“reforming the rentier state: the challenges of governance reforms in nigeria,” by paul g....

8/7/2019 Reforming the Rentier State: The Challenges of Governance Reforms in Nigeria, by Paul G. Adogamhe

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THE JOURNAL OF ENERGY

AND DEVELOPMENT

Paul G. Adogamhe,

Reforming the Rentier State:

The Challenges of Governance Reform in Nigeria,

Volume 34, Number 2

Copyright 2011


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REFORMING THE RENTIER STATE: THE

CHALLENGES OF GOVERNANCE

REFORMS IN NIGERIA

Paul G. Adogamhe*

Introduction

Nigeria has abundant mineral resources with crude oil exports alone accountingfor 95 percent of the nations foreign-exchange earnings. The federal govern-ment bureaucracy has expanded significantly to meet the increasing federal gov-

ernment intervention in the economy. The share of the governments participation in

the economy has grown significantly, with consolidated expenditures rising from 29

percent of the gross domestic product (GDP) in 1997 to 50 percent in 2001.1 When

Nigeria gained its independence in 1960, the federal bureaucracy consisted of 72,000

employees; 40 years later (2000), this bureaucracy has increased to a work force of

1.2 million, consisting of 26 ministries and about 400 extra-ministerial departments.2

The federal government bureaucracy is now the chief employer in Nigeria, bogging

down the budget with recurrent expenditures on bureaucratic structures and per-

sonnel salaries. Consequently, the federal government capital project expenditures on

health care, education, communication networks, and social security suffer financial

insolvency. In an era of capitalistic democracy, Nigeria finds itself held hostage by

big government, corruption, and poor governance.

*Paul G. Adogamhe is currently an Associate Professor of Political Science in the Department of

Political Science at the University of Wisconsin-Whitewater. He holds M. Phil/Ph.D. degrees in

international relations from the Graduate Center of the City University of New York; his doctoral

dissertation was on Nigeria/OPEC relations. The author also earned a M.A. degree in international

political economy and development from Fordham University. His articles have been published in

The Nigerian Journal of International Affairs (NJIA), African Integration Review, Poverty and

Public Policy, Journal of Development Alternatives and Area Studies, among others.

The Journal of Energy and Development, Vol. 34, Nos. 1 and 2

Copyright 2011 by the International Research Center for Energy and Economic Development(ICEED). All rights reserved.

227


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The independence of the Public Service Commission, which is supposed to

insulate the public service from politics and to maintain neutrality and objectivity

in the activities of the civil service, was compromised through undue political

interference. The result has been the appointment or promotion of staff with in-

appropriate qualifications for the job in the public service system. The affirmativeaction policy of maintaining the federal character in the Nigerian civil service

has introduced ethnic considerations in the appointment and promotion of civil

servants to senior management positions in government agencies. The negative

consequence of this political interference is that it has led, in some cases, to the

appointment of incompetent and mediocre staff to senior management positions in

the name of maintaining ethnic balance. This results in the inability of staff to

carry out the duties of their positions, which has affected the quality of perfor-

mance and the delivery of services to the people. At his inauguration in 1999,

President Obasanjo advocated for public service reforms:

Our public offices have too long been showcases for the combined evils of inefficiency and

corruption, whilst being impediments to effective implementation of government policies,

Nigerians deserve better. And we will ensure they get what is better.3

Therefore, one of the priorities of President Obasanjos administration was to

embark on a series of reforms to reinvigorate and streamline this unwieldy federal

bureaucracy and to make it more responsive, efficient, and cost-effective. In 2004,

President Obasanjo formally launched the reform manifesto entitled the NationalEconomic Empowerment and Development Strategy (NEEDS). The series of

political and economic reform initiatives were conceived as a medium-term

blueprint for dealing with the structural and institutional dimensions of Nigerias

developmental crisis from 2004-2007. This paper is an attempt to examine the

proposed reforms vis-a-vis the rentier status of Nigeria.

Nigeria: A Classic Rentier State

H. Beblawi identifies four essential characteristics that would determine a rentierstate: (1) if rent situations predominate; (2) if the economy relies on a substantial

external rent and, therefore, does not require a strong domestic productive sector; (3)

if only a small proportion of the working population is actually involved in the

generation of the rent; and, perhaps most importantly, (4) that the states government

is the principal recipient of the external rent.4 Nowhere are all these characteristics

associated with a rentier state as clearly manifested as in Nigeria, a fact that has

complicated the economic and administrative reforms championed by the Nigerian

government.5 As A. Harneit-Sievers correctly observes,

. . . a rentier state is a state whose major source of revenue does not arise from taxation on

productive activitiesagriculture, industry, servicesundertaken by its economically active

THE JOURNAL OF ENERGY AND DEVELOPMENT228


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population. Instead, the rentier state lives by collecting a convenient income from sources into

which it invests little or nothing. Rent comes in without opportunity costs, and if it comes in as

centralized as in the case of oil, it is even more convenient, from the treasurys point of view.

Nigeria is a drastic caseperhaps the most drastic among the populous nations of the

worldof a rent-based economy and it has suffered heavily from it.6

The emerging paradigm of rentier political ecology places emphasis on the rentier

space, which tends to deal exclusively with activities related to the acquisition,

control, disposition of oil and oil-related resources, including the financial benefits

derived from them, with the rentier state serving as the epicenter of coveted space.7

The economic behavior of a rentier state, according to D. Yates, embodies a break

in the work-reward causation. . . . [r]ewards of income and wealth for the rentierdo not

come as result of work but rather are the result of chance or situation.8 During the time

of an oil boom, the government has windfall profits that can lead to massive spending

schemes, including for nonproductive investments, and that can promote corrupt

practices, in turn undermining transparency and accountability in the public sector.9

This social epidemic of the rentier state also involves a widespread behavior and often

a mentality among the population. For example, most Nigerian citizens tend to see the

oil revenue that pours into state coffers as something of a dichotomyit is everyones

and no onesso individuals clamor for a share of the national cake rather than earn

an income largely generated through employment. With this weakening of the re-

lationship between effort and reward, the federal government of Nigeria is perceived as

a revenue distributive organ of the rentier state. This situation is described by T. L. Karl:Because petrodollars are not their money, citizens are not motivated to ensure that state

revenues are well spent; they are not engaged; and they seldom demand better monitoring of

the utilization of revenues. Like their rulers, they too often become addicted to their share of

oil rents even as a type of permanent disconnect between the state and its subjects sets in.10

H. Mahdavy, who first popularized the concept of the rentier state, argues that

resource rents make state officials both myopic and risk-averse: upon receiving

large windfalls from oil, the government grows irrationally optimistic about future

revenues and devotes the greater part of the resources to jealously guarding thestatus quo instead of promoting long-term development.11 The rentier states tend

to promote weak political and economic development and, instead of creating an

efficient and responsive public sector, they create a corrupt and irresponsible

one.12 More specifically, these states fail

to develop a robust central bureaucracy because their ability to rely on external revenue source

engenders rigid and myopic decision-making. This includes. . . the failure to build a viable tax

regime because they do not feel compelled to extract revenue from domestic sources to fill

their coffers.13

For instance, available statistics indicate that the federal government of Nigeria

in the last ten years (1999-2009) generated about the sum of 34 trillion naira in

