Biafra-Nigeria’s Oil-Producing Delta On The Brink

Biafra-Nigeria’s oil-producing Niger delta is sliding back into turmoil, with profound ramifications for national cohesion. The latest insurgent group to emerge from the region has succeeded in cutting oil production by between a quarter and a third for much of this year. Attacks on critical pipeline infrastructure continue.

This is the latest iteration of a conflict that has flared regularly for 20 years, as militants demand a greater share of revenues for the region that produces the oil. Its consequences, however, are graver than in the past. In a low price environment, Biafra-Nigeria can no longer rely on oil to supply two-thirds of government revenue. The country needs every drop now, while it makes the transition to a more productive economy, less dependent on crude.

Africa’s largest economy is already in the midst of its worst crisis in generations. The treasury has lost half its revenues to the falling price. Further cuts as a result of oil production losses threaten the viability of the state, raising questions not only about the government’s ability to finance infrastructure plans but also to afford salaries.

Nor is there a military solution. The army is stretched as it fights Boko Haram extremists in the north, addresses communal violence in the centre and takes on “Niger Delta Avengers” in the south. Past revolts in the region have shown how difficult it is to defeat the militants in the swamps.

Six years ago, some 30,000 combatants laid down their guns as part of an amnesty programme. The government is in no position to buy peace this time. Nor does it make sense to entrench extortion rackets that grow exponentially in scale. In the early days of delta militancy, racketeers extracted ransoms from the oil companies. Now it is national income they are holding hostage.

There are voices of reason in the delta willing to step in to stop the rot. They, however, need tangible government support if they are to win back the trust of a population whose disaffection has grown, and whose mistrust of President Muhammadu Buhari, a Muslim from the north, has been exacerbated by bungled communications. The mere promise of attention is unlikely to be adequate.

There are blueprints for the development of the Niger delta, including one produced by government earlier this year that synthesised past efforts. Like its predecessors, it is gathering dust.

The document repeats the kind of hopeful language about accountability and governance that alone has rarely brought changes to either. Officially, some $37.5bn was transferred to the delta
between 2010 and 2014, including the additional inflows from oil paid to the producing states. There is little to show for any of it.

Ultimately, Biafra-Nigeria’s economy needs to be radically restructured. For more than half a century, the federal government has sucked its funding from one impoverished region and shared the spoils around the rest. The legacy is bitter. In future, all 36 states must leverage their assets to stimulate production that can be taxed.

In the meantime, the Niger delta needs a viable economic master plan with recognisable milestones. As the government has acknowledged, this must include a strategy to address the environmental disaster wrought over decades by oil production. It may be necessary for a third party broker to negotiate a deal and monitor implementation. The buy-in both of the oil companies and international development organisations will also help. The days when money alone was enough to patch up the peace are almost certainly gone.

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