Executive Intelligence Review
This speech appears in the June 1, 2001 issue of Executive Intelligence Review.
PROF. SAM ALUKO

Peace Through Development:
The Nigerian Perspective

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Sam Aluko is a Professor of Economics who lives in Akure, in Ondo State, Nigeria. He served in the Economics Ministry of the Nigerian government for four years during the early 1980s. He delivered the following address to a conference panel entitled "Peace through Development in Africa: The Moral Challenge for Europe," on May 5.

I appreciate the invitation extended to me by the Schiller Institute, not only to attend this very important conference, but also to contribute to the discourse on economic recovery as a vehicle for the sustenance of peace, in a world that has become increasingly bedevilled with financial, economic and moral crises, in spite of the increasing and new and complex technologies which are daily being made available to mankind.

There is hardly anywhere in the world today, where the financial, economic, and moral crises are more evident, widespread, persistent, and likely to continue, than in the African continent. Since about one out of every six Africans lives in Nigeria (in fact, because of the dispersal of Nigerians throughout the African continent, about one out of every four or five Africans is a Nigerian), whatever happens in Nigeria has a very significant impact on the African continent.

One of the most evident characteristics of the African continent is that it has always been a "follower continent"; that it continues to remain a "follower continent"; and, unless it finds faith and independence in its own peoples, action, and governments, Africa's continuing economic decline, its financial and moral crises, will not only increase and deepen, but will also ultimately constitute a threat to the peace and stability of the entire world. This is because the enormous economic and natural resources of the African continent will continue to invite the competitive exploitation and spoliation of today's world's most developed nations, as their diminishing resources recede further and further while their insatiable appetites grow more gargantuan by the day, and the financial and economic crises which are beginning to manifest in their countries deepen and defy solution.

It is significant that it was in the heart of Germany, where this conference on economic growth and world peace is being held, that the then few great powers of the world, at the Berlin Conference in 1884, decided to partition Africa and set it on its road to economic disintegration, political enslavement, and moral degeneration. Before and since then, Africa had gone through the pangs of slavery, colonization, economic domination, imperialism, neo-imperialism, European metropolitan peripherilization, and political manipulations that had led to and continue to sustain intra-ethnic and inter-ethnic wars and violence, aided, abetted and sustained by the technologies, weapons and propaganda of the powerful nations of Europe and America.

`Follower Continent'

As one of the privileged Africans, who have had the benefit of education and close and sustained interaction with Europe and America, I lay the main blame on my own African peoples. First, the blame on my African ancestors who, for a little inducement of gunpowder, money, and materials, sold our young and vibrant Africans into slavery and colonialism, and now, for money, wealth, and power, continue to sell the conscience of the continent to the ideas, philosophies, and inducements of the West—to the extent that the whole of the African continent today owes the West and its finance capitalists, debts that are almost thrice the gross domestic wealth of the continent. Africa has reached the present lackluster morass because its leaders have always been blind followers of the West, which is why I have called Africa, the "follower continent."

When slavery was popular in the world, African leaders readily embraced it as a vehicle to wealth and power. When colonialism replaced slavery, African leaders readily pawned their kingdoms, dukedoms, and empires to the colonizing powers. When colonialism became discredited and communism/socialism/capitalism became the dominant competing ideologies in the West, African leaders readily embraced one variant or the other of communism, socialism, or capitalism. Now that communism and socialism have been virtually killed and exterminated by the West, epitomized by the U.S.A., and substituted with free trade, liberalization, deregulation, privatization, globalization, and other capitalist shibboleths, African leaders and governments have followed these "sing-songs" as their cardinal ideologies to economic development, political resorgimento, and resurgence.

When the West extended the carrot of loan capital to the African leaders and governments, they followed readily, and ended up in the web of the International Monetary Fund (IMF), the World Bank, the Paris Club, and the London Club of Creditors who now virtually run the African governments, with ready acquiescence and following by the African leaders. I need recount no more because the leaders of this Institute, and particularly Dr. LaRouche, have been in the forefront of exposing the designs of these world finance capitalists and their designs against not only the economies of the poorer segments of the world, but also particularly of the African governments.

Failure to Plan for Economic Growth and Peace

It is often said, and wisely too, that, "no one plans to fail, but many fail to plan." This is exactly what is happening in most countries in Africa today. Let me use Nigeria as a veritable example.

When the British Empire was in control of the politics and the economy of Nigeria, it encouraged and instituted "Development Plans" for the economy. The first was the Ten-Year Development and Welfare Plan, 1946-55; followed by 1955-60-62. When Nigeria became independent in 1960, it still continued with the 1962-68, 1970-75, 1975-80, and 1980-85 Development Plans, but with diminishing commitments to planning. The Colonial Plans were mainly designed to ensure a more coordinated harnessing of the vast Nigerian natural resources for British interests, manufactures, and commerce. Marketing Boards were established for cocoa, rubber, palm produce, cotton, and groundnuts, among others, and Government Corporations were established for the vast mineral resources of Nigeria, for energy, and, later for petroleum oil.

But as the hold of the West became less and less on the Nigerian resources, the economists and the political powerbrokers of the West began to adumbrate consistently and with manipulated statistics, that the Marketing Boards were exploitative of the local farmers; that the corporations were a restraint on trade and efficiency; that the public-sector management of the economy was corrupt and undesirable; and that the government "had no business in business" but should deregulate and privatize the boards and the corporations.

