Debt relief: Obasanjo berates U.S. on Nigeria

Samuel Famakinwa and Kunle Aderinokun, This Day (Lagos)
September 16, 2004

President Olusegun Obasanjo yesterday chided on the United States government over what he described as the country’s discriminatory policy on granting debt relief to debtor countries which favour even richer countries.

Similarly, he sought from the US support for Nigeria’s effort at maintaining peace, security and stability in the oil-rich Gulf of Guinea where even America has vested interests.

Addressing participants at the Nigeria-US Investment Confer-ence in Abuja, the president queried the basis for which the US extended special dispensation for debt relief to countries like Russia and Iraq and declared that “I find this very very absurd.”

He added that since the US could give special dispensation for debt relief to countries like Russia and Iraq that have more resources than Nigeria, “I don’t know why Nigeria can not get the same treatment.”

At the conference organised by the Nigeria Economic Summit Group (NESG) and the Corporate Council on Africa (CCA), Obasanjo said that he found it very uneasy to believe that Russia which has the “same population as Nigeria and produces nine million barrels of crude oil per day which is even more than three times Nigeria’s oil output per day, would get special dispensation for debt relief from the US yet Nigeria would not get.”

He added that “Iraq whose income from oil is six times more than that of Nigeria even got special dispensation for debt relief and Nigeria would not get. I find this very very absurd and I hope this issue would be discussed at this conference.”

“The total debt that is between us and the United States is under $1 billion. When we talk about it, I get agitated a bit. I find it a bit uneasy for me to talk about it. Nigeria’s population is about 150 million, Russian population is about 150 million, Russian oil production is about 9 million barrels a day, Nigeria is not even producing 1/4 of that and yet Russia got special dispensation for debt relief, Nigeria did not get.

“Iraq whose per capital income in oil term is six times that of Nigeria is getting special dispensation for debt relief, Nigeria did not get. I find this absurd. And I say to my self, if we say we are joint guarantors, what is of paramount importance to both of us, shouldn’t we do something to show it,” he asked.

Obasanjo said that credit extended to Nigeria for development of different sectors of the economy could be managed jointly with the United States and other respective United Nation’s agencies to see if the Federal Government genuinely apply the funds for the sought purposes with a view to granting the nation debt relief .

“I suggested that in the area of debt relief, we could tie it to development projects. I am not asking you to write it off but let’s put it in health, education, etc. We could call it. Debt for health or debt for education and we can jointly manage it. Look at our budget for the year 2004 and in 2005 see if we have genuinely put $30 million on higher education. You can do that in arrears or even in advance, put our credit in an escrow account, you and ourselves and ADB, or the international organization in that respect. If it is education, UNESCO, if it is health, WHO, if it is agriculture, FAO. I believe that there are many ways that we can get to see ourselves as true guarantors and partners of things that are really dear to us,” he said.

In the same vein, Obasanjo tasked the US government in supporting Nigeria’s effort in maintaining security, peace and stability in the Gulf of Guinea since both countries as well as the countries in the region have vested interests.

According to him, “If we are going to be joint guarantors of peace, security and stability, we also have to be mutually supportive.”

The President pointed out that energy will be a major factor in driving the Nigerian and American economy, as well as that of the world and that an area that was becoming more and more important as a source of energy to the world was the Gulf of Guinea and therefore the need to maintain security and stability.

He stated that he had spear-headed the establishment of the Gulf of Guinea Commission to embrace all countries within the area.

“One of the things to ensure security is the way we resolve our issues. We have indicated in the way we resolve maritime boundary issue between Nigeria and Sao Tome. We’ve also been able to resolve the maritime and boundary issue with Equitorial Guinea and by the grace of God, we will soon resolve that of Cameroun. These efforts should be strongly supported by the US knowing fully well that whatever we do to ensure peace and security is of primary importance to us, the world need it and the US needs it. I believe that we should work together in economic and strategic relation.”

But he noted that “we cannot talk about working together when we are not seeing the type of involvement that we should see in our partners. We know that we have to have peace and security in Africa. We have said we are ready to play our own role. We have done it in Sierra Leone, we have done it in Liberia and we are doing it in Darfur. But what we lack is the capability. Help us in this area that we are lacking so that we can move more swiftly in terms of conflict resolution.”

Meanwhile, Obasanjo said the federal Government had since on assumption of May 29, 1999 embarked upon an aggressive development and rehabilitation and improvement of infrastructure especially electricity, roads, and water as well as development of human capitals.

Therefore, he said, the investments have paid off given recent statistics that showed that the economy is on the upswing with “gross domestic product growing at 10.2 per cent in 2003 as against an average of 2.9 per cent in the immediate past decade.”

He added that on sectoral basis, the agricultural sector grew by 7 per cent in 2003. This, according to him, “represents a marked departure from the positions in 1999. The manufacturing sector also grew by 10 per cent in 2003 in contrast to less than 1 per cent; capacity utilization rose from 35.9 per cent in 1999 to 60 per cent in 2003; and our target by the end of 2004 is to achieve no less than 65 per cent industrial capacity utilization,” he said.

He pointed out that the dividends of such response manifested in the GSM telecommunications where the teledensity has risen from 1.125 in 1999 to about 1.40 in 2003 and made the sector one of the fastest growing with over 50 per cent growth rate in 2003.

Obasanjo said all these achievements are expected to be consolidated by the Natonal Economic Empowerment and Development Strategy (NEEDS) with key objectives as wealth creation, employment generation, poverty reduction and value re-orientation.

In his welcome address, Chairman, NESG, Mohammed Hayatu-Deen, stated that Nigeria’s range of choices and alternatives have multiplied because of the openness that characterizes democracy, adding that the country now engages the world in a host of collaborative endeavors and provides strong leadership to Africa.

He recalled that the Nigeria was six years ago dislocated and disconnected from the global economy but enthused that today the government has taken bold steps to create a competitive and market oriented economy.

Categories: Africa, Nigeria, Odious Debts

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