Nigeria’s Oil And Law For What?

By

Mamman Lawan Yusufari

yusufaari@hotmail.com

 

 

A minor village market squabble led to the invitation of one of the parties, who happened to be wealthy, to the police station. To ‘enhance their bargaining position’, the police locked the man up, later unlocked him and demanded for a ‘bail fee’. His response was that his money should have shielded him from the cell filth and associated embarrassment. Having been subjected to them, he saw no sense in double jeopardy and therefore he declined. His philosophy is that wealth should be means to high objectives in life and certainly dignity is one of such objectives.

 

This philosophy is old. It is scriptural. And Aristotle had noted it when he said “wealth is evidently not the good we are seeking; for it is merely useful and for the sake of something else”. The philosophy is generally believed and that is why a rich, but self-depriving person, is often lambasted. Of what use is the wealth if it cannot fetch him at least basic human needs? Same perplexing question can be (and is in fact) extended to nations as artificial persons. Why should people in a rich country be saddled with the yoke of deprivations?

 

Nigeria is one such nation that must answer this question. Her paradox of needs in the midst of plenty is perennial. The country is oil-rich yet she grapples with the shackles of poverty, illiteracy, diseases, etc. The problem is not peculiar to Nigeria though. Popularly known as the ‘Dutch Disease’ or ‘Resource Curse’, it has been a thorn in the developmental flesh of the oil-rich Venezuela, Mexico, Algeria, etc. But it is more pronounced in Nigeria. Reason: she is the only oil-rich country featuring among the low- ranking countries in human development according to the UNDP Human Development Index 2005. And she ranked 158th out of 177 countries surveyed! She is not only on the same level with countries with no such fortune, others have outrun her.

 

General Gowon’s statement that Nigeria’s problem was not money but how to spend it could be said to be more valid today than when it was made in the 1970s. The opulence now is unprecedented in history. Yet decay stares us in the face with more effrontery. Looking back, one could say Nigeria is a “Garden of Eden in decay”. The evidence speaks for itself. The past is remembered with nostalgia, the present looks dim, and the future bleak. The certainty of tomorrow’s uncertainty makes today’s difficulty more difficult.

 

Ordinarily, resources should provide a springboard for human development. But Nigeria’s over $350 billion oil revenue since exploration in commercial quantity started has little to show for it. Save for few commendable efforts, Nigeria has not lived up to expectation as a nation. To the Niger Delta communities, oil has become a source of inter-communal conflicts, life-endangering environmental pollution, oil spillages, etc. And recently, oil has become a source of threat to the continued corporate existence of Nigeria. The threatening militants may not be self-sponsored, but the claim for a better life in the region cannot be dismissed as frivolous. Just recently, President Obasanjo admitted that governments have over the years failed the people of the region. Agreed. But what about people of other regions, Mr. President? People whose sufferings ironically increase by increase in the nation’s wealth? Do grants from oil revenue not reach their various governments? Can their miseries be justified?

 

Certain causes of this paradox have been identified: over-reliance on the oil sector for revenue generation; creation and influence of class interests; rent-seeking and consequent urban drift; corruption; mismanagement etc. Over 90% of Nigeria’s foreign exchange earning comes from the oil sector. Agriculture has suffered such that Nigeria has to import some foodstuff. ‘Easy’ money has not only created the class of the untouchables, but has left pursuit of ‘hard’ money to the ‘unprivileged’ ones. The village farmer would rather send money home from ‘where things happen’ than ‘wasting’ time in the farm. Usually, he ends up deluded, neither in farm nor ‘where things happen’.

 

Various governments have ‘tried’ to undo the paradox but to no avail. ‘Development’ ‘aid’ from UN, USAID, DFID and similar agencies seem to merely rub salt into the nagging wound. ‘Development’ projects by the transnational oil companies in discharge of the corporate social responsibility have been too inconsequential having regard to the pervading decay.  In search of a magic wand, solutions proffered and tried have been either politico-economic approaches or those tilting towards total ‘de-linking’. Gowon showered ‘Udoji’. Babangida adopted ‘chop-make-I-chop’. Abacha called the West’s bluff. And “Abachanjo” favours term elongation to consolidate “con-Soludo-tion”.

 

It is no exaggeration to say that most of the state governments (let alone local governments) will ‘close shops’ in less than six months of stoppage of the statutory grants (God forbid!). Even delays have thrown some states off balance. One wonders whether the oil money is as evaporative as the oil. With a focused vision and prudence, what accrued from oil over the bounty years ought to have taken us to the promised land. In other words, human development in Nigeria - measured mainly by level of poverty, rate of literacy, standard of health, etc. - is not commensurate with economic development - measured insufficiently by GNP per capita.

 

The oil wealth has not done well. What about the legal wealth? Could law be a possible cure for the Dutch Disease? The philosophy that material wealth should be instrumental is applicable to institutional and intellectual wealth as well. Modern states no longer limit the purpose of law to social control. Law provides an economic framework by protecting proprietary rights (through laws of crime, torts, contract, etc.) and facilitating commerce (through laws of partnership, company, investment, securities, etc.).

 

Law is also essential not only in creating a strong state, but also in checking the state’s abuse of power. It gives room for calculability and predictability. The consciousness of legal actors to the utility of law determines the substance, application and teaching of the law. Thus legislators, judges, lawyers, executive officers, law teachers and all other personnel of the legal system ought to be development-conscious in the discharge of their respective duties.  