REFORMING THE RENTIER STATE: NIGERIA 229


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revenue. Proceeds from taxes accounted for 17 trillion naira. However, much of

this amount was proceeds from oil taxes because nonoil tax proceeds contributed

as little as 3 trillion naira during the period under review.14 This has presented

a difficult situation for the governments plan to de-emphasize the over-

dependence on oil revenue to fund the budget. The dependence on external rentnot only frees the state from the need to extract taxes from the domestic economy

for wealth creation but also unwittingly diminishes its own administrative ca-

pacity.15 According to Hilary Benn, the tax system is crucial for accountability. . . .when citizens pay tax, they demand services back.16 Taxation can become

a powerful incentive for the Nigerians to demand accountability from the federal

government. If domestic tax proceeds are not channeled to the provision of the

public good, the Nigerian taxpayers are most likely to resist the federal govern-

ments efforts to impose taxes. The fact that the federal government is less likely

to rely on their citizens for financial support has resulted in weak linkages between

the government and citizens. When citizens are untaxed they sometimes have less

information about state activities and the public, in turn, is less likely to demand

government accountability.17

Fluctuations in the oil market prices often create macroeconomic instability

and, as a result, the government is plagued with inconsistent policies and service

deliveries due to budgetary shortfalls. The federal governments budget is almost

entirely based on rentier income, causing Nigerias economic and political de-

velopment to be held hostage to the volatility of the worlds oil markets. It makesa pretense of federal government budgetary debate. The Nigerian oil industry, like

that in virtually all major oil-exporters, is not labor-intensive. Therefore, it em-

ploys only a few unskilled workers since Nigerian technology is far behind the

industrialized countries. As a result, the oil industry, which accounts for at least 80

percent of the Nigerian GDP, is also responsible in part for high rates of un-

employment in Nigeria. Thus, the Nigerian working population consists mainly of

foreigners employed in the oil industry and the civil servants who work for the

federal and state governments. The rest of the Nigerian population, which is able

to work, largely remains either underemployed or unemployed. The oil industryhas consumed the cottage industries (such as groundnut pyramids, cotton, hide and

skins, rubber, cocoa, and palm oil industries) that once bankrolled the Nigerian

economy in the early 1960s. These cottage industries were owned and managed by

Nigerians in the private sector rather than by the federal government.

Thus, despite record-high oil prices and unprecedented inflows of oil revenues,

Nigeria is rated as among the 15 poorest countries in the world.18 The military

dictators mortgaged Nigerian oil as collateral for borrowing billions of dollars

from foreign banks at exorbitant interest rates. Until recently, the Nigerian na-

tional debt stood at $35 billion. The problems of excruciating poverty, ecologicaldegradation, and underdevelopment have contributed to violent resource-based,

religious, and ethnic conflicts throughout the country.19 Thus, the disruptive



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violence prevalent in many parts of Nigeria has diminished the governments

capacity to govern the country effectively.

GDP per capita is $400 per year, 60 percent of the population lives on the less than $2 per day,

78 out of every 1,000 infants dies at birth, 35 percent of the population under five years of ageis malnourished, barely 50 percent of the adult female population is literate and so on . . . . The

record is dismal, yet over the past 35 years, oil rents accruing to Nigeria have amounted to an

estimated $300 billion. Nigeria, however, is not unique. Its experience is replicated

throughout African oil-producing countries and in other regions of the world where there is

similar dependence on oil and gas.20

While the institutional overhang of the rentier state continues to serve the in-

terest of ruling elites and oil multinationals, rentier money continues to impede the

type of reform policies that would lead to the better governance and effectiveness

of the Nigerian state.21

Therefore, Nigeria must transform from its rentier status todeal with the crisis of economic stagnation as well as achieving a level of effective

public governance. Some of the recent scholarly literature also have shown evi-

dence that the quality of a countrys institutions and governance structures can

explain variances in economic outcomes across natural-resource-abundant coun-

tries.22 The issues of fiscal federalism, for instance, are at the forefront of many

socioeconomic and political challenges in Nigeria, including matters of service

delivery, accountability, macroeconomic stability, balanced growth, and the

strengthening of its fledgling democracy in general. The practice of true fiscal

federalism therefore would create a legal, political, and economic environmentrequired to restore professional ethos and integrity that will ensure both the ef-

fectiveness of the public service as well as the legitimacy of the Nigerian state.

The Governance Reforms in Nigeria

The proposed agenda for reform in Nigeria are:

to right-size the economy and eliminate ghost workers, and re-professionalize the public

service, rationalize, re-structure and strengthen institutions, privatization and liberalization

program, tackling corruption, and improving transparency in government accounts, reduce

waste and improve efficiency of government expenditure.23

The government also established several anti-corruption agencies including the

Independent Corrupt Practices and Related Offences Commission, the Economic

and Financial Crimes Commission (EFCC), the Cyber-Crime Commission, and

the Code of Conduct Bureau. These agencies have the power to investigate alle-

gations of corruption against public officials and bring charges against them. Thishas sometimes led to the arrest, prosecution, and conviction or dismissal of highly

placed public officials who abused their offices.



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The federal government has introduced a series of reforms to achieve a bal-

anced budget, transparency in accounting for oil revenue, public procurement, and

contract awards.24 The government adopted the 2004 oil-price-based fiscal rule,

a fiscal framework that delinks oil revenue flows from government expenditure

and thus helps to protect macroeconomic stability. The Fiscal Responsibility Actto achieve fiscal discipline finally was passed and signed into law in 2007. Further,

the reform program has emphasized the need for resource enhancement through

greater prudence and efficiency in the use of public funds, a freeze of payments on

extra-budgetary commitments, reduction and elimination of waste in the system,

and greater efficiency in the collection of government revenue. Some of the other

innovations in the management style proposed by the reform include: (1) the es-

tablishment of an independent monitoring framework that will involve a broad

spectrum of stakeholders; (2) the establishment of a Peer Review Mechanism that

will provide an avenue for former heads of government of the federation to review

progress and problems, and learn from the experiences of one another; and, (3)

special focus is also being placed on the need to gather adequate statistics and

strengthen analytical work as key instruments for assisting the government in

monitoring and evaluating projects.

