Nigeria

Part of the debate – in the House of Lords at 7:03 pm on 18 April 2006.

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Photo of Lord Howell of Guildford Lord Howell of Guildford Shadow Minister, Foreign Affairs, Deputy Leader, Parliament, Shadow Minister (Foreign and Commonwealth Affairs), Shadow Deputy Leader of the House of Lords 7:03, 18 April 2006

My Lords, I share the gratitude expressed by other noble Lords to the noble Viscount, Lord Waverley, for initiating this debate at a very good time. I also join with others in sending my best wishes to the noble Lord, Lord Avebury, for his early recovery. We miss him in precisely this type of debate where he always speaks with great expertise.

The timeliness of this debate is reinforced by events over the Easter weekend. On the one hand, the IMF executive board met yesterday to finalise the ratification of the policy support instrument approved for Nigeria in October last year. That was one story. On the other hand there were over the weekend, and continue to be even today, reports of renewed and, I am afraid, bloody unrest, between the various groups, which all add to the miserable total of more than 20,000 deaths that are said to have occurred in the country since President Obasanjo's election in 1999. These two differing messages—the one positive and the other, sadly, negative—provide a backdrop to what has been undoubtedly a very interesting and useful debate, with knowledgeable contributions that one would expect from all sides of the House. That leads me to my first question for the Minister—and I know that he will seek to answer these questions. What assessment have we made of this renewed violence over the weekend, and the peace demands made by the Ijaws, which are the largest ethnic group in the delta region?

Against that background, we have to look at Nigeria in the world scene. This morning in New York, crude oil prices rose again, well above the $70 a barrel level, and the markets in contango—that is to say the futures prices—are even higher. We have not yet reached the levels in real terms of 1983 and 1984, during the great oil shock of that period following the fall of the Shah in Iran, but we are getting quite near. These prices are being pushed higher and higher by concerns about supply disruptions in Nigeria among many other things. The tension over the Iranian nuclear programme is contributing, as are the disruption in Venezuela, the problems in Sudan, the political problems in Russia and the continuing incidents of sabotage in Iraq, where oil production is running at anything between 1 million and 2 million barrels fewer than many people had hoped that it would be by now.

Nigeria is the world's eighth largest oil producer, the largest in Africa—and it will be, as the right reverend Prelate the Bishop of Coventry reminded us, one of the major exporters of liquid natural gas—that is, frozen gas—and, presumably, even of gas-to-liquid products, or GTL, in future. That will be the chief fuel of northern Europe for many years to come, so there is an important practical reason, quite aside from all the other reasons, why we should be very concerned with what is happening. Sadly, in Nigeria exports of oil have been cut back by sabotage and other attacks. The right reverend Prelate referred to one-fifth or almost one-quarter of oil exports being cut; the figure that I have is about 0.5 million barrels a day, which would be between one-fifth and one-quarter. But at any rate a big chunk of oil is being shut in and not exported as it should.

Tragically, despite these enormous oil and other mineral resources, Nigeria is currently ranked down at 151 out of 177 countries in the human development index of suffering from extreme poverty. I find that very hard to get into my mind. Incredibly, despite being oil-rich, it is among the 20 poorest countries in the world in terms of per capita income, with 75 million out of 140 million people living in absolute poverty. Of course those who suffer most are the small children, as usual, one in five of whom dies before reaching the age of five, while 12 million of them are not in school—and there are nearly 2 million AIDS orphans.

So there is a good story for the future—and, let us hope, the basis for development; but there is also the sad story of yesterday, which is that one of the potentially richest countries in Africa is not as stable as it should be, still suffers, as your Lordships have rightly observed, from intense corruption, and still has to live with criminal networks that are currently stealing an estimated 300,000 barrels of oil a day, leaving oil income per capita at a miserable 30p per person. So here is the greatest country in Africa, full of rich potential and ready to act as a stabilising anchor for the rest of the region, but not yet in the position to do so. This is an example of the syndrome of the curse of oil, a dreadful reminder that huge flows of revenue from oil, rather like huge flows of unsuitably focused development aid, do not lead to development; they lead to the opposite. They entrench governments and corruption, and actually paralyse development.

What are the keys we should be trying to find to turn the situation around and reinforce the points made by the noble Viscount, Lord Waverley, about a more positive era now developing? Obviously good governance and transparency are the key. Endemic corruption and decades of military misrule resulted in steadily increasing debt and worsening socio-economic indicators. We all recognise the significant steps President Obasanjo has taken towards reforming the country since 1999—it has undoubtedly come a long way—including the Economic and Financial Crimes Commission and the fight against corruption, but it is a puzzle that that same president now wants to amend the constitution to give himself the third term he said he would not take. Clearly that is adding to the lack of confidence, and one wonders what word we, as friends of Nigeria, have passed to the president about how he should handle this delicate situation. It is not for us to interfere from outside, that is fair, but we are all members of the Commonwealth and have common standards, and we are entitled to a view.

The noble Lords, Lord Lea and Lord Chidgey, mentioned the story over the weekend about the gap between the money the oil companies say they are handing over to the Government and the amount the Government's central bank says it actually receives. These are unhealthy figures, and the whole story needs to be brought out and made more transparent if confidence is to be restored.

I am sure we are all increasingly aware that new players are on the scene in Africa. The biggest new player is of course China, which has an increasing involvement everywhere. There was a report only today that China and Russia are playing a different hand as far as Sudan is concerned, where China has huge oil interests, and are blocking sanctions against Sudanese officials accused of involvement in Darfur violence. The Chinese Foreign Minister was saying only the other day that he regarded his country's involvement in Nigeria as operating on the principle that,

"We try to separate politics from business".

One wonders what links, exchanges and dialogue we are developing with these great new powers in the world—namely, China and the other Asian powers—as they pursue their agenda. Are they on board, as it were, in terms of a joint approach to the work of the UN regarding human rights? Are they acting as positive, responsible nations that want peace, as they keep saying they are? If they are, should we not co-ordinate more closely with them, and not think of ourselves just as part of a western world that has separate interests from the Asian world? After all, we do not; we all have the same interests, increasingly, in Africa.

In my allotted time I can touch on only some of the issues affecting this enormous country, which could be the keystone to stability in the whole region; indeed, almost in the whole continent. I appreciate what the noble Viscount has reminded us of, that all is not doom and gloom in this part of Africa. But with the renewed violence, sabotage and the loss of oil, there is a feeling that one step forward often leads to one step back and that no progress is made—in fact, living standards continue to fall in some areas.

We have one overriding and binding link with this great country. We and Nigeria are both members of the Commonwealth network, which is proving to be the kind of organisation and pattern far more suitable to the 21st century than the traditional blocs and institutions that were created in the last century. It is in our direct interest to see Nigeria stabilised and fulfilling its massive potential for Africa and the world, and that is what we must all work for, in the right way. I hope we will do so.