Monday, 28 November 2016

NIGERIA: After a divisive campaign, governing party candidate wins in Ondo State

This week we start with Nigeria's governorship elections and South Africa's President Jacob Zuma facing yet another vote of confidence. Elections in Gambia and Somalia are also due conclude this week as the United States signals greater interest in military action in the Horn.

NIGERIA: After a divisive campaign, governing party candidate wins in Ondo State
Veteran lawyer Rotimi Akeredolu, the candidate for the All Progressives' Congress (APC), has won the crucial Ondo State governorship election held on 26 November. It was the most serious test of the APC's support since it won national elections in March last year.

Despite the victory, the election campaign showed the governing party facing new pressures, with its leading members in the south-west – Bola Tinubu and allies such as Lagos governor Akinwunmi Ambode – refusing to campaign for Akeredolu. The APC's standing has been hit badly in the south-west, which is suffering from the country's worst recession for 25 years.

Akeredolu secured 244,842 votes with the People's Democratic Party's Eyitayo Jegede coming second with 150,380, and Olusola Alexander Oke of the Alliance for Democracy taking third place with 126,889 votes. Tinubu and Ambode's support seemed to swell Oke's vote. Jegede's candidacy for the PDP was confirmed just three days before the elections by the Independent National Electoral Commission but his calls for a postponement of the election fell on deaf ears.

SOUTH AFRICA: Zuma faces no-confidence vote in the ANC's top committee
The African National Congress has extended a meeting of its top decision-making body, the National Executive Committee, until today (28 November) to debate a motion of no-confidence in President Jacob Zuma.

This is far more significant than the parliamentary no-confidence motion that Zuma faced two weeks ago. It exposes deep internal divisions in the ANC. The committee is the only body in the party that has the power to force Zuma out.

Tourism Minister Derek Hanekom originally proposed the motion on 26 November. Several committee wanted a secret ballot so as to avoid possible retribution from Zuma supporters. Party support for Zuma has been hit by successive corruption scandals, especially the report by outgoing Public Protector Thuli Madonsela on 'State Capture', on relations between Zuma and the wealthy Gupta family, and her call for a judicial investigation.

GAMBIA: Opposition alliance challenges Yahya Jammeh at the polls
Businessman Adamu Barrow, backed by eight opposition parties, is taking on President Yahya Jammeh in national elections on Thursday (1 December) after months of state repression. About 50 opposition activists have been arrested in the run up to the elections, including Ousainu Darboe, who leads the opposition United Democratic Party.

Two activists have died in detention and Darboe has been sentenced to three years in gaol for participating in an unauthorised demonstration. On 27 November Jammeh, who seized power in 1994, said that anyone involved in election violence would be dealt with harshly. Jammeh, widely-criticised by pro-democracy and human rights organisations for brutality and corruption, announced last month he would be taking his country out of the International Criminal Court although the current court prosecutor is respected Gambian lawyer Fatou Bensouda.

Jammeh has barred election observers from the European Union but allowed in a delegation from the African Union. Jammeh is expected to declare a comfortable victory although there are signs of opposition to him in the military and opposition parties have mounted a more coordinated campaign this time.

SOMALIA: Lengthy electoral process to conclude as Obama takes action
The voting process to pick a parliament and president is due to end formally on Wednesday (30 November) but has been marred by persistent disruption by the Islamist militia, Al Shabaab. The African Union force, Amisom, has been stretched to the limit defending sites used for voting. The force is currently 4,000 under strength and suffers from poor morale and logistical problems. While Ethiopia has withdrawn troops from Somalia which were not assigned to Amisom, and Kenya and Uganda have questioned their commitment, President Barack Obama has authorised increased US military involvement in the anti-Shabaab campaign, according to a report in yesterday's New York Times.

Obama has deemed Al Shabaab to be part of the armed conflict that Congress authorised military response to after 9 September, 2001. As well as legally underpinning the US military's already expanding role in Somalia, the move lays the groundwork for President-elect Donald Trump to take yet more military action in Somalia and the region.

Monday, 21 November 2016

NIGERIA: Oil and inflation up and politics wobbling

We start in Nigeria where the central bank is holding critical meetings on interest rates and foreign exchange policy. After its budget last week, Zambian officials continue talks with the International Monetary Fund and political tensions rise in neighbouring Congo-Kinshasa. Officials from the Central African Republic are to discuss spending plans after raising pledges worth $1.5 billion at a donor conference in Brussels last week and member states of the International Criminal Court, meeting in the Hague, wind up discussions about the body’s future on Thursday (24 November). Gambia's President Yahya Jammeh, facing a more determined opposition in national elections due on 1 December, has banned European observers.