 

How then have the sub-systems of the Nigerian legal system operated in the context of the oil-driven economy? Clearly, there are development-friendly legislation on the oil sector. The Petroleum Act for instance began by vesting entire ownership and control of all petroleum in, under or upon any land in the state. It also provides that only Nigerian citizens or companies incorporated in Nigeria may be granted rights to oil exploration licence, oil prospecting licence and oil mining licence. Other oil-related laws like the Petroleum (Drilling and Production) Regulations, Petroleum Profit Tax Act, Environmental Protection Act, Petroleum Technology Development Fund (PTDF) Act, Petroleum Trust Fund (PTF) Decree, Niger Delta Development Commission Act, etc. also have developmental effects on Nigeria.

 

The judiciary too has not been lax. Fresh in our memory is the decision of the Supreme Court making the federal government trustee of moneys in the Federation Account, hence accountable to the states and local governments as beneficiaries; limiting the application of the 13% derivation formula to onshore resource revenue only; declaring as unconstitutional the 1% allocation to the Federal Capital Territory from, and charging cost of Joint Venture Contracts and NNPC projects to, the Federation Account; etc.

 

Evidence abound that resource-endowed countries have centralized power structure. In particular, studies have linked political instability and bastardization of constitution in Nigeria to her oil wealth. In a courageous attempt to safeguard the constitution, the Supreme Court decided that the military coup of 1966 did not amount to a revolution and therefore the constitution was still the supreme law of the land. Law-makers can render ineffectual court decisions. The junta did so, unfortunately, having reacted swiftly by promulgating a decree to the contrary thereby giving itself a carte blanche.

 

Putting law into positive use is one challenging aspect of the lawyers’ work as social engineers holding ‘the balancing metaphor’. It is an essential aspect of development. It brings to the fore rule of law as an important doctrine for development. Here, Gani Fawehimi SAN has written his name on the sand of time. Among his many public interest cases, he caused a court to stop the office of the first lady from milking the state treasury in the name of ‘Better Life for Rural Women’. Gani’s activism is enviable.

 

However, it is one thing to have an oil-wealth-protecting legal regime and entirely another thing for it to ensure that the wealth trickles down. Has the law ensured distributive justice beyond inter-governmental level? Of course the law in books has done that. But what about law in action? How have the legislatures fared for instance? Clearly, their constitutional powers of impeachment for gross misconduct have rarely been exercised despite adequate evidences to support action. Indeed the Bayelsa Assembly did creditably well for firing Alam. But the fire was long overdue. And many of the ex-Governor’s peers ought to have suffered the same fate. The legislative lull is so great that despite the squandermania, we do not hear about investigations into executive affairs for the purpose of exposing corruption or waste in the disbursement or administration of funds appropriated by a legislature.  

 

The legislatures suffer confidence crisis. They are seen largely as a collection of selected self-serving puppets. However, the recent rejection of third term by the Senate has earned it a credit. But not for the resoluteness of the truly Distinguished Senators, the amendment could have sailed through. The oil wealth was both the end and means of the entire imbroglio: continued control over it was the obsession; and it financed the whole debacle. Law was an innocent conduit. It even suffered ‘desecration’ as law-makers assumed interpretive role: it was “alteration” of the constitution which required 2/3 majority by the provision of section 9(2); since the business was “amendment” of the constitution, a simple majority could suffice, some interpreted!

 

The judiciary too does not have a clean bill of health. It did not matter for a court to order for maintenance of status quo (over the Mantu Committee) and later to deny ordering stay of further proceedings. Perhaps the meanings of ‘order’ and ‘maintenance of status quo’ would have to be reconsidered in Nigeria’s legal lexicon. This approbation/reprobation was reminiscent of the June 12 crisis when the oil-fed untouchables made the judiciary a laughing stock by extracting from it contradictory and unenforceable orders. Again the judiciary’s complicity in suppressing social action movements in the Niger Delta is conspicuous. The ‘trial’, conviction and execution of Ken Saro-Wiwa and 8 other Ogoni people by the Ibrahim Auta tribunal is evidence. The judiciary is also the resort of the police whenever they trump up charges against labour leaders protesting against oil price hike or against any other person(s) who constitute ‘security risk’. In a way, courts have been made instruments of institutional violence.

 

The lawyers nko?! Courts not only work with lawyers but their decisions are heavily influenced by the lawyers’ casuistry. Behind almost every judicial oppression, there are bad egg lawyers. And the good ones do not engage in public interest litigation. The Ganis are in short supply in Nigeria. The inaction of lawyers in the face of the oil paradox may be rooted in the nature of their training. Legal education emphasises rule-learning for clientele services. Thus legal practice has been reduced to a crust-earning occupation rather than a nation-building profession. And save for the recent courts boycott over the alarming executive lawlessness, the Bar Association as a pressure group has been in a deep slumber.

 

The begrudging conclusion is that Nigerian law is itself infected with the Dutch Disease and is therefore incapable of curing it. The cure would necessarily have to be extra-legal. We may be blessed with a revolutionary leadership. Before then, common men must unite to fight the common enemy. But then, the energy to fight is constituted by the basic things to be fought for. How can a hungry and/or uneducated man fight for a right? Only time will tell how we get out of this catch-22 situation.

 

 

Mamman Lawan wrote in from the University of Warwick Law School, England.