It would be helpful if Nigeria’s current efforts to stamp out corruption were rewarded with limited debt cancellation and increased aid by creditor nations, to demonstrate to Africa south of the Sahara that good governance pays.

Nigeria is a giant – Africa’s most populous nation, its biggest oil producer and, as we report from Abuja today, the most spectacular embezzler of public funds. Figures released by the Economic and Financial Crimes Commission (EFCC) reveal that between independence from Britain in 1960 and the restoration of civilian rule in 1999, Nigerians squandered £220 billion. As David Blair, our Africa correspondent, points out, that is almost exactly the total of Western aid given to Africa between 1960 and 1997.

The scale of such theft would seem to make a mockery of the Africa Commission’s proposals for 100 per cent debt reduction and $25 billion of new aid over the next three years. And the timing of the commission’s revelations will be seen as embarrassing for Tony Blair as he prepares to host the G8 summit in Scotland, where Africa, along with climate change, is at the top of the agenda. Yet the fact that the continent’s biggest looter has made public its past crimes gives ground for hope.

President Olusegun Obasanjo served as military ruler of Nigeria during the period surveyed by the EFCC, but as a civilian head of state he has taken four important steps to tackle corruption. He has set up the commission, under Mallam Nuhu Ribadu, and given it teeth. He has appointed the extremely able Mrs Ngozi Okonjo-Iweala as finance minister. He has sacked two members of his Cabinet and the national police chief, all of whom have been charged with malfeasance. And he has set up an excess crude earnings account, into which goes all the revenue earned from oil above the $25 a barrel on which Nigeria bases its budget. With the price over twice that sum, the account holds £4.6 billion. Previously, that excess would have disappeared without trace, the main reason for the country’s egregious level of embezzlement; now it is open to public scrutiny.

Mr Obasanjo has made a start on rooting out a systemic evil. The challenge is formidable in a country where people equate their politicians with thieves and where, apart from the federal government, there are 36 state governments and 774 local administrations, all of which are tempted to take their cut.

On top of that, it is by no means certain that the successor to Mr Obasanjo, who has to step down in 2007, will show the same resolve as he has, and whether the services of Mrs Okonjo-Iweala, a former World Bank vice-president, will be retained.

In the face of that possibility, it would be helpful if Nigeria could be rewarded with limited debt cancellation and increased aid by the creditor nations, to demonstrate to Africa south of the Sahara that good governance pays. Of greater practical, as opposed to symbolic, importance would be the opening of Western markets to local products.

Nigeria, with its long periods of military rule and the deeply corrupting effect of oil wealth, has been the despair of Africa. Under Mr Obasanjo, who oversaw the transition to an earlier period of civilian rule in 1979 and was twice democratically elected in 1999 and 2003, the country has begun to change for the better. If that continues, the potential is enormous. As a businessman told David Blair: “We are a volcano of opportunities waiting to erupt.”

Telegraph (UK), June 25, 2005