Budgetary and public financial management processes and systems have been

reformed, which has impacted positively on some aspects of funds management. The

procedure for awarding contracts has been redesigned to conform to international

standards and practices, with emphasis on transparency, competition, and value formoney. The oversight role of the Due Process Office has been formally established in

the Bureau of Public Procurement, following the passage of the 2007 Public Pro-

curement Act. The Public Procurement Act was put in place to guarantee fair play in

the award of government contracts. For this reason, specially trained procurement

cadres have been entrusted with the responsibility of handling government contracts

to ensure the efficient implementation of the Public Procurement Act. An efficient

procurement system is a vital instrument for expenditure management, which will

ultimately lead to an effective delivery of public services, promoting economic

growth, and development.25

There has been some improvement in the areas of publicrecurrent expenditure management, government procurement, and the accounting

system, thus curtailing some of the waste in the public service.26

Nigeria has successfully enacted into law the Nigerian Extractive Industries

Transparency Initiative (NEITI) bill in May 2007. NEITI was derived from

Nigerias participation in the international reform effort known as the Extractive

Industries Transparency Initiative (EITI), which is to enhance transparency and

accountability in the oil and gas industry. When NEITI was passed by the Nigerian

Assembly it became the first EITI-implementing country with a statutory backing

for implementing EITI in the world. The government also has made efforts tocollaborate with civil society organizations and other stakeholders by initiating

efforts that will bring them into consultations on budgetary matters. However, this



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practice has yet to take firm root in Nigeria as there are many instances where

these stakeholders were not consulted or their views were not taken into account in

policy formulation. Nigeria paid its $30 billion external bilateral debt owed to the

Paris Club of official creditors in April 2006.27 It also has exited its London Club

obligations and, as of mid-June 2007, Nigerias external debts stood at about 3 percent of GDP, most of this being multilateral debt. This, in turn, has had

a beneficial impact on investment and economic growth in Nigeria.

The Nigerian Public Service Reform Program

The highlight of the reform agenda was to create

a public service that is performance and result-oriented, customer-driven, investor-friendly,

professional, technically sensitive, accountable, fostering partnerships with all stakeholders

and committed to a continuous improvement in government business and the enhancement of

overall national productivity.28

Hence, the Bureau of Public Service Reforms was established on February 4,

2004 and given the following terms of reference: to initiate an Action Plan on the

reform at different levels for attention of the Steering Committee; to elucidate

government policy on reform; to coordinate, monitor, and evaluate reform im-

plementation activities; to conduct research on implementation efforts and pres-ent best practices models; to provide advisory and technical support services to

change management teams; to engender an environment of learning among

ministries, departments, and agencies; to disseminate information on all aspects of

reforms; and to submit quarterly progress reports on reform activities.

The goal of public service reform was to reduce the size of the Nigerian federal

bureaucracy. Each ministry, department, or agency of the federal government was

required to initiate and conduct its institutional reform based on its core mandate

while the cross-cutting reform issues, such as budget/financial management,

common resources management systems, procurement, policy management, andthe like, are handled centrally by appropriate agencies. By the end of 2007, 12

ministries were completely overhauled by the government: the Federal Capital

Administration, Federal Ministry of Finance, National Planning Commission,

State House, Federal Ministries of Transportation, Health, Foreign Affairs, In-

ternal Affairs, Science and Technology, Commerce, Solid Minerals, and Educa-

tion. The government has reduced the number of ministries by merging some of

them and has been employing the organizational and management structures.

Some ministries also have endeavored to computerize their payroll and conduct an

audit-and-pay verification exercise to weed out ghost workers. The Bureau ofPublic Service Reform co-opted other relevant federal agencies to address the

following reforms: performance management system, including target setting and



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performance assessment at individual, departmental, and organizational levels;

review of rules, regulations, and procedures; review professionalization of staff

cadres and the pool system; review of central personnel management; de-

velopment of a training and capacity building systems; information technology-

enabled payroll/personnel record system; other e-government implementation;pay reform; and, redundancy management.

The Public Enterprises Act of 1999 empowered the formation of the National

Council on Privatization and the Bureau of Public Enterprises as the Secretariat of

the Council. It has enabled the privatization of public enterprises in the key

economic sectors through the sale of government-held equity stakes, which has

drastically reduced the size of the federal bureaucracy. The privatization of some

of the public enterprises has led to the disengagement of an additional 32,240

workers from the public sector. The deregulation of the telecommunication sector

has been particularly successful, resulting in an increase of foreign investment in

the country.29 However, the growth potential in this sector has been due to pent-up

demand and a willingness on the part of the Nigerian consumers to bear higher

cost. While local participation has remained a priority of the government since

2005, the implementation of the privatization program has been hampered by

controversies and accusations of political favoritism, weak capital markets, and an

inappropriate regulatory framework.

The Public Service Commission was charged with the responsibility of hiring

and firing civil service officials. The federal government has introduced in-servicetraining programs for civil servants and a new salary scale has been put in place to

reward better performance. The Pension Reform Act was enacted in 2004 to en-

sure that the civil servants have good retirement benefits and those let go from the

civil service were given severance benefits and training for a smooth transition to

post-retirement life. The current pension scheme is a radical departure from the

former pay-as-you-go-system and is meant to provide a pool of funds to boost the

economy through savings and capital formation. In addition, the Service Com-

pact with all Nigerians has been introduced to encourage integrity among civil

servants and effective public-service delivery. The expensive and wasteful prac-tice of providing houses, cars, telephones, electricity, cooking gas, water, free

furniture, and medical services for the upper echelon of the civil service has been

stopped. The reform has monetized fringe benefits for all categories of public

servants.30 Consequently, the fleets of government cars and houses were sold in

a public auction and the revenue was paid to the Central Bank.

The Challenges to Good Governance in Nigeria

The term good governance, according to the International Monetary Fund

(IMF) and World Bank, consists of a wish-list of reforms, practices, and outcomes



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that are generally associated with the spread of democracy, the rule of law, effi-

cient bureaucracies, accountability and transparency, free market economies, and

independent judiciary.31 However, the concept has undergone recent modification

by emphasizing democracys needs for supportive institutions and processes such

as impartial judiciaries, transparent public agencies, and meaningful citizen par-ticipation.32 Therefore, good governance implies effective political institutions

and responsible use of political power and management of public resources by the

state. The United Nations Development Program defines governance as the

exercise of political, economic and administrative authority to manage nations

affairs at all levels.33

The various attempts to measure the quality of governance indicators continue

to face conceptual and ideological challenges.34 The World Bank categorized six

measured indices of good governance as follows: (1) voice and accountability; (2)

political stability and lack of violence; (3) government effectiveness; (4) regula-

tory quality; (5) rule of law; and (6) control of corruption.35 But has the Nigerian

reform agenda resulted in a more efficient, cost-effective, and responsive public

service? While opinions are divided among commentators on the impact of the

Nigerian reforms, it is fair to say that Nigerian public service reforms have been

partially successful, especially in the area of financial regulatory reforms. The

Nigerian government has introduced a series of innovations in the procurement

process to make it more transparent and cost-effective. But the key question still

remains whether Nigerias financial corruption vis-a-vis rentier money will beoverhauled by these reforms. On paper the reforms appear appropriate but, con-

sidering how deeply corruption is entrenched in Nigeria, one remains somewhat

skeptical. One of the challenges facing the federal government is whether it can

implement and enforce its own reforms.

Despite the public service reforms, the Nigerian government continues to be

ranked low on the good governance index in relation to other sub-Saharan

African countries.36 This is critical as the poor grade on good governance,

which Nigeria continues to receive, reflects the magnitude of the empirical

challenges facing the Nigerian government in its efforts to reform the federal bureaucracy. The quality of Nigerias public institutions is ranked low in-

ternationally, and the bureaucratic inefficiency still remains a major deterrent to

investment and growth.37 The process of implementing the reform program has

generated several policy inconsistencies and contradictions that have continued to

undermine the achievement of optimal performance and productivity in the

Nigerian public sector. Since the governance problems are massive and en-

trenched, Nigeria still lacks a democratically accountable executive branch, an

independent judiciary, a functional legislature, active and informed civic societies,

an effective civil service, and open and transparent policy-making processes. Thechanging of the attitudes of public personnel is also the most difficult aspect of this

reform process because of entrenched political and social interests. Part of this



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difficulty has been attributed to the fact that, while the public servants are the

target of the reform in terms of social dislocations, loss of privileges, and jobs,

they also are expected to serve as the agents of the reforms.

