When John Taylor, as the United States Under-Secretary for International Affairs, presented a report in 2004 titled ‘Grants and Sovereign Debt Restructuring’ to the U.S. Joint Economic Committee, a number of issues arose. One of such issues was the possibility of misapplication of foreign loans by developing countries, whereby future generations pay the penalty for such lapses. Taylor’s prescriptions included a ban on loans which, he said, can be misappropriated by those who manage such loans. Rather, grants tied to specific performance should replace loans, as a check on squandering of resources.
There is hardly any doubt that loans had been mismanaged and appropriated by those who managed them in the past. Nobody needs to be reminded that money, being such a good soldier, is the primary means used by the political class to recycle their kinds in government. This recycling mechanism is a security strategy intended to keep their secrets secret and perpetuate their class. There is an old legal maxim that laws are made by superiors for inferiors to obey. Consequently, the ‘superiors’ in the Nigerian society who make or mend the laws are rarely subject to the stings of the law or, at least, not in the same degree as the ‘inferior’ citizens. Superiors rarely commit class suicide.
The first step in the creation of a class or power structure is usually the accumulation of wealth, followed by keeping the ‘inferior’ ones in check through intimidation. Through this means of social engineering, predators, hawks and philistines soon emerge as members of the ruling and political class. There is more to a nation’s debt hang-over and management of loans than what the average citizens would know. Apart from the fact that there are loans that can hardly be accounted for properly, close to 50 per cent of such loans arose from dubious and fraudulent deals by individual Nigerians. Since international trade recognizes and survives on credit facilities, every nation serves as the guarantor for its entrepreneurs and organizations doing business with foreign countries.
Several Nigerian private entrepreneurs and organizations not only defaulted in the terms of trade agreements, but also dealt fraudulently. This is a brief genesis of a good part of Nigeria’s foreign debts. Prejudices which the international community have for Nigeria arose largely from defaults and frauds in trade agreements by Nigerian business entrepreneurs. It is a fact that foreigners also collaborated in these shady deals. The logic is that since Nigerians themselves want to destroy and undermine their country’s interest, then why not help them do so? Especially since such foreigners also benefit in such deal, the logic is that the nation can be allowed to bleed to death through foreign debts. Those involved in such deals are not the inferior citizens.
It is expected that those who have several ugly skeletons in their closets and foreign banks would stop at nothing to see that the table does not turn against them. One of the ways to do so is to stay on in power, be the sponsors and godfathers of those who get to power and then perpetuate this class of rulers through a recycling process. Consequently, electoral fraud becomes a part of the survival game in which ‘inferior’ citizens have no say or power. Thus, the ‘superiors’ who make the law must be protected by the law in spite of their private crimes.
What brings about the depletion of the nation’s foreign reserves? What do we have to show for the huge loans taken in the past and what brought about the non-performance or collapse of the projects for which such loans were taken? Who are those that have the clout and means to buy over privatized public assets that became too cumbersome to manage?
While we may boast that we are out of recession and debt traps, how much liabilities are we passing on to future generations? Over 20 years ago, a 70-year-old Mexican, disillusioned with his country’s leadership once said: ‘Anyone who thinks life will get better is a dreamer, because, every president here has been a liar and a thief, and this one is too’. He was not arrested for making that statement but he added that he wanted future generations to hear what he said when he was hungry and angry.
Dr. Amirize is a retired lecturer at the Rivers State University, Port Harcourt.