NIGERIA: Oil and inflation up and politics wobbling
There is a strong possibility of a hike in Nigeria’s base or policy interest rates – to 15% or 16% from the current rate of 14% – after the Central Bank of Nigeria's monetary policy committee meets today (21 November) and tomorrow.

This comes against the backdrop of 'stagflation', weak economic performance but with steadily rising prices. Inflation was 18.3% last month, more than double the central bank's target. CBN directors are to seek the prosecution of people hoarding dollars as part of its plans to step up capital controls.

On the more positive side, the ratings agency Moody's forecasts that Nigeria's economy will grow by at least 2.5% next year if the recent improvements in oil output are maintained. The latest figures from Deputy Oil Minister Emmanuel Kachikwu show that production is back up to 2.1 million barrels a day. This follows a meeting on 1 November between President Muhammadu Buhari and several leaders from the Niger Delta led by veteran politician Edwin Clark.

Further meetings between presidency officials and Delta groups are likely this week. But there is still no sign that the Niger Delta Avengers, the most active militant group this year, will be joining the talks. So far, the talks have discussed extra subventions and investments in the Delta, which have been heavily criticised by the Avengers, who argue that the cash gets diverted by corrupt officials.
There are also signs that the partisan battles in the Delta between supporters of President Buhari and his predecessor Goodluck Jonathan are still raging. Rivers State governor Ezenwo Nyesom Wike has been a particularly fierce critic of Buhari and is seen as a frontrunner to lead the opposition People’s Democratic Party.

ZAMBIA: Will copper boom bail out government in tough talks with IMF?
More discussions between the government and the IMF are likely this week in the wake of the Finance Minister Felix Mutati's budget, announced on 11 November. The IMF is said to want tougher curbs on spending and more accountability on public finances. If these measures are agreed, the two sides would be on course to announce a new IMF programme in January.

Yet the current boom in the world copper price, at its highest level for six years with futures jumping 20% in New York last week, could complicate the talks. President Edgar Lungu may see the prospect of higher revenues from copper and cobalt as a way to avoid the unpopular spending cuts insisted on by the IMF. At the same time, the government is boosting spending on the police in anticipation of protests over the withdrawal of food and fuel subsidies.

Traders differ on how long the copper price boom will last but most say it will not maintain its current momentum. Asian copper buyers have been stepping up purchases, mainly because of plans to increase production of electric cars whose components use substantial quantities of copper and cobalt.

CONGO-KINSHASA: Political crisis deepens as Kabila plans to stay put until 2018
Like neighbouring Zambia, Congo-Kinshasa should benefit from a global copper boom but the country remains mired in its worst political crisis for two decades. Pressure will mount on President Joseph Kabila as the official deadline for the end of his second term of office on 19 December approaches.

Security forces cracked down on an attempt by the opposition alliance, known as the Rassemblement, to organise demonstrations in Kinshasa on 19 November. Police also blocked all routes to the home of opposition leader Etienne Tshisekedi.

These latest attempts to launch street protests follow Kabila's appointment on 17 November of Samy Badibanga, a former ally of Tshisekedi, as Prime Minister. The Rassemblement called Badibanga's appointment a 'non-event'. Opposition activists are expected to regroup this week to plot a more effective plan to force out Kabila, mobilising local support and getting backing from international organisations and foreign governments. 

CENTRAL AFRICAN REPUBLIC: After aid conference, government told to focus on crisis relief measures
This week officials are working on plans for the management of the US$1.5 billion pledged following President Faustin Archange Touadéra's presentation on 17 November of his five-year plan for the country. 

Touadéra was speaking at a special conference convened by the European Union and the United Nations and several non-governmental organisations in Brussels. Reflecting the strong concerns which remain in the wake of recent clashes, several NGOs urged the President to prioritise short-term humanitarian projects.

INTERNATIONAL CRIMINAL COURT: Fight intensifies for the court's future
The United Nations and human rights organisations are urging member countries of the International Criminal Court to stand firm on Article 27 – that is the provision that allows the court prosecutor to issue charges against everyone from ordinary citizens to the President.

Some African countries attending the court's Assembly of State Parties Conference in the Hague, which ends on Thursday (24 November), have been lobbying for immunity for sitting heads of state. This year's Assembly of State parties could prove critical for the court's future.