What has become obvious is that the military government, which was supposed

to be a corrective regime, failed catastrophically to stamp out financial corruption.As a matter of fact, it plunged Nigeria further into a rentier-state economy. The

present reform program is under the auspices of a so-called democratic form of

government. Therefore, the fledgling democratic system of government in Nigeria

requires time to mature. What Nigeria needs now is time and the right ideas that

can be enacted into laws and put into practice. Nigeria already has undertaken the

heavy lifting by constitutionally replacing the military government with a demo-

cratic one. With this in mind, there is hope that, with time, Nigeria will be a truly

democratic state and shed its rentier status. President Jonathan reiterated this point

during his address to the nation on the occasion of Nigerias golden jubilee cel-

ebration when he stated that,

. . . in midst of these challenges facing the country, it is easy to forget our unusual cir-

cumstances. We have actually been moving from one political instability to the other such that

we have barely been able to plan long-term and implement policies on a fairly consistent

basis. This instability has also impacted negatively on institutional development, which is

necessary for advancement. The structures of governance had barely been developed when we

ran into a series of political obstacles shortly after independence . . . . One of the greatest

achievements of our union these past 50 years is our togetherness, said the president whodeclared that a new Nigeria is [a project] in the making. . . .

38

Thus, it would be naive to think Nigeria, after only 12 years of embracing

democracy and only two democratic elections, is capable of enforcing all the

democratic reforms.

Problems of Corruption, Clientelism, and Political Elites in Nigeria: In Nigeria

there is a strong partnership between the multinational oil companies and thefederal government in the exploitation of petroleum resources. The underlining

logic of governance is that the allocation of resources and opportunities is done in such ways

as to strengthen the position of those in power. Such a system, operating over decades creates

wealth and influence which depend on these distributional patterns for their continued

existence.39

Consequently, corruption in resource-rich countries is often political and

bureaucratic in nature, involving both abuse of office on the part of key decision-

makers and corrupt acts among lower-level officials tasked with policy imple-mentation.40 The track records of most Nigerian military, politicians, and

bureaucrats demonstrate the misuse of the government oil revenues and the state-



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owned enterprises for political patronage and cronyism. They use the oil money

to maintain themselves in power. They siphon the rentier funds into private ac-

counts in Swiss banks, buy elections, build up their clienteles, and waste much of

the rest on bogus projects. This seems to be the case in Nigeria. In 2003 President

Obasanjo decried this endemic corruption:

Until 1999, Nigeria had practically institutionalized corruption as the foundation of gover-

nance. Hence institutions of society easily decayed to unprecedented proportions as oppor-

tunities were privatized by the powerful. This process was accompanied, as to be expected, by

the intimidation of the judiciary, the subversion of due process, the manipulation of existing

laws and regulations, the suffocation of civil society, and the containment of democratic

values and institutions. Power became nothing but a means of accumulation and subversion as

productive initiatives were abandoned for purely administrative and transactional activities.

The legitimacy and stability of the state became compromised as citizens began to devise

extra-legal and informal ways of survival. All this made room for corruption.41

The deeply entrenched neopatrimonial institutions and systemic corruption are

central to understanding the Nigerian governments resolve to change its gov-

ernment for the better. Neopatimonial rule undermines formal rules and in-

stitutions of governance by using it for systematic patronage and clienteles as

a means of maintaining political order.42 As Richard Sklar and his colleagues

asserted,

Neopatrimonialism is bad for Nigeria, as for other countries, because power is excessively

personalized while national policy is driven by elite relationships rather than by public needs.

Neopatrimonialism may randomly allow more enlightened rulers to govern and even to install

some reforms for a time, but these inevitably come second to the unending need to service the

expensive elite relationships that keep one in power.43

The Nigerian governments passage of the Extractive Industries Transparency

Initiative (EITI) into law in 2004 has provided the legal basis for collecting and

publishing oil and gas revenue data and thus opening up oil rents to greater

scrutiny. The public disclosure of oil contracts is intended to ensure the integrity of

the bidding process and negotiations as well as guarantee transparency of gov-ernment contract awards. However, there have been allegations of corruption or

that Obasanjo hand-picked the civil society representatives on the stakeholders

committee overseeing the NEITI process. This committee has met irregularly,

fueling the perceptions that civil society is being manipulated or marginalized.44

This legal instrument is only a partial solution to the problem. The application of

legal policy instruments as universal norms for controlling corruption is very

much dependent upon effective implementation and on the close monitoring by

activists of civil societies, parliamentary communities, and the international

community.45

The prospects for effective bargaining between the Nigerian gov-ernment and the general public is still very weak, because civil society lacks the

capacity and resources it needs to truly influence government policy, programs,



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and legislation. Therefore, the ruling elites are relatively unrestrained by orga-

nized societal interests. The federal government needs independent civil society

groups to put government excesses in check.

While it is true that Nigeria has improved slightly its corruption perception

rating index, much remains to be done to fully overcome the rampant corruption.46

In support of this, the former World Bank Representative in Nigeria, Dr. Hafeex

Ghanem, in his valedictory speech in 2007 in Abuja, cautioned Nigeria not to

claim victory over corruption yet because the country still had numerous chal-

lenges on the enforcement front. The oil windfall has enabled the Nigerian gov-

ernment to increase its expenditures through the offering of public-sector inflated

contracts and thus provide increased opportunity for kickbacks or other avenues

for siphoning off public funds. According to the Nigerian governments own as-

sessment, the country has been plagued by a rent-seeking and unproductive

culture of over-dependence on government patronage and contracts, with little

value added.47 Although a nation may transit from authoritarian rule to a demo-

cratic system of government, according to Peter Lewis that does not necessarily

mean neopatrimonialism has disintegrated in the process. Instead, as evidenced in

most African countries, it has been reconfigured rather than displaced by the new

democratic structures. Many elected presidents have adapted to patronage struc-

tures, cultivating crony relationships with key notables and marginalizing political

rivals or opponents.48

Although the oil industry was governed by a number of public-sector in-stitutions, it is the President and his closest advisers, along with the top leadership

of the Nigerian National Petroleum Cooperation (NNPC), who manage the pe-

troleum industry. In addition, President Obasanjo virtually served as the Minister

for Petroleum during his administration, with very little influence from his junior

Minister of State for Petroleum. This did not augur well for transparency as

Nigerias principal source of rentier money was almost entirely in the personal

control of the President. As Minister of Petroleum, he awarded contracts in the oil

industry to transnational oil companies. It is through the contracting procedures

that corruption and bribery infiltrate the Nigerian oil sector as these contracts didnot follow due process. This makes it difficult to assess their contracts, know what

revenues actually accrue to the government from the petroleum industry, and hold

government accountable for their revenue management. For example, between

1994 and 2004, the officials of Halliburton, an American company, admitted to

funneling millions of dollars to top Nigerian government officials in what turned

out to be a monumental corruption scheme, in return for multibillion dollar con-

tracts to build the Nigerian Liquefied Natural Gas (LNG) facility in Bonny.