In 1986, the IMF/World Bank succeeded in convincing the then Nigerian military government into adopting their Structural Adjustment Program. The Marketing Boards were disbanded; public enterprises were deregulated; government intervention in the economy became discredited; monetary and fiscal policies of government were relaxed, and the free traders took over the reins of government. The result was that cocoa production in Nigeria fell from about 400,000 tons a year in 1986 to 150,000 tons in 2000, and the production of cotton, groundnuts, hides and skin, rubber, and palm produce decreased to between 25% and 35% of the 1986 level. Coal production fell from 360,000 tons in 1980 to 19,000 tons in 2000. Per capita income of Nigerians fell from $760 per annum in 1985 to $360 in 2000. Food imports replaced food exports. The value of the naira, Nigeria's currency, fell from N1=$1 in 1985, to N115=$1 today, at the Central Bank exchange rate (Table 1).[FIGURE 11] Black marketing in the nation's currency began and grew since 1985, to become N140=$1 today.

The IMF/WorldBank and their Western sponsors have now stated, with the approval of Nigeria's Central Bank, that the naira is even overvalued at the existing rate of exchange. The IMF has pencilled the naira at N550=$1 as its real market rate of exchange. Ghana, whose cedi was of the same value as the naira in 1980, now has the exchange rate of the cedi at 6,750 cedi=$1. Ditto in almost all the countries of Africa.

The foreign debt overhang in Nigeria increased from zero in 1960, to $1 billion in 1979, $11.5 billion in 1986, $33.2 billion in 1990, and $35 billion in 2000—about $18 billion of which was the current accumulated interest. In actual fact, Nigeria borrowed about $17.5 billion between 1979 and today, repaid about $33 billion during the period, and is still owing $35 billion. Nigeria's debt is, today, estimated at about 82% of its Gross Domestic Product.

The IMF/World Bank, the Paris Club, and the London Club of Creditors (the Paris Club is the same creditor countries when they act as governments, as the London Club countries when they act as bank lenders), have involved Nigeria, like other African debtor countries, in debt-rescheduling, debt conversion, debt-buyback and deferred payments; all of which had exacerbated the debt burden, rather than debt relief or debt cancellation which the Nigerian governments hoped would be granted, if they continued to follow the prescriptions and the economic dictates of the creditors. As Nigeria became poorer and poorer, its leaders became more and more criminalized; lost more and more confidence in themselves and in the economy; and increased the keeping of their wealth, much of which was stolen or taken from the economy, in the banks, or invested it in the economies of the West, with the active encouragement or connivance of the West.

Nigeria is now being propelled to democratize as a way to economic recovery. But with every passing day since the military was replaced with a "democratic" regime in May 1999, the life and living conditions of the average Nigerian continue to deteriorate, with the hope of an economic recovery becoming more and more distant. But our government continues to follow the dictates of the West, with privatization, deregulation, liberalization, minimization of government involvement in the economy; retrenchment in public-sector employment; belief in a private-sector-led economy, even though the production sector itself is depressed, functioning at about 30% of its executive capacity, today, compared with 75-80% in 1985. The rate of interest has risen to 50% per annum, when the rate of return is less than 1.015%, if the products are sold at all, since the purchasing power of consumers has considerably reduced. The result is that Nigeria is now flooded with second-hand goods, low-quality or fake products, dumped and heavily subsidized foreign goods, from toothpicks to the most sophisticated equipment from the West and Asia. These further depress the few surviving industries in Nigeria and send them out of production. In 1999 alone, over 4,000 small and medium enterprises folded up in Nigeria.

The catalogue of economic woes can be multiplied ad infinitum in Nigeria. Yet, Nigeria is still regarded in Africa as one of the few resilient economies that are surviving the onslaught from the West.

The Future and the Prospects

Rather than have our own original ideas and chart a new path for development, the present regime, with all its good intentions, aided and abetted by the West, has made anti-corruption crusades its main vehicle of economic growth and development. It has enacted a stiff anti-corruption law which is not materially different from what had long existed in many countries of southern Africa, Egypt, Algeria, etc., where corruption has increased. The regime seems to forget that most of the Western countries developed on corruption, both internally and internationally. The difference between the corruption of the West and Africa's, is that while that of the West was internalized and productive, ours in Africa had been, and continues to be externalized and destructive. There is no political system, democratic, oligarchic, dictatorial, republican, or monarchical, that had not been corrupt in varying degrees, Germany inclusive.

Therefore, Nigeria, like Africa, must return to itself: find its own views; chart a different economic path from deregulation, privatization, globalization, and liberalization, and use its government as the main engine of growth through planning and control of its exchange rate, its rates of interest, and the pursuit of full employment for its citizens, by mobilizing both the public sector and subsidizing the private sector in that direction. Otherwise, the new slavery emerging in Nigeria will be worse than that of the 16th, 17th, and 18th centuries' slavery in Africa.

Then, the slave traders bought the African illiterate youths from their captors, rulers, and leaders, and took them to the plantations in Europe, Oceania and the Americas. Today, millions of well-trained and professional Africans daily besiege the Western embassies, High Commissions, and Legations in Africa to pay highly for visas to enter Europe, America, including Canada and Oceania, in order to perform the slave-like and menial jobs, including prostitution, in these same countries, at the expense of Africa's economic fortune and honor.

Nigeria and Africa must pursue a new and different program of economic reform from the current prescriptions of the IMF/World Bank and their Western collaborators.

In order to achieve a modicum of economic growth that will meet the aspirations of Nigeria, and of Africa, a Marshall-type program for Europe, and, preferably a [Franklin] Delano Roosevelt type of economic recovery program for the U.S.A., must be formulated, adopted and executed. Otherwise, the dichotomy between the rich and the poor in Africa will intensify, increase the simmering and growing tensions, crises, and wars in Africa. Such a situation will increase the conflict between Africa and the West. Just as a country cannot remain at peace, half-slave and half-free, so the world cannot remain over-developed and under-developed, and hope to have and sustain peace.

Thank you.

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