Botswana, Côte d’Ivoire, Nigeria, Malawi, Senegal, Tanzania, Zambia and Sierra Leone have pledged support for the Court. Burundi, Gambia and South Africa have promised to leave. Many other African countries are sitting on the fence. Last week Russia added its voice to opponents by stating that it would not ratify the 1998 Rome Statute, which established the Court. The United States has still to ratify the Rome Statute, which looks unlikely under Donald Trump's presidency.

GAMBIA: Yahya Jammeh blocks international observers ahead of 1 December elections
Facing businessman Adama Barrow, who is back by eight opposition parties, in national elections on 1 December, President Yahya Jammeh has barred election observers from the European Union. This suggests the election could be much closer than previous contests and that the opposition has a better strategy. But there are also growing fears about violence and rigging in the election. Two opposition politicians have died in state custody this year.

Earlier, the Banjul government had said it would allow in foreign observers and has accredited a team from the African Union. The EU had sent an observer team to the 2011 elections although the regional organisation, the Economic Community of West African States declined to send a team on the grounds that their work would be obstructed.

Thursday, 17 November 2016

Cash calls

African treasuries, cash-strapped after the commodity price crash, are trying to recoup their losses by launching law suits against multinational companies. The most sensational is a court ruling in Chad on 5 October that a consortium led by Exxon Mobil should pay the government a fine of US$73.4 billion for non-payment of royalties.

According to the court, the royalties amounted to 44 trillion CFA francs ($808 million) but Exxon Mobil disputed the payments. Exxon Mobil and Malaysia's Petronas, also in the consortium, have appealed the judgement and are now negotiating with President Idriss Déby Itno's government.

The ambitions of Zambia's state-owned ZCCM Investments are more modest: it is suing Canada's First Quantum for $1.4 bn., claiming the company took an unauthorised loan of $2.3 bn. at below market rates from the Kansanshi copper mine and underpaid its tax bills. First Quantum, which started negotiating with the government after its share price started falling on the Toronto exchange, said the claims were 'inflammatory, vexatious and untrue'.

Uncharacteristically, Nigeria's legal claims are the most modest in the current round of law suits. It is suing Total and Chevron for undeclared oil shipments amounting to over $600 mn. in 2011-14. And it is seeking a further $400 mn. from ENI, Petrobras and Shell for undeclared shipments in the same period.

Tuesday, 15 November 2016

UNITED STATES/AFRICA: Tougher trade deals and isolationism threaten after Trump's win

This week we start again in the United States in search of the implications, direct and indirect, of Donald Trump's shock victory in the presidential election. In South Africa the African National Congress starts its run-up this week to picking its presidential candidate for the 2019 elections.
The legal battle over Guinea's iron ore reserves takes a new turn after it emerged that Rio Tinto has suspended its top executive working on the project. Akinwunmi Ambode, the governor of Lagos, is making himself unpopular with the denizens of Nigeria's commercial capital, just as his ally and political godfather Bola Tinubu appears to be breaking ties with President Muhammadu Buhari.
Although Kenya's economy looks relatively strong as President Uhuru Kenyatta prepares for elections next year, he is pulling the country out of regional security missions in South Sudan and Somalia. Any downgrading of Kenya's security role, amid signs that Uganda might follow suit, poses a serious challenge to the military balance in East Africa and the Horn.

UNITED STATES/AFRICA: Tougher trade deals and isolationism threaten after Trump's winAs the first shockwaves after Donald Trump's presidential election victory on 8 November subside, African policy-makers are looking at three areas of possible disruption this week: capital flows and trade, security, and climate change. Expectations of any economic gains for Africa from a Trump presidency are almost universally low. Africa was scarcely mentioned during the election campaign.

After a period of strong economic growth from 2005-2015, Africa has been slipping down the league table of US commercial interests over the past year. In a world of oversupply of oil and gas and historically low commodity prices, there is unlikely to be any upturn in US investment in Africa, which lags behind that of China and Europe.

Some US economists predict that Trump's planned corporate tax changes and trade protectionism will spook the US markets leading to a crisis as bad as the 2008 financial slowdown. If Trump sharply cuts imports of Chinese and Indian manufactures, that will mean lower demand for the African metals and ores that feed Asia's factories.

African officials fear that Trump will restrict or abolish the African Growth and Opportunity Act (AGOA), the US-Africa trade deal which offers duty-free access to the US market for about US$4 billion of African exports each year. There might also be a review of the Power Africa programme, which is meant to encourage US investment in Africa's electricity industry. However, those big US corporations which benefit from these arrangements will lobby for their survival. African exports to the US are a fraction of the volume of Asian exports, and have little effect on US jobs. But organisations such as the US Agency for International Development will worry about cuts in their programmes to meet Trump's ambitious targets to limit state spending.

