Thursday, 2 March 2017

Go on with one Nigeria 2: 'Use the huge oil rigs to benefit a minority'

Nigeria is an oil economy, but not well used. The country devotes enough resources to security. The benefits 'accrue to the people in power and their patronage system'. Photo: Google Images.

"It could be a more prosperous economy where oil did what it's done in Norway and lift the whole economy up, because it's well used. The starategy has been to use these huge oil rigs to benefit a minority which is the elite and the patronage system. The elites are not bothered to grow an economy that grows towards a modern economy that is inclusive"- Prof. Sir Paul Collier; Oxford University.

The people who benefit from the way things are have made it impossible to have an inclusive society. The country and it's leadership does not believe in growth for all.

Repression is too successful as the government has enough resources to support the security agencies. "The benefits are very big relative to the benefits of going for the inclusive strategy, growth for all".
The system benefits just only the elites.

Another factor is the hetrogeneous characteristics of the country resulting in a huge distrust so protests are politicised and treated with suspicion as regional /ethnic undertaking to undermine the federal government.

This also lends very strong support for  reforms/restructuring; regional autonomy for inclusiveness.

"Norway being a homogeneous society has built an enormous level of trust".

 According to Prof. Alexander Cappelen,of Norwagian School of Economics: "High levels of trust make economic growth easier..., While other countries have struck oil and then binged on the revenues, by contrast Norway is continuing to invest its oil and gas money in a giant sovereign wealth fund.

There are few displays of ostentatious spending .We had to invest a lot of money before we could spend anything. Norway is happy to save its wealth and shrug off the temptations of a luxury life. He concluded: "For this kind of a system to work you need to have an enormous level of trust. Trust that money isn't going to be mismanaged , that its not going to be spent in a way you don't like"

[How Norway has avoided the 'curse of oil'- Sarah Treanor, BBC;]

The Wealth of a Nation: How Norway Escaped the oil curse. "While oil may be a cause of corruption and unaccountable government in many countries, Norway has been able to set aside its resource wealth to invest in the countries future. "
Each time there is a major oil discovery in Norway, the population benefits, not just the government or the elites but all norwegians"

See also : Senate Probes NNPC for non-remittance : N5.1 trillion revenue

New Twist in Malabu Oil deal as Adoke implicates Obasanjo, Yaradua, Jonathan

"In oil economies a pricier barrel is not synonymous with economic well-being, neither is it a guarantee of political stability, institutions determine whether oil is a blessing or a curse"-Peter Kaznacheev.
[Higher Oil Prices alone won't rescue failing petro-  states like Venezuela]

Uche Okeke currently participates at the first MOOC on Economic Development; Oxford University,UK.

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