While the National Economic Empowerment and Development Strategy may

clearly recognize that a key aspect of the institutional reforms is to fight cor-ruption, the current piecemeal approach by the government anti-corruption

agencies may amount to too little, too late. The irony of the anti-corruption



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crusade in Nigeria is that the anti-corruption agencies called upon to help eradicate

corruption have themselves become agents of mass corruption. This has enabled

the new actors to enrich themselves at societys expense and thus reinforces the

image of Nigeria as a prismatic society.49 To make matters worse, the anti-

corruption crusade in Nigeria is profiling certain members of the public servicewho are considered opponents of the government and ignoring those wealthy and

powerful enough who can buy their way through the legal system.50 These anti-

corruption agencies have become toothless bulldogs because they also lack the

power to deal aggressively with the endemic corruption in government. Their

terms of reference only empower them to investigate, bring charges, and prosecute

offenders in the courts, which have already proved to be ineffective in aggres-

sively dealing with these corrupt public officials. The Transparency International

Report stated that Nigeria has an impressive array of structures, institutions, and

laws aimed at combating corruption but still falls short of the standards and re-

quirements of an effective anti-corruption regime as demanded by the conventions

against corruption.

The irony of democratic politics in Nigeria is that it disregards democratic

political culture. The general elections of 2003 and 2007 were marred by what

international and domestic observers characterized as massive fraud and serious

irregularities, including vote rigging and political violence. The flawed elections

have provoked widespread outrage among the Nigerian public, who have called

for electoral reforms and demonstrated a disturbing evidence of popular disen-gagement from the democratic process. In fact, despite the glaring cases of fraud at

the elections, which necessitated the nullifications and cancellations of some of

the results, not a single perpetrator has either been apprehended or prosecuted.

While there have been spate reversals of electoral mandates by the election tri-

bunals, the NEPAD-APRM Nigeria: Country Self-Assessment Report: Executive

Summary stated that political corruption continues to remain a major challenge to

progressive politics in Nigeria.

. . . of all forms of corruption, political corruption has remained a major obstacle to national

progress in Nigeria. The current democratic regime has put in place mechanisms that can

prosecute the war against corruption, while there is improved awareness on the part of the

citizenry regarding the imperative of exorcising the ghost of corruption. . . But not much

appreciable progress has been made in coming to terms with political corruption expressed in

electoral fraud and vote buying as demonstrated by the 2003 and 2007 elections. In general,

there is a challenge to check the excessive use of money in politics.51

In 2007, the late Nigerian President Mr. Umaru Musa YarAdua lamented that

corruption is the most worrisome problem of public life in the country. Corruption,

he regretted, had eaten deep into the fabric of the society and polluted even themost sacred and sacrosanct institutions of Nigerian national life over the years. He

pointed out that corruption is massive, extensive, endemic, and pervasive at all



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levels of the government and the society, and no noble policy of government or

any laudable program stood the chance of success if public resources were ha-

bitually and brazenly frittered away by those entrusted with them. The late

president observed that corruption has distorted planning and implementation of

policies, prevented equitable and even distribution of opportunities and resources,hampered economic growth and development, and had given Nigeria a tarnished

image globally.52

Problem of Weak Institutional Capacity in Nigeria: Corruption, according to the

World Bank, often flourishes where institutions are weak, where the rule of law

and formal rules are not rigorously observed, where political patronage is rife,

where the independence and professionalism of the public sector have been

eroded, and where civil society lacks the means to generate public pressure.53 The

difficulty in managing oil revenues in most oil-exporting countries has been at-

tributed to weak political and administrative capacity and to the lack of public

participation necessary for counteracting rent-seeking behavior.54 Therefore, it is

assumed that the implementation of good governance and institutional changes

can address the paradox of plenty and thus argue for the need to build competent

and capable state institutions that can promote good governance, economic

growth, and reduce poverty. But despite the rhetoric of adopting governance re-

forms by the Nigerian government, the problem is that their prescriptions foradministrative reforms have not taken into serious account the many insights of

the new trends in public administration.

Since the early 1990s, the paradigm shift toward new public management has

called for performance orientation toward increased technical efficiency, flexi-

bility, and accountability among both developed and developing nations. The

model has provided a critique of the traditional model of public administration by

accepting the weakness of traditional measures of personnel management in the

face of hierarchy, the development of powerful institutional cultures, and their

resistance to change. With respect to administrative reforms, the new publicmanagement model stresses the need for public choice, the separation of policy-

making and policy implementation, and the use of market mechanisms to address

public sector problems.55 It emphasizes the importance of radically altering the

structure of administrative agencies to overcome the problems of bureaucratic

hierarchy, with managers clearly taking greater responsibility.

The Nigerian reformers are still entrenched in the standard prescriptions of

old-line public administration, especially their lack of a full commitment to

decentralization as advocated by the donor community because of the nations

dependence of rentier money. The process of devolution of power andresponsibilities in Nigeria has proven to be very difficult in most cases and has

remained an ideal rather than a reality. Can Nigeria, a classic case of a rentier state,



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truly reform itself and break away from the shackles of dependence on rentier

money? Judging from the proposed current reform under way, the answer is no.

The current public-sector reform is not intended to radically dismantle the pa-

thologies of the rentier statehood, which has swallowed the Nigerian democratic

governance.56 Rather it is an attempt to reform the bureaucratic apparatus of theNigerian state. Brian Levy cautioned us to learn from the lesson of experience of

the past bureaucratic reform efforts in Africa:

. . . a principal reason for the limited success of the first round of efforts to build state capacity

was the implicit presumption that the weakness of public administration was managerial and

could be remedied in a straightforward manner through a combination of organizational

overhaul and financial support to procure the requisite specialist technical advice, training,

and hardware. By contrast, a central lesson of experience. . . is that public administrations are

embedded in a complex, interdependent system. This system incorporates not only the bu-

reaucratic apparatus as a whole, but also political institutions and social, economic, and po-

litical interests more broadly.57

Pierre Englebert also has reviewed this type of public-sector management re-

forms and the consequence for governance reforms in Africa:

Patterns of bureaucratic inefficiency, corruption, delinquent rule of law, and the like answer to

a political logic and are consequences of the dichotomization between statehood and power in

African non-legitimate states. It is hard to see how public sector management programs ad-

dress these deeper issues. They may provide temporary Bands-Aids, but they are unlikely to

bring about lasting improvements.58

The weakness of the Nigeria reform agenda is that it views its political and

economic woes solely on the malfunctioning of the bureaucracy. An improved

governance reform agenda in Nigeria will require the radical transformation of

Nigeria from a rentier state to a more modern and democratic one. This means

creating democratic governance with strong, efficient, and effective institutions

that can foster a culture of accountability and transparency. For such a trans-

formation to take place, the reforms must be embedded within the broader socio-

economic, political, and constitutional frameworks of the country, a product ofdeliberate policies, which require all institutions to function in accordance with