There are also concerns that a Trump administration might launch heavy-handed military interventions in Africa – in a new phase of the USA's war on terror – that could exacerbate Africa's mounting security problems.

More effective US diplomatic engagement in Africa looks unlikely if cuts continue in the State Department, which has been losing out to the Department of Defense in recent years. The same can be said of most Western governments whose diplomatic profile in Africa is in retreat in relation to countries such as China, India, Russia and Turkey.

Finally, Trump's rubbishing of the science behind climate change has big implications for Africa. He has pledged to pull the US out of last year's climate change treaty in Paris; that will substantially cut the pot of money available to those countries, many in Africa, hardest hit by global warming.

SOUTH AFRICA: ANC prepares for the post-Zuma worldDespite the storm of corruption allegations, the African National Congress circled the wagons and fought off yet another no-confidence motion against President Jacob Zuma in Parliament on 9 November. Zuma's top aides are resigned to their man facing months of legal battles following outgoing Public Protector Thuli Madonsela's report on improper corporate influence on government.*

This week, at least one state-owned company plans to launch a judicial review of the Madonsela report as part of Zuma's fightback. There are also efforts by opposition parties and civic groups to reinstate the 783 corruption charges against Zuma which were dropped in 2009. In the coming weeks, the government will focus mainly on shoring up economic policy and boosting growth to stop South Africa's creditworthiness being downgraded to junk status by the ratings agencies – a move that would trigger substantial outflows of capital.

And this week ANC will start preparing for a policy conference due in six months and its elective conference to be held before the end of 2017. Given the ANC's continued political dominance in South Africa, the choice of leaders at that conference will be of critical importance. There are at least five contenders to succeed Jacob Zuma, and discreet electioneering is already under way.

Top officials will be talking to the ANC's branches in the provinces, perhaps to influence their choices but also to limit the factionalism that has been scarring the party in recent months. That's a tall order given the high stakes in the coming leadership contest.

GUINEA/MINING: Steinmetz cheered by disarray at rivals in Rio TintoRio Tinto's sale of its 46.6% stake in the giant Simandou iron ore mine to Chinalco for an estimated US$1.3 billion, reported last week, may have looked like a skilful exit from Guinea's troubled mining industry by the world's second biggest mining company. But it hasn't ended the four-sided legal wrangling over the mine's future.

Beny Steinmetz, whose Swiss-based company has been hit by law suits from corporate rivals Rio Tinto and Brazil's Vale, told Bloomberg News last week that the suspension of Alan Davies, who ran Rio's operations in Guinea, would have serious implications. Rio made payments of $10.5 million to consultant François de Combret, a former employee of Lazard Bank in Paris.

'We are the good guys,' Steinmetz told Bloomberg News after hearing of Davies' suspension. So far, neither Rio nor the Guinea government, which stripped Beny Steinmetz's company of its stake in Simandou, has made any public comments about these latest developments in the saga.

NIGERIA: Lagos Governor Ambode makes more enemies as rumblings of discontent grow louder in the south-westThe rumbustious mega-city of Lagos, home to over 20 million people, has been hit by the worsening recession in the country which has brought much of the business in the commercial capital to a grinding halt. Another reason for the malaise in Lagos is the fractious politics. The godfather of the south-west, Bola Tinubu, has been struggling to shore up his influence since Muhammadu Buhari won the national presidency on the ticket of the All Progressives Congress last April.

Although Tinubu's patronage extended to the appointment of some top officials such as the Governor of Lagos State, Akinwunmi Ambode, he is at odds with stars from the south-west such as Power Minister Babatunde Fashola and Mines Minister Kayode Fayemi. Tinubu's relations with President Buhari are also said to be nearing breaking point.

But Tinubu's protégé in Lagos, Ambode, is proving extremely unpopular in the city. Compared with Fashola, the previous Lagos Governor, Ambode's record on service delivery and security is well below standard. At the same time, Ambode has a predilection for bulldozing what he defines as 'illegal structures'. Having ordered the demolition of several buildings housing small businesses and cafés in Ikoyi, Ambode is now targeting the slum areas around the Lagos lagoon which house as many as 300,000 people. Ambode's programme to demolish these areas started last month but is now gathering momentum and could hit serious opposition in the coming weeks.

