Mentor adds to Nigeria president’s woes amid missing $50bn
The in-tray of Goodluck Jonathan, Nigeria’s president, has been filling up with some potent mail in recent weeks. In just over 24 hours two letters have leaked, one from the central bank raising questions about the whereabouts of $50bn in oil revenues, the other a broadside from a former head of state, Olusegun Obasanjo.
Both have combined to cast a pall over Mr Jonathan’s presidency at a time of rising political tension and concern over the state of government finances ahead of elections in 2015.
As head of state and leader of the ruling People’s Democratic party, Gen Obasanjo was instrumental in Mr Jonathan’s ascent to the top. He has often argued that it was vital in the interests of preserving Nigeria’s multi-ethnic federation and quelling militancy in the oil-producing Niger delta to prove that someone from that region – Mr Jonathan’s – could reach the top.
But under the heading “before it is too late” he has sent a withering assessment of his protégé’s rule, effectively calling on him in a letter leaked to the media to stand down ahead of the 2015 polls in the interests of party and national unity. Likening the current situation to the dark days in the 1990s when General Sani Abacha’s brutal and corrupt rule stretched Africa’s most populous nation to breaking point, he implies that Mr Jonathan has put ethnic and personal interests above those of the nation.
Over 18 pages, he lists a string of abuses allegedly taking place from billion-dollar fraud in the oil industry to the use of security agencies for political ends. He implores Mr Jonathan to stick to what he says was an original promise not to seek a second term as president.
The issue of his second term has contributed to dividing the ruling party in recent months, prompting a faction of state governors, most of them from the predominantly Muslim north to defect to the opposition. “If on the altar of the party you go for broke, the party may be broken beyond repairs. In such a situation Nigeria as a nation may also be adversely affected, not just the PDP. I wish to see no more bloodshed occasioned by politics,” Gen Obasanjo writes.
Contacted by the FT, the former head of state, who stood down in 2007 after serving two terms as elected president, said he had felt compelled to send the letter out of “serious concern” about the direction in which Nigeria is heading.
Presidential spokespeople contacted by the FT were not on hand to respond. But an ally of the president said: “I don’t know why he has done this. He must be frustrated that he doesn’t have the influence he used to have . . . For him to stand up and be the moral conscience I don’t think too many people will buy into that. I see a lot of people who will call him a hypocrite.”
Separately a letter from the Central Bank of Nigeria suggests that the state oil company has failed to account for nearly $50bn in crude oil sold between January 2012 and July 2013 that should by law have been remitted to government coffers. The alleged shortfall amounts to 76 per cent of crude oil sold by the NNPC and is nearly equal to federal budget expenditure for both years. The NNPC has rejected the allegations.
Lamido Sanusi, the CBN governor, declined to comment on the letter. In it he says he felt obliged to write to the president documenting the “continued failure of the NNPC to repatriate significant proportions of the proceeds of crude oil shipments it made in gross violation of the law.” He wrote that he had been warning the president of this since as far back as 2010.
Mr Obasanjo also refers to 430,000 b/d of oil which he alleges have not been remitted to federal coffers. “Please deal with this allegation transparently and let the truth be known,” he pleads.
Huge shortfalls in oil revenues, which typically account for 80 per cent of government revenue, have periodically come to light in Nigeria’s past. However, the combined sums involved in Mr Sanusi’s calculations and Gen Obasanjo’s allegations dwarf previous controversies over the opaque nature of the oil industry in Africa’s leading producer.
Both letters have surfaced at a time when President Jonathan is under growing public pressure for his perceived failure to tackle corruption and act on the findings of a series of state-sanctioned investigations pointing to gross mismanagement in the oil industry. In a statement, the NNPC denied it had withheld payments and said the CBN’s information was “misleading” and “capable of creating public disaffection.”
“The allegation is borne out of misunderstanding of the workings of the oil and gas industry and the modality for remitting crude oil sales revenue into the Federation Account,” the statement said.
The 24 per cent of total crude oil earnings the CBN acknowledges receiving represents the full amount due from the NNPC’s share of sales, the statement added. The remainder could be accounted for in field development costs as well as from the receipts collected by other government agencies.