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U.S. Department of State

Diplomacy in Action

Nigeria (08/00)


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For the most current version of this Note, see Background Notes A-Z.

PROFILE

Official Name:
Federal Republic of Nigeria

Geography
Area: 923,768 sq. km. (356,700 sq. mi.) about the size of California, Nevada, and Arizona.
Cities: Capital--Abuja (pop. est. 100,000). Other cities--Lagos (12 million), Ibadan (5 million), Kano (1 million), Enugu (500,000).
Terrain: Ranges from southern coastal swamps to tropical forests, open woodlands, grasslands, and semidesert in the far north. The highest regions are the Jos Plateau 1,200-2,000 meters above sea level and the mountains along the border with Cameroon.
Climate: Annual rainfall ranges from 381 cm. along the coast to 64 cm. or less in the far north.

People
Nationality: Noun and adjective--Nigerian(s).
Population (est.1999): 100 million.
Total fertility rate (avg. number of children per woman): 6.0. Ethnic groups (250): Hausa-Fulani, Igbo, and Yoruba are the largest.
Religions: Muslim, Christian, indigenous African.
Languages: English (official), Hausa, Igbo, Yoruba, others.
Education: Attendance (secondary)--male 32%, female 27%.
Literacy--39%-51 %.
Health: Life expectancy--56 years.

Government
Type: An elected civilian government took office on May 29, 1999, following 15 years of military rule.
Independence: October 1, 1960.
Constitution: The 1979 constitution was suspended after 1983, the May 3, 1989 constitution never implemented, and the 1999 constitution (based largely on the 1979 constitution) was promulgated by decree on May 5, 1999. The 1999 constitution came into force on May 29, 1999.
Subdivisions: 36 states plus Federal Capital Territory (Abuja); states divided into a total of 774 local government areas.
Total government expenditure: $9.47 billion.
Defense: 10% of 1996 budget.
Flag: Green, white, green, three vertical bands.

Economy
GDP (1998 est.): $36 billion.
Estimated real growth rate (2000): 2.7%.
Per capita GDP (1999 est.): $300.
Inflation (2000 est): 6.6 %.
Natural resources: Petroleum, natural gas, tin, columbite, iron ore, coal, limestone, lead, zinc.
Agriculture: Products--cocoa, palm oil, yams, cassava, sorghum, millet, corn, rice, livestock, groundnuts, cotton.
Industry: Types--textiles, cement, food products, footwear, metal products, lumber, beer, detergents, car assembly.
Trade (1997): Exports--$15.2 billion: petroleum (98.4%), cocoa, rubber.

PEOPLE
The most populous country in Africa, Nigeria accounts for one-quarter of West Africa's people. Although less than 25% of Nigerians are urban dwellers, at least 24 cities have populations of more than 100,000. The variety of customs, languages, and traditions among Nigeria's 250 ethnic groups gives the country a rich diversity. The dominant ethnic group in the northern two-thirds of the country is the Hausa-Fulani, most of whom are Muslim. Other major ethnic groups of the north are the Nupe, Tiv, and Kanuri. The Yoruba people are predominant in the southwest. About half of the Yorubas are Christian and half Muslim. The predominantly Catholic Igbo are the largest ethnic group in the southeast, with the Efik, Ibibio, and Ijaw (the country's fourth-largest ethnic group) comprising a substantial segment of the population in that area as well. Persons of different language backgrounds most commonly communicate in English, although knowledge of two or more Nigerian languages is widespread. Hausa, Yoruba, and Igbo are the most widely used.

HISTORY
Before the colonial period, the area which comprises modern Nigeria had an eventful history. More than 2,000 years ago, the Nok culture in the present Plateau state worked iron and produced sophisticated terra cotta sculpture. In the northern cities of Kano and Katsina, recorded history dates back to approximately 1000 AD. In the centuries that followed, these Hausa kingdoms and the Bomu empire near Lake Chad prospered as important terminals of north-south trade between North African Berbers and forest people who exchanged slaves, ivory, and kola nuts for salt, glass beads, coral, cloth, weapons, brass rods, and cowrie shells used as currency.

In the southwest, the Yoruba kingdom of Oyo was founded about 1400, and at its height from the 17th to 19th centuries attained a high level of political organization and extended as far as modern Togo. In the south central part of present-day Nigeria, as early as the 15th and 16th centuries, the kingdom of Benin had developed an efficient army; an elaborate ceremonial court; and artisans whose works in ivory, wood, bronze, and brass are prized throughout the world today. In the 17th through 19th centuries, European traders established coastal ports for the increasing traffic in slaves destined for the Americas. Commodity trade, especially in palm oil and timber, replaced slave trade in the 19th century, particularly under anti-slavery actions by the British navy. In the early 19th century the Fulani leader, Usman dan Fodio, launched an Islamic crusade that brought most of the Hausa states and other areas in the north under the loose control of an empire centered in Sokoto.