KENYA: Military starts to withdraw from regional forces ahead of next year's tough electionEast Africa's biggest economy, Kenya, is defying the negative growth trends of much of the rest of the continent – it is projected to grow at an average of 6-8% over the next three years – but it is reining in its military forces in the region. Last month, President Uhuru Kenyatta's government announced it would be pulling Kenyan troops out of neighbouring Somalia as part of a review of the country's security strategy.

And then in the wake of the stern criticism last week of the Kenyan commander of the United Nations peacekeeping force in Juba, Kenyatta's government has announced that it is pulling its troops out of South Sudan.

UN Secretary General Ban Ki-moon had called for the immediate replacement of Lieutenant General Johnson Mogoa Kimani Ondieki, the Kenyan officer who had been commanding the UN peacekeeping force in South Sudan, following a devastating report on the soldiers' failures to protect civilians from attack by rampaging government soldiers.

In a series of attacks in July by soldiers loyal to the South Sudan government, two Chinese peacekeepers were killed and several wounded, several aid workers were raped and a South Sudanese journalist was shot dead. Over 180 buildings in the United Nations compound were hit by shells and rocket-propelled grenades fired by forces loyal to President Salva Kiir. Those targeted by these attacks said the Kenyan-led UN force was missing in action.

Kenya rejected the criticism of Lt Gen Ondieki, arguing that there were organisational problems with the mission beyond the control of the force commander. The troops from China, Ethiopia, Nepal and India were not operating under a unified command.

Monday, 7 November 2016

UNITED STATES ELECTION: What's in it for Africa?

We start off with a look at the increasingly bizarre United States elections tomorrow (8 November), quickly followed by a report on President Jacob Zuma's tough week ahead in South Africa. Then there are fresh doubts about the strategy and money for the African Union mission in Somalia while disqualified presidential contenders get a reprieve in Ghana. Fresh proposals in the talks between the Frelimo government and Renamo opposition are due on 10 November, and many Zimbabweans have already made plain their opposition to the government's plans to start issuing bond notes this week.

UNITED STATES ELECTION: What's in it for Africa?
The lack of enthusiasm in Africa for the US presidential election is palpable: partly because of the candidates, partly because of the lack of attention to Africa, or indeed any foreign policy matters apart from migration and terrorism, in the campaign.

That said, opinion in Africa's media and among political activists overwhelmingly favours Hillary Clinton against Donald Trump. Zimbabwe's former Finance Minister, Tendai Biti, pointed out that Trump's claims of rigging in the US elections gives succour to autocrats everywhere who want to undermine democratic principles. After a year of bad and highly-contested elections in Africa, there is waning enthusiasm for political competition.

African businesspeople interviewed by Africa Confidential share activists' misgivings about Trump for more pragmatic reasons: that he would be likely to cut Africa's quota-free access to the US market and ramp up immigration restrictions.

SOUTH AFRICA: Madonsela's report shakes up the President
The damning findings of newly-retired Public Protector, Thuli Madonsela, in her 355-page report on President Zuma's relations with the Gupta family will reverberate across the political scene this week.
First off, the opposition Democratic Alliance has tabled a motion of no-confidence in parliament on 10 November. There is growing pressure for that vote to be held under secret ballot – as such votes are held in Germany — to allow MPs from the governing African National Congress to vote according their consciences, not party diktat. Given the number of senior ANC officials and supporters who have called for President Zuma's resignation in recent weeks, the vote could be a closer this time. It may also reinforce pressure for Zuma to stand down voluntarily and hand over to Deputy President Cyril Ramaphosa before the ANC's elective conference, due before the end of next year.

Zuma is yet to react publicly to Madonsela's report, other than when speaking to his base in KwaZuluNatal over the weekend he remarked that the courts were undermining democracy in the country.

But Zuma's office will have to respond to Madonsela's recommendations to him and Chief Justice Moegoeng Moegoeng that a Judicial Commission should be set up to examine in detail the claims that Zuma's relations with the Guptas have contravened the law. Moegoeng will need little encouragement: after the Constitutional Court ruled in March that Zuma would have to repay part of the costs borne by the state for the upgrade of his homestead in Nkandla, Moegoeng commented: 'Public office bearers ignore their constitutional obligations at their peril.'

In attempt to prevent the matter dragging on, Madonsela proposed the judicial commission should complete its report within 180 days. The next move is Zuma's but it is difficult to see how he could reject the call for a judicial probe, given his personal involvement in the matter.