. . . a countrys constitutional provisions of the rule of law, due process of law,

cultures and traditions.59 J. Robinson et al. argue that the key to avoiding the

resource curse is institutions that limit the ability of governments to distribute

public-sector positions to political supporters, which distorts the allocation of

resources in the economy.60 Good governance depends on the qualities of the

men and women that deal with governance. It is institutions that guarantee good

governance.61

However, Nigerias reliance on a rentier political economy has adverse effectson the development of democratic institutions and consolidation.62 With the failure

of parliamentary democracy in 1966, Nigeria was ruled for decades by decrees



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rather than by the constitution, which prevented democratic political culture from

firmly taking root in Nigeria. Upon assuming power, the military junta ensured

that they purged the Nigerian armed forces and the civil service of all elements

they considered a potential threat to their regime. They also banned political

parties, marginalized civil society organizations, undermined the judiciary,threatened the media, stifled private-sector initiative, and created an atmosphere of

fear and submission. The long military rule in Nigeria has left in its wake a tra-

dition that has institutionalized or reinforced opportunities for corruption and rent-

seeking behavior. The present presidential democracy is plagued by an ill-defined

constitution, weak political institutions, an inefficient bureaucracy, a delinquent

judiciary, and a presidential power monopolysome of the characteristics of the

previous military regime. In such circumstances, the stakes are huge for the

governing elites, who seek access to the Nigerian rentier state because it is per-

ceived as a means of rent accumulation rather than a catalyst for sustainable

development.

What Nigeria needs is a competitive political system in which alternation of

power exists among political parties through a credible and transparent electoral

system. Such a system will provide an increase in the quality of governance by

strengthening mechanisms of both horizontal and vertical accountability as well as

a strong independent judiciary to protect the interests of those out of power. But

what we have is a multi-party democracy in which politics is still characterized by

personal rule and oligarchic control by the dominant political party, the PeoplesDemocratic Party. The opposition has little or no influence on government poli-

cies, programs, and legislations. The Nigerian political leaders distribute rentier

money to co-opt the opposition parties to ensure their patronage in maintaining the

status quo and thus avoid having to relinquish power through competitive elec-

tions. The fledgling democratic rule is only 12 years old and is marked by flawed

elections, financial embezzlements, a compromised judiciary, and a dysfunctional

social system. Many of the formal democratic institutions still lack the autonomy

and resources needed to successfully carry out their assigned tasks. There is

a desperate need for political decentralization of powers as outlined in the Nigerian constitution.63

Obasanjos presidency dominated the other branches of government and

treated them as appendages of the executive branch rather than independent

branches. In a situation of relatively weak opposition parties, President Obasanjo

often attempted to manipulate the other democratic institutions in order to bolster

his power beyond formal constitutional control. This was evident in the attempt to

extend his presidential tenure limits, a reflection of executive ambition and dis-

regard for the constitutional authority. The independent roles of the legislative and

judicial branches of government to check the monopoly power of the executivebranch was virtually non-existent in Nigeria in part due to the overdependence on

rentier money, making the presidency almost an absolute monarchy. The president



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governs by trying to centralize absolute power in the presidency. There is a crucial

need for a delicate balance of power in a democracy with legislative, judicial, and

executive branches of government, particularly as Nigeria has been under military

rule for the majority of time since it gained its national independence. The

Nigerian legislature should play a more dynamic role in developing national policy, controlling the budget, and monitoring of project implementation. This

would foster greater openness, accountability, and transparency in the country.

Despite constitutional guarantees, the general perception of the average

Nigerian is that the nations judiciary is poorly administered, corrupt, and only

partially independent. The judiciary is weakened by undue pressure from political

and economic lobbyists. Bribery of judges sometimes influences the outcomes in

the courts. Judicial investigations are often slow and prejudicial. The shortage of

judges and their poor service conditions further contribute to noticeable delays in

settling cases. The judicial reforms under way fall short of adequately addressing

the weak judicial system in Nigeria. Nigeria needs to re-build its judicial capacity

by improving the underlying conditions of service for judges and supporting

personnel, promoting judicial independence, and nurturing impartial dispute res-

olution by judges.

Problem of a Militarized Bureaucracy in Nigeria: One of the legacies of the

military regime has been its strong influence in the development of the bureau-

cracy in Nigeria. The military regime did not appreciate the professionalism of theNigerian bureaucrat. The due process principle was disregarded as too slow for the

military approach. There was no room for discussion, dialogue, or negotiation.

The military government frequently was resistant to suggestions from civil ser-

vants and disdainful of time-tested principles of public administration. Over the

years, the civil servants serving under the military administration abandoned some

of the better qualities that existed in the bureaucracy and replaced them with more

authoritarian methods as an approach to public service. Even when an order was

deemed contradictory, the military boss told the civil servant to make it work.

Consequently, the civil service protocol and professionalism were compromisedfor a period of about 30 years, thus leading to the public services un-

responsiveness to the citizens. A large credibility gap grew with the public. The

close collaboration of the public servants with the military ruling class further

engrained an environment of corruption, elitism, and patronage, which led to the

deterioration of the public service values of loyalty to the state. Loyalty to the

ruling elite replaced state loyalty, and there was no one to protect the national

interest.64 As A. Mukoro correctly observed:

The experience of Nigeria is such that the administrative state allows a clique of public of-

ficials, the military and politicians to accumulate wealth, get away with it and leave the system

to suffer for it. The effect of this and other constellating factors earlier mentioned render



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public administration ineffective, ineffectual and corrupt. Administrators support whatever

government is in power and end up becoming part of the rot.65

The introduction of the Structural Adjustment Program (SAP) by the military

in the 1980s and 1990s was a major departure from the public-sector-led de-velopment strategy. Since then, the Nigerian economy has been driven by fiscal

crises, and as a result, the focus of the reform process has been on cost-cutting at

the expense of improvement in public-sector effectiveness.66 The argument was

that the public sectors expenditure had grown too high and, therefore, there was

urgent need for staff rationing in government agencies. The strategy, which was

recommended by the IMF and World Bank, has been to reduce the dominance of

the public sector in the economy and develop the work force levels that will en-

hance the competitive advantage of the state in the global marketplace. The extent

to which the work force in the civil service has been reduced and the extent towhich public enterprises have been commercialized becomes the measurement

criteria instead of efficiency and effectiveness as the main factors in assessing the

success of the reform. SAP undermined effective wage incentives for civil service

employees and, as a consequence of its austerity measures, resources allocated for

training programs of public officials and staffing of training centers have been

drastically reduced. The various measures taken by the government have failed to

have an effect on employment generation, performance, or productivity in the

country. What seems to be evident is that there is a prevalence of capacity deficits

in the public service.