A British Sphere of Influence
Following the Napoleonic wars, the British expanded their trade with the Nigerian interior. In 1885, British claims to a sphere of influence in that area received international recognition and, in the following year, the Royal Niger Company was chartered. In 1900, the company's territory came under the control of the British Government, which moved to consolidate its hold over the area of modern Nigeria. In 1914, the area was formally united as the "Colony and Protectorate of Nigeria."

Administratively, Nigeria remained divided into the northern and southern provinces and Lagos colony. Western education and the development of a modern economy proceeded more rapidly in the south than in the north, with consequences felt in Nigeria's political life ever since. Following World War II, in response to the growth of Nigerian nationalism and demands for independence, successive constitutions legislated by the British Government moved Nigeria toward self-government on a representative, increasingly federal, basis.

Nigeria was granted full independence in October 1960, as a federation of three regions (northern, western and eastern) under a constitution that provided for a parliamentary form of government. Under the constitution, each of the three regions retained a substantial measure of self-government. The federal government was given exclusive powers in defense and security, foreign relations, and commercial and fiscal policies. In October 1963, Nigeria altered its relationship with the United Kingdom by proclaiming itself a federal republic and promulgating a new constitution. A fourth region (the midwest) was established that year. From the outset, Nigeria's ethnic, regional, and religious tensions were magnified by the significant disparities in economic and educational development between the south and the north. On January 15, 1966, a small group of army officers, mostly southeastern Ibos, overthrew the government and assassinated the federal prime minister and the premiers of the northern and western regions. A federal military government assumed power, but it was unable to quiet ethnic tensions or produce a new constitution acceptable to all sections of the country. In fact, its efforts to abolish the federal structure greatly raised tensions and led to another coup in July. The massacre of thousands of Igbo in the north prompted hundreds of thousands of them to return to their homeland in the southeast, where increasingly strong Igbo secessionist sentiment emerged.

In a move that gave greater autonomy to minority ethnic groups, the military replaced the four regions with 12 states. The Igbo rejected attempts at constitutional revisions and insisted on full autonomy for the east. Finally, in May 1967, Lt. Col. Emeka Ojukwu, the military governor of the eastern region, who emerged as the leader of increasing Igbo secessionist sentiment, declared the independence of the eastern region as the "Republic of Biafra." The civil war, which ensued, was bitter and bloody, ending in the defeat of Biafra in 1970. Following the civil war, reconciliation was rapid and effective, and the country turned to the task of economic development. Foreign exchange earnings and government revenues increased spectacularly with the oil price rises of 1973-74.

On July 29, 1975, Gen. Murtala Muhammed and a group of fellow officers staged a bloodless coup, accusing the military government of delaying the promised return to civilian rule and becoming corrupt and ineffective. General Muhammed replaced thousands of civil servants and announced a timetable for the resumption of civilian rule by October 1, 1979. Muhammed also announced the government's intention to create new states and to construct a new federal capital in the center of the country.

General Muhammed was assassinated on February 13, 1976, in an abortive coup, and his chief of staff, Lt. Gen. Olusegun Obasanjo, became head of state. Obasanjo adhered meticulously to the schedule for return to civilian rule, moving to modernize and streamline the armed forces and seeking to use oil revenues to diversify and develop the country's economy. Seven new states were created in 1976, bringing the total to 19. The process of carving out additional states continued until, in 1996, there were 36.

The Second Republic
A constituent assembly was elected in 1977 to draft a new constitution, which was published on September 21, 1978, when the ban on political activity, in effect since the advent of military rule, was lifted. Political parties were formed, and candidates were nominated for president and vice president, the two houses of the National Assembly, governorships, and state houses of assembly. In 1979, five political parties competed in a series of elections in which a northerner, Alhaji Shehu Shagari of the National Party of Nigeria (NPN), was elected president. All five parties won representation in the National Assembly.

In August 1983, Shagari and the NPN were returned to power in a landslide victory, with a majority of seats in the National Assembly and control of 12 state governments. But the elections were marred by violence and allegations of widespread vote rigging and electoral malfeasance led to legal battles over the results.

On December 31, 1983, the military overthrew the Second Republic. Maj. Gen. Muhammadu Buhari emerged as the leader of the Supreme Military Council (SMC), the country's new ruling body. He charged the civilian government with economic mismanagement, widespread corruption, election fraud, and a general lack of concern for the problems of Nigerians. He also pledged to restore prosperity to Nigeria and to return the government to civilian rule but proved unable to deal with Nigeria's severe economic problems. The Buhari government was peacefully overthrown by the SMC's third-ranking member, Army Chief of Staff Maj. Gen. Ibrahim Babangida, in August 1985.