SOMALIA: Jihadist attacks derail election timetable and raise questions on future of peacekeeping units
Regional governments with troops in Somalia – Ethiopia, Kenya and Uganda – together with Western powers are reviewing their options following the brief seizure of Qandala in Puntland by Islamic State, or Da'ish, in the week ending 5 November. This follows wider concerns about cuts in European Union funding for the African Union Mission in Somalia (Amisom) and pressure on Britain (which is due to leave the EU after this year's referendum) to step its funding for the mission. Britain will be hosting another international conference on Somalia in the first quarter of next year, its Minister for Africa, Tobias Ellwood, told Africa Confidential.

This week strategists will decide whether to co-ordinate an offensive against the Da'ish contingent in Somalia, which is also at loggerheads with the Al Qaida-affiliated Al Shabaab. We hear that the options US airstrikes against the Da'ish positions, a ground offensive, or both. Puntland President Abdiweli Mohamed Ali Gas has 'declared war' on ISIS. Morale in Amisom is low partly due to financial constraints as the European Union cuts funding, and partly due to a series of deadly attacks launched by Al Shabaab to derail the elections.

Ethiopia has been withdrawing some of its troops in Somalia to help deal with its internal crisis but it insists it will not withdraw the troops assigned to Amisom for now.

This comes a particularly bad time for the elections for a new legislature and president which are running several weeks behind schedule. It's now looking unlikely that there will be a new parliament in place to elect a new President on 30 November as the current timetable dictates.

GHANA: Disqualified presidential candidates given a second chance
The High Court in Accra ruled today that 12 of the 13 presidential candidates who had been disqualified due to errors in their nomination forms are to be given another two days to correct them. Speaking in London on 4 November, Charlotte Osei, Chairwoman of the Electoral Commission, said she didn't think that a short extension of the nomination period would mean a postponement of the presidential elections due on 7 December.

Timing of the presidential election could prove a sensitive matter, especially given the opposition candidates' shortage of funds and their problems in sustaining a longer campaign.

MOZAMBIQUE: As economy stutters, another round of political talks
Despite the 8 October assassination of Jeremias Pondeca, a member of the Renamo negotiating team with Frelimo, the efforts of the mediators continue. On 10 November, they present their plans for some form of regional powers for Renamo, to the joint commission.

Last week, financial ratings agencies judged Mozambique to have the most unsustainable debt obligations in the world, worse even than Venezuela's.

ZIMBABWE: Detested bond notes on the streets this week
President Robert Mugabe's government is due to go ahead with the issue of $200 million worth of 'bond notes' – backed by the Reserve Bank but not convertible in international currencies – this week.
Opposition parties led by the Movement for Democratic Change are due to organise protests against the notes, describing them as a covert means of reintroducing the Zimbabwe dollar.

There are questions about the timing of the move as the supply of US dollars in the market continues to shrink. There were hopes that more use might be made of South Africa's rand as an alternative currency following a meeting between Presidents Mugabe and Jacob Zuma in Harare last week.
But there has been no official comment about a new agreement to boost the use of the rand in Zimbabwe. Currently less than a tenth of sales in Zimbabwe use the rand.

Despite its reported support for the bond notes issue, Afreximbank, an affiliate of the African Development Bank has made no public statement on the launch of the notes. Rumours of counterfeit bond notes in circulation have not increased confidence in the issue.

Thursday, 3 November 2016

Buhari's Delta plan

It was hardly a meeting of minds but President Muhammadu Buhari's discussions with Niger Delta state governors and community leaders in Abuja on 1 November marks a clear change of strategy. It was Buhari's first meeting with regional leaders since militants of the Niger Delta Avengers started attacking pipelines and production platforms in January, eventually cutting oil production by a million barrels a day. Oil ministry officials claim production is back up to around 2 mn. barrels.

The government is set to launch a new strategy of negotiations with grassroots organisations and a US$10 billion investment programme for education, health services, training and jobs. Deputy Oil Minister Emmanuel Kachikwu says much of the funding would come from outside the state treasury, mainly from local and international oil companies. But he concedes it will be difficult to raise substantial funds without getting the National Assembly to approve long delayed reforms to the oil industry.

Delta activists have told Buhari's officials there is little chance of stopping the militant attacks if military operations continue to be run by corrupt officers who benefit from various oil theft and piracy schemes. The first stage of the government's Delta strategy will be dominated by the US$200 mn. clean-up of Ogoniland, due to start in early 2017 with an initial group of projects costing $10 mn. It will be a critical test of the government's new policy in the Delta.