It is important to distinguish between state scope and state strength. Scope refers to the range

of activities pursued by the state. Strength refers to how effective the state is in pursuing its

activities. Public sector reforms attempted to restrict the scope of state activity, but the main

obstacle to modernization in developing states is a lack of state strength. As a result, the

reforms often proved to be tragically inappropriate to developing states. The pressing need in

many developing states is to establish bureaucratic institutions with clear lines of account-

ability, impartial officials, and abstract rules to guide them.67

The unintended consequences of this policy of retrenchment and retirement ofemployees in the public sector is that it has exacerbated the already high rate of

unemployment in the present Nigerian economy, creating social dislocations and

loss of jobs among those groups without adequate social safety nets. The re-

ductions in the overall level of public-sector employment have not been accom-

panied by increases in the private-sector job market in Nigeria. The weakness of

this strategy thus calls for a rethinking of the management framework within

which this policy is formulated and implemented and the need to consider other

alternative policy development and management frameworks.68 The policy of

downsizing not only contradicts one of the NEEDS basic objectives of employ-ment generation, but it also has not improved the quality of public services. In

spite of the governments best intentions for the discharged officials in terms of



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transition to productive post-retirement life, it clearly has added to the large

armies of unemployed, which continues to be a major national problem in both

the public and private sectors. The social repercussions of the high level of

unemployment have been manifested in the rise of poverty, crime, delinquent

and anti-social behaviors, and a general state of insecurity about life andproperty in the country.

While the current bureaucratic reform initiatives may have introduced some

cosmetic changes in Nigerias public-sector management, the sustainability of

these reforms over a longer term remains very much uncertain because of the

problem of declining institutional capacity, poor motivation, low wages/salaries,

and popular dissatisfactionall of which have been exacerbated by the declining

economic fortunes of the country.69 The federal government bureaucracy is still

plagued by absenteeism, lateness, idleness, endemic corruption, and low morale.70

The militarization of the federal bureaucracy has done a great disservice to the

once highly efficient administrative machine, which has shown progressive signs

of decline, especially in the areas of technological and knowledge-based man-

agement and administration. More importantly, some senior elements of the public

service have not only been resistant to complex governance reform programs

being introduced by the government, but they also lack the suitable skills and

expertise required to operate in an age of high-tech and information technology.

The short in-service training and other professional development opportunities

have not been able to fill this deficiency.

71

Consequently, the quality of gover-nance and public service has declined in every sphere of government endeavor,

such as economic management, the health-care delivery system, education, and

social services provision.

The poor performance and low productivity is clearly evidenced in the mis-

management of governmental ministries and parastatals, for example, in the

Power Holding Company of Nigeria. The state-owned utility has continued its

inadequate production of electricity, making industrial development difficult and

leaving the demand for business and residential electrical needs unfulfilled. The

House of Representatives recently concluded an investigation into the alleged $16billion spent on the rehabilitation of the power supply infrastructure in the country

between 1999 and 2007. The investigation was undermined and no prosecutions

resulted. For Nigeria to achieve accelerated economic growth and development,

rapid progress is needed in improving the quality and quantity of electric power in

the country. Most small and all medium to heavy machinery requires electricity to

function. An uninterrupted power supply will improve industrial production and

the domestic services so badly needed. The IMF correctly observed that a deficient

power infrastructure dampens economic growth and weakens competitiveness,

with detrimental effects on productivity. In fact, the power sector remained animmediate priority if the Nigerian Governments Vision 2020 to become an in-

dustrialized nation is to be realized.



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Conclusion and Policy Recommendations

The overwhelming concentration of political and economic power in the ex-

ecutive branch, operating over decades of undemocratic governance, steered

Nigeria into rentier statehood and the practice of predatory political economy.President Obasanjos regime (1999-2007), which promised a new era of good

governance by eliminating corruption and poverty through the privatization of

public enterprises, and in theory freeing the government to concentrate on gov-

erning, failed to meet expectations.72 It appears that as long as Nigeria continues to

depend on rentier funds to meet most of its budgetary needs, Nigeria will continue

to be plagued by the limitations of rentier statehood. Whatever the short-term

successes that may be achieved from the present reforms, they are likely to be

slowedif not preventedby Nigerias well-established governance problems

such as personal rule, clientelism, patronage, and corruption. Thus, there is anurgent need to counteract the rentier incentive structures by strengthening the

democratic institutions to provide a check on extra-legal activities by political

interests as well as to govern the bureaucracy in ways that hold them accountable

for achieving public ends. A sure path to good governance and sustainable de-

velopment in Nigeria is through the establishment and promotion of effective

democratic governance, in particular, institutionalized democratic mechanisms for

increased accountability, transparency and oversight in order to curb arbitrariness

and rent-seeking behavior in all government operations.

It is necessary, therefore, to align the mission and vision of the public-service

reforms with the imperatives of sustainable democracy, a dynamic market economy,

and a vibrant private sector. By law, the federal government owns the oil and natural

gas resources of Nigeria. As a result, the federal government has relied more on oil

money to meet its financial needs, thus giving the federal government financial in-

dependence from its citizens; in short, it is not a government by the people and for the

people. Privatization of public utilities is a step in the right direction. Were the federal

government to recognize and hand over a greater proportion of the oil wealth to the

local community, Nigeria would weaken the rentier state. Instead of spending vasttime and human resources on the exploitation, management, and distribution of oil

resources, the federal government could focus on oversight, monitoring, regulatory,

and strategic functions. Somewhat like corporate governance, where the role of the

Board of Directors is used to maintain order between the firms stakeholders and

its top managers, the role of the federal government could help to enforce the con-

tractual obligations of all the parties involved in the oil commercial transactions. This

is the type of reform that Nigeria needs to stimulate healthy competition among the

federating states and diversify the tax base for government revenue in order to reduce

the countrys dependence solely on oil rents.In practice, this also would mean creating a highly robust fiscal federalism in

which the federating units, with major responsibility, contribute to the common



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pool of the federation on the basis of an agreed upon principle or pay prescribed

taxes to the federal government.73 The decentralization and devolution of power

and responsibilities will not only empower the local communities participation in

the fiscal management but also will facilitate the right incentives for governance

that are currently missing. This would allow expenditures and tax decision makingto be aligned more closely, thus improving prudent fiscal management that will

help to mitigate rent-seeking behavior and to deal with the dilemmas of the rentier

state. It could further ensure the flow of wealth from the source (local commu-

nities) through the state government to the federal government and better integrate

the local institutions into the sub-national governance system, thereby enhancing

their capacity, accountability, and performance. It would encourage a participa-

tory and open budgetary process. However, a renewed commitment by the civil

society groups to increased public oversight activities as related to tracking and

monitoring of budget implementation should be encouraged and supported in

order to monitor resource flows to oilproducing states and local government

areas. This is to ensure that funds allocated to them do not end up in the foreign

bank accounts of corrupt local elites and thus contribute to the process of trans-

parency and accountability, which is intrinsic to good democratic governance in

Nigeria.

NOTES

1Federal Government of Nigeria (The NEEDS Secretariat), Meeting Everyones Needs: National

Economic Empowerment and Development Strategy (NEEDS) (Abuja, Nigeria: Nigerian National

Planning Commission, March 2004), p. 63.

2Ahmed Al-Gazali, The Role of Civil Service in National Development, paper presented at

the Participants of National Defense College Course One, Abuja, Nigeria, October 30, 2007, p. 4.

