Nigeria is ironically the fourth largest oil exporter to the United States. It has vast resources yet it suffers from extreme poverty. It has been receiving foreign aid from the United States, the World Bank and the International Monetary Fund. But it remains poor and badly governed. Studies show that the purpose of the aids has been defeated and even made the national situation worse. The continuation of foreign aid is not seen as helpful or desirable.
Foreign Aid Effects on Nigeria
AN HONEST ASSESSMENT
Effects of Foreign Aid Use in Nigeria
Nigeria or the Federal Republic of Nigeria is located in West Africa on the Gulf of Guinea and lies between Benin and Cameron (LOC 2008). As of the latest count, it has a population of 138 million at an annual growth rate of 2.38%. Nigeria is the fourth largest exporter of oil to the United States. Yet in the face of vast natural fossil fuel reserves, it suffers from extreme personal poverty for 57% of its people. Economists describe this as a "paradox of plenty" or the "curse of oil." Nigeria, like other developing countries in similar situations, is provided foreign aid to help promote democracy and economic stability. Foreign assistance attempts to deliver these countries' people from poverty, and provide security, military assistance and counter-terrorism measures. Of the countries outside Western Europe, Canada and Australia, Nigeria is the 10th of the top 10 recipients of foreign aid from the United States at $614.7M, as of 2010 (LOC). .
Nigeria received assistance also from the World Bank in the form of 23 active projects with a committed value of U.S.$2.67 billion in August 2007 (LOC 2008). It received 123 other projects since it joined the World Bank in 1961. And the International Monetary Fund approved what is called a two-year policy support instrument to encourage the growth of the non-oil sector and for poverty reduction in October 2005. Upon review of the program in March 2008, the IMF found that Nigeria had achieved macroeconomic progress, an 8.5% average non-oil sector growth and reduced inflation at roughly 6%. But it also noted that, despite these improvements, the majority of families remained very poor (LOC).
Impact in the Case of Nepad Chukwuka 2013)
Two issues characterized the negotiation process between Nigeria and the international or multilateral aid agencies (Chukwuka 2013). One was that these negotiations were conducted in secret rather than publicly. Another was that resulting agreements were never made public until after 25 years or more have lapsed. Nigerian critics know very little about the process. Often, these negotiations lead to increased unemployment, double-digit inflation, interruption of domestic capital accumulation, collapse of productive processes, and broadening income inequality. One instance is the protest filed by the former Governor of Kaduna State against the World Bank food production loan program. One of the terms required World Bank officials to manage the program. The former governor asserted that the surrender of the management of the program directly affects the lives and future of millions of Nigerian peasants. This would be in the interest of the country. Another example was the insistence of the World Bank that consultants should be foreigners who will make sure that all the terms of the agreement would be fulfilled and implemented. Nigerians feel that international aid agencies are the actual decision-makers on who gets what, when and how. Jerry Gana of Alhmadu Bello University described one program as World Bank-directed rather than World Bank-assisted. Nigerians generally believe that the World Bank and other multilateral ad agencies dictate rather than negotiate with or assist governments (Chukwuka).
Actions of Nigerian Leaders
Corruption heads the list of reasons for the failure of the objectives of foreign aid. One illustration is provided by the Chairman of the Economic and Financial Crimes Commission Nuhu Ribadu who accused former leaders of stealing donors' assistance from Western countries worth $500 billion since the country gained independence (Ojeme & Ezinwa 2006). The money was intended for development projects in the country. Ribadu warned that unless this situation is promptly addressed and solved, the country could descend into deeper economic deterioration not too far from now. He elaborated that corruption is the biggest hindrance to national development. He added that that corruption reaching this level will stunt and destroy a thriving state similar to the Democratic Republic of Congo. Other similar cases are Sudan, Liberia and Sierra Leone where the state virtually failed and collapsed (Ojeme & Ezinwa).
Ribadu also said that the megalithic kleptocary of previous leaders pushed many Nigerians to leave the country in order to escape the deplorable condition (Ojeme & Ezinwa 2006). He rallied Nigerians behind the war against corruption by government leaders through people's participation in it and in support of an anti-corruption campaign. Moreover, Chief of Staff to the chairman of the Economic and Financial Crimes Commission Dapo Olorunyomi made his own revelation of corruption in leadership. He revealed that leaders who held the nation's money between 1960 and 2005 stole an additional $20 trillion. The amount was exhumed from the records of the United Nations Development Program. Olorunyomi said that this amount was six times the amount needed to rebuild Europe after World War II. It was ironic that when 100 billion was stolen in the year 2000, the country's external debt was $33 billion, which could have been paid (Ojeme & Ezinwa).
Olorunyomi points to poor governance as the central problem (Ojeme & Ezinwa 2006). He described those previous government leaders as looters who did not care for the people for whom the money was intended to buy basic amenities for. Like Ribadu, he rallied Nigerians to become conscious of their responsibilities. He urged the public to spread the new awareness and drive against economic crimes in their country (Ojeme & Ezinwa).
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