TOPICS > Politics

Poverty and Crime Flourish in Oil-Rich Niger Delta

BY Admin  July 27, 2007 at 12:05 PM EST

Oil field explosion

President Umaru Yar’Adua vowed at his inauguration in May to crackdown on unrest in the region, but tense labor disputes and high profile crimes, including the kidnapping of a 3-year-old British girl for two days, show no signs of decline.

The Niger Delta, a massive and densely populated area of tropical rain forest and swamps located on the southern coast of the country, has always been an important center for natural resource extraction, but has become one of the most economically and strategically important territories in Africa since the discovery of oil there in the 1950s.

Regional experts point to the oil boom itself as a cause of much of the violence and instability in the region. Rather than stimulating economic and social growth in the Niger Delta, the massive revenue generated by oil extraction has acted as a magnet for corruption.

Billions of dollars in revenue are simply disappearing in the distribution process, said Sebastian Spio-Garbrah, an Africa analyst for the Eurasia Group.

“The Niger Delta receives more money per capita than anywhere else in Nigeria,” said Spio-Garbrah. “The problem is that this money has then been mostly siphoned off, misspent and abused.”

In accordance with provisions in Nigeria’s 1999 Constitution, the federal government must allocate a minimum of 13 percent of the revenue from contracts with foreign exploration corporations back to the oil-producing states.

In theory, this revenue is then spent by state and local officials on projects and initiatives for the benefit of the region’s population. In practice, however, corruption is endemic and the economic benefit for residents of the Niger Delta is negligible.

The lucrative oil industry has also created more indirect problems for the region and been a burden on the local society, according to Folabi Olagbaju, a Nigerian native and a specialist on the region for Amnesty International.

“Oil exploration has not led to social and economic development for the peoples in the oil-producing states. It has benefited the Nigerian ruling class,” said Olagbaju. “It has also led to dependence on that part of the country for a single export resource and has discouraged the development of other areas of the economy including agriculture.”

Pointing to what economists call a “resource curse” phenomenon, Olagbaju and others say the oil boom has pressured the Niger Delta into an unhealthy reliance on an industry that promotes little long-term growth, while skewing investment away from sustainable economic production and causing catastrophic ecological damage.

The result is an area roughly the size of West Virginia that produces about 800 million barrels of petroleum a year, accounts for over 85 percent of the nation’s export revenue, and yet is inhabited by a population living in abject poverty.

Traditional local industries like fishing and agriculture are increasingly squeezed out, and the local government offers neither a share of the profits nor financial redress for the related environmental damage.

Increasingly, the people of the Niger Delta must turn to political or criminal violence in response to these pressures, according to political scientist Rotimi Suberu of Nigeria’s University of Ibadan.

“The oil boom has created extreme inequality that reaps the kind of conflicts you have there. It acts to repress or preempt any kind of economic activity other than the oil industry … and many resort to criminality in order to get their share in a way,” Suberu said.

Olagbaju views the lawlessness in the Niger Delta as symptomatic of a breakdown of the social contract in a region where the government has often been accused of criminality.

“The rash of violence and kidnappings must be seen in the context of the impunity [of violence] which has reigned in the Niger Delta for over the past decade of so,” he said. “Human rights abuses are rarely investigated, when investigated are not made public, perpetrators are rarely brought to justice, and the federal government seems incapable of reining in regional militia groups.

“Violence and kidnappings are desperate acts of desperate people who have completely lost all sense of hope for a better life in the country.”

There remains some indication, however, that the region will improve. The election last spring was accompanied by a clamoring for more transparency and less corruption in the distribution of oil revenues. The desire to make good on promises of reform to the international community, coupled with the understanding that anarchy in the Niger Delta is ultimately bad for business, may prove strong enough to trigger some changes.

“My sense is that the government knows that they are facing a major crisis,” said Suberu. “They have to respond, and they are attempting to respond. There is some hope that this current administration will address the crisis in the Niger Delta more positively.”