3O. Obasanjo, Inaugural Speech Delivered to the National Assembly, Abuja, Nigeria, 1999,

quoted from Abdullah A. Sheikh, The Civil Service Reforms, in Nigerias Reform Programme:

Issues and Challenges, eds. Hassan Saliu, Ebele Amali, and Raphael Olawepo (Ibadan, Nigeria:

Vantage Publishers, 2007), p. 349.

4H. Beblawi, The Rentier State in the Arab World, in The Arab State, eds. H. Beblawi and

G. Luciani (New York: Croom Helm, 1987), p. 85.

5See Axel Harneit-Sievers, Reforming the Rentier State: Some Thoughts on NEEDS, in

Contexting NEEDS Economic/Political Reform in Nigeria, eds. Sam Amadi and Frances Ogwo

(Lagos, Nigeria: Hurilaws & CPPR, 2004).

6Ibid., p. xiii.

7Kenneth Omeje, Oil Conflict and Accumulation Politics in Nigeria, Environmental Change

and Security Project Report. No. 12 (Washington, D.C.: Woodrow Wilson International Center for

Scholars, 2007), pp. 46-47.



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8D. A. Yates, The Rentier State in Africa: Oil Rent Dependency and Neocolonialism in the

Republic of Gabon (Trenton, New Jersey: African World Press, 1996), pp. 21-22.

9See Daniel J. Smith, The Culture of Corruption: Everyday Deception and Popular Discontent

in Nigeria (Princeton: Princeton University Press, 2007).

10T. L. Karl, Ensuring Fairness: The Case for a Transparent Fiscal Social Contract in Es-

caping The Resource Curse, eds. Macartan Humphreys, Jeffrey D. Sachs, and Joseph E. Stiglitz

(New York: Columbia University Press, 2008), p. 264.

11H. Mahdavy, The Patterns and Problems of Economic Development in Rentier States: The

Case of Iran, in Studies in the Economic History of the Middle East, ed. M. A. Cook (Oxford:

Oxford University Press, 1970), p. 443.

12See H. Beblawi, op. cit., and Michael L. Ross, Does Oil Hinder Democracy? World Pol-

itics, April 2001, p. 330.

13Erika Weinthal and Pauline Jones Luong, Combating the Resource Curse: An Alternative

Solution to Managing Mineral Wealth, Perspectives on Politics, March 2006, p. 36.

14Mathias Okwe, Taxation as a Springboard towards Economic Development, The Guardian

Newspaper, October 20, 2010.

15D. A. Yates, op. cit., p. 33.

16U.K. Department for International Development (DFID), Eliminating World Poverty:

Making Governance Work for the Poor, White Paper on International Development (London: Her

Majestys Stationery Office, 2006), available at http://www.dfid.gov.uk/wp2006/.

17M. Humphreys et al., op. cit., p. 11.

18The World Bank, Where is the Wealth of Nations? (Washington, D.C.: The World Bank,

2006), p. 65.

19Kenneth Omeje, High Stakes and Stakeholders: Conflict and Security in Nigeria (Aldershot,

United Kingdom: Ashgate, 2006) and ed., Extractive Economies and Conflicts in the Global South:

Multi-Regional Perspectives on Rentier Politics (Aldershot, United Kingdom: Ashgate, 2008).

20Charles McPherson and Stephen Macsearraigh, Corruption in the Petroleum Sector, in TheMany Faces of Corruption: Tracking Vulnerabilities at the Sector Level, eds. J. Edgardo Campos

and Sanjay Pradhan (Washington, D.C.: The World Bank, 2007), p. 192.

21For effective states in the various manifestations, see Mick Moore, Revenues, State For-

mation, and the Quality of Governance in the Developing Countries, International Political

Science Review, July 2004, pp. 297-319.

22See H. Mehlum, K. Moene, and R. Torvik, Institutions and the Resource Curse, The

Economic Journal, January 2006, pp.1-20; I. Korhonen, Does Democracy Cure a Resource

Curse? Discussion Paper No. 18 (Helsinki: Bank of Finland Institute for Economies in Transition,

2004), available at http://www.bof.fi/boft/eng/6dp/04abs/pdf/dp1804.pdf; and Paul J. Stevens, The

Resource Curse and How to Avoid It, The Journal of Energy and Development, autumn 2005, pp.

1-19.



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25/27


26/27

47Federal Government of Nigeria, Meeting Everyones Needs: National Economic Empower-

ment and Development Strategy (NEEDS), p. 63.

48Peter Lewis, Growth without Prosperity in Africa, Journal of Democracy, March 2008,

pp. 101-02.

49The model of prismatic society is where the traditional and modern values and behaviors

coexist in the same organization. For negative effects on public administration in the developing

countries, see Fred Riggs, Administration in the Developing Countries: The Theory of Prismatic

Society (Boston: Houghton Mifflin, 1964), pp. 227, 423-24, 426-27.

50See Ben Rawlence and Chris Albin-Lackey, Indicting the Opposition: Nigerias War on

Corruption Seems to be Turning into a Political Witch Hunt, The Guardian, March 22, 2007,

available at http://www.guardian.co.uk/commentisfree/2007/mar/23/despiteeightyearsofcivilia.

51 NEPAD-African Peer Review Mechanism (APRM) Nigerian Secretariat, NEPAD-APRM

Nigeria: Country Self-Assessment Report (CSAR), Executive Summary (Abuja, Nigeria: Govern-

ment Printing Press, May 2007), available at http://www.nepadaprmnigeria.org.

52 Nigerian Tribune, November 28, 2007.

53The World Bank, Can Africa Claim the 21st

Century? (Washington, D.C.: The World Bank,

2000), p. 74.

54Xavier Sala-i-Martain and Arvind Subramanian, Addressing the Natural Resources Curse:

An Illustration from Nigeria, Working Paper WP/03/139, Washington, D.C., International Mon-

etary Fund, May 2003.55Tom Christensen and Per Laegred, New Public Management: The Transformation of Ideas

and Practice (Aldershot, United Kingdom: Ashgate Publications, 2001).

56For a more detail discussion of the seven pathologies of the rentier state, see Mick Moore, op.

cit., pp. 306-08.

57Brian Levy, Governance and Economic Development in Africa: Meeting the Challenge of

Capacity Building, in Building State Capacity in Africa: New Approaches, Emerging Lessons, eds.

B. Levy and S. Kpundeh (Washington, D.C.: World Bank Institute, 2006), p. 11.

58Pierre Englebert, State Legitimacy and Development in Africa (London: Lynne Rienner

Publisher, 2002), p. 180.

59United Nations Economic Commission for Africa (UNECA), Governance Report (Addis

Ababa: UNECA, 2005), p. 197.

60J. Robinson, R. Toorvik, and T. Verdier, Political Foundations of the Resource Curse,

Journal of Development Economics, February 2006, pp. 447-68.

61High Level Panel of the African Union, Audit of the African Union (Addis Ababa: African

Union, December 18, 2007), p. 23.

62M. Ross, 2001, op. cit., and M. Ross, Does Taxation lead to Representation? British

Journal of Political Science, March 2004, pp. 229-49.



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“reforming the rentier state: the challenges of governance reforms in nigeria,” by paul g....

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