of four Ogoni elders and hanged him thereafter in 1995 along with 8 other non-violent activists who worked with him. Regardless of the democratic government that followed, there are still many unfulfilled promises made to enhance the lives of Delta dwellers (Robinson, 2006).

The worst aspect that has been created due to this rising corruption has been its impact on the lifestyle of the locals who have now been reacting violently, after years of attempting peaceful dialogue with the government. This violent reaction through the activists in Nigeria is the policy issue that will be discussed in this paper.

Phases and Impacts

The continuing deprived conditions of the local and peaceful dialogues resulting in little to no penetration wither Shell or the government; the Nigerian society experienced an increase of violent activists at the beginning of the 21st century particularly in the years 2006 through 2008. These activist groups were formed as retaliation towards the unjust operations, exploitations, ethical inconsistency of Shell with the dishonesty and corruption of the Nigerian government and aimed to instigate both these institutions to acceptably and appropriately cope with the problems that the generations had faced before this era. Even though, the problem of imbalance and unjust exploitation was long recognized before the start of the 20th century by the non-violent activists who continued to work endlessly, most memorably throughout1995), the fact of the matter is that the Shell Corporation and all its activities are backed by the Nigerian government who is the backbone shielding them from any real accountability for their actions for an extended period of time even before the need for the…

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