Babangida cited the misuse of power, violations of human rights by key officers of the SMC, and the government's failure to deal with the country's deepening economic crisis as justifications for the takeover. During his first few days in office, President Babangida moved swiftly to restore freedom of the press and to release political detainees being held without charge. As part of a 15-month economic emergency, he announced stringent paycuts for the military, police, and civil servants and proceeded to enact similar cuts for the private sector. Imports of rice, maize, and later wheat were banned. President Babangida demonstrated his intent to encourage public participation in government decisionmaking by opening a national debate on proposed economic reform and recovery measures. The public response convinced Babangida of intense opposition to an economic recovery package dependent on an International Monetary Fund (IMP) loan and an apparent preference for self-imposed austerity.

Third Republic
President Babangida promised to return the country to civilian rule by 1990; this date was later extended until January 1993. In early 1989, a constituent assembly completed work on a constitution for the Third Republic.

In the spring of 1989, political activity was again permitted. In October 1989 the government decreed the establishment of two "grassroots" parties: the National Republican Convention (NRC), which was to be "a little to the right," and the Social Democratic (SDP), "a little to the left." Babangida rejected other parties, and they were not allowed to register.

In April 1990, mid-level officers attempted to overthrow the Babangida government. The coup failed, and 69 accused coup plotters were later executed after secret trials before military tribunals. The transition resumed after the failed coup. In December 1990 the first stage of partisan elections was held at the local government level. While turnout was low, there was no violence, and both parties demonstrated strength in all regions of the country, with the SDP winning control of a majority of local government councils.

In December 1991, gubernatorial and state legislative elections were held throughout the country. Babangida decreed in December 1991 that previously banned politicians would be allowed to contest in primaries scheduled for August 1992. These were canceled due to fraud and subsequent primaries scheduled for September also were canceled. All announced candidates were disqualified from again standing for president once a new election format was selected. The presidential election was finally held on June 12, 1993, with the inauguration of the new president scheduled to take place August 27, 1993, the eighth anniversary of President Babangida's coming to power.

In the historic June 12, 1993 presidential elections, which most observers deemed to be Nigeria's fairest, early returns indicated that wealthy Yoruba businessman M.K.O. Abiola would win a decisive victory. However, on June 23, Babangida, using several pending lawsuits as a pretense, annulled the election and threw Nigeria into turmoil. Over 100 persons were killed in riots before Babangida agreed to hand over power to an "interim government" on August 27, 1993. Babangida then had second thoughts and attempted to renege on his decision, but without popular and military support he was forced to hand over to Ernest Shonekan, a nonpartisan businessman. Shonekan was to rule until new elections, scheduled for February 1994. Although he had led Babangida's Transitional Council since early 1993, Shonekan was unable to tackle Nigeria's ever-growing economic problems.

With the country sliding into chaos, Defense Minister Sani Abacha quickly assumed power and engineered Shonekan's "resignation" on November 17, 1993. He dissolved all democratic political institutions and replaced elected governors with military officers. Abacha promised to return the government to civilian rule but refused to announce a timetable until his October 1, 1995 Independence Day address.

Following the annulment of the June 12 election, the United States and other nations imposed various sanctions on Nigeria, including restrictions on travel by government officials and their families and suspension of arms sales and military assistance. Additional sanctions were imposed as a result of Nigeria's failure to gain full certification for its counter-narcotics efforts. In addition, direct flights between Nigeria and the United States were suspended on August 11, 1993, when the Secretary of Transportation determined that Lagos' Murtala Muhammed International Airport did not meet the security standards established by the FAA. The FAA in December 1999 certified securty at MMIA, opening the way for operation of direct flights between Lagos and U.S. airports.

Although Abacha's takeover was initially welcomed by many Nigerians who thought he could lead the country out of its morass, disenchantment grew rapidly. A number of opposition figures united to form a new organization, the National Democratic Coalition (NADECO), which campaigned for an immediate return to civilian rule. The government arrested NADECO members who attempted to reconvene the Senate and other disbanded democratic institutions. Most Nigerians boycotted the elections for delegates to the Constitutional Conference, which were held from May 23-28, 1994.

On June 11, 1994, using the groundwork laid by NADECO, Abiola declared himself president and went into hiding. He reemerged and was promptly arrested on June 23. With Abiola in prison and tempers rising, Abacha convened the Constitutional Conference June 27, but it almost immediately went into recess and did not reconvene until July 11, 1994.

On July 4, a petroleum workers union called a strike demanding that Abacha release Abiola and hand over power to him. Other unions then joined the strike, which brought economic life in the Lagos area and much of the southwest to a standstill. After calling off a threatened general strike in July, the Nigeria Labor Congress (NLC) began to consider a general strike in August, after the government imposed "conditions" on Abiola's release. On August 17, 1994, the government dismissed the leadership of the NLC and the petroleum unions, placed the unions under appointed administrators, and arrested Frank Kokori and a number of other labor leaders. Although striking unions returned to work, the government arrested opponents, closed media houses, and moved strongly to curb dissent.

The government alleged in early 1995 that some 40 military officers and civilians were engaged in a coup plot. Security officers quickly rounded up the accused, including former head of state Obasanjo and his erstwhile deputy, retired General Shehu Musa Yar'Adua. After a secret tribunal, most of the accused were convicted, and several death sentences were handed down. The tribunal also charged, convicted, and sentenced prominent human rights activists, journalists, and others, including relatives of the coup suspects, for their alleged "antiregime" activities. In October, the government announced that the Provisional Ruling Concil (PRC--see below: Abubakar's Transition to Civilian Rule) and Abacha had approved final sentences for those convicted of participation in the coup plot.

In late 1994 the government set up the Ogoni Civil Disturbances Special Tribunal to try prominent author and Ogoni activist Ken Saro-lh'iwa and others for their alleged roles in the killings of four prominent Ogoni politicians in May 1994. Saro-lh'iwa and 14 others pleaded not guilty to charges that they procured and counseled others to murder the politicians. On October 31, 1995, the tribunal sentenced Saro-Wiwa and eight others to death by hanging. In November Abacha and the PRC confirmed the death sentence. Saro-Wiwa and his eight co-defendants were executed on November 10.

In an October 1, 1995 address to the nation, Gen. Sani Abacha announced the timetable for a 3-year transition to civilian rule. Only five of the political parties which applied for registration were approved by the regime. In local elections held in December 1997, turnout was under 10%. By the April 1998 state assembly and gubernatorial elections, all five of the approved parties had nominated Abacha as their presidential candidate in controversial party conventions. Public reaction to this development in the transition program was apathy and a near-complete boycott of the elections.

On December 21, 1997, the government announced the arrest of the country's second highest-ranking military officer, Chief of General Staff Lt. Gen. Oladipo Diya, 10 other officers, and eight civilians on charges of coup plotting. Subsequently, the government arrested a number of additional persons for roles in the purported coup plot and tried the accused before a closed-door military tribunal in April in which Diya and eight others were sentenced to death.

Abacha, widely expected to succeed himself as a civilian president on October 1, 1998, remained head of state until his death on June 8 of that year. He was replaced by General Abdulsalami Abubakar, who had been third in command until the arrest of Diya. The PRC, under new head of state Abubakar, commuted the sentences of those accused in the alleged 1997 coup in July 1998. In March 1999, Diya and 54 others accused or convicted of participation in coups in 1990, 1995, and 1997 were released. Following the death of former head of state Abacha in June, Nigeria has released almost all known civilian political detainees, including the Ogoni 19.

During the last months of the Abacha regime, the government continued to enforce its arbitrary authority through the federal security system (the military, the state security service, and the courts). Under Abacha, all branches of the security forces committed serious human rights abuses. After Abubakar's assumption of power and consolidation of support within the PRC, human rights abuses decreased.

Other human rights problems included infringements on freedom of speech, press, assembly, association, and travel; violence and discrimination against women; and female genital mutilation. Worker rights suffered as the government continued to interfere with organized labor by restricting the fundamental rights of association and the independence of the labor movement. After it came to power in June 1998, the Abubakar government took several important steps toward restoring worker rights and freedom of association for trade unions, which had deteriorated seriously between 1993 and June 1998 under the Abacha regime. The Abubakar government released two imprisoned leaders of the petroleum sector unions, Frank Kokori and Milton Dabibi; abolished two decrees that had removed elected leadership from the Nigeria Labour Congress and the oil workers unions; and allowed leadership elections in these bodies.

Abubakar's Transition to Civilian Rule
During both the Abacha and Abubakar eras, Nigeria's main decisionmaking organ was the exclusively military Provisional Ruling Council (PRC) which governs by decree. The PRC oversaw the 32-member federal executive council composed of civilians and military officers. Pending the promulgation of the constitution written by the constitutional conference in 1995, the government observed some provisions of the 1979 and 1989 constitutions. Neither Abacha nor Abubakar lifted the decree suspending the 1979 constitution, and the 1989 constitution was not implemented. The judiciary's authority and independence was significantly impaired during the Abacha era by the military regime's arrogation of judicial power and prohibition of court review of its action. The court system continued to be hampered by corruption and lack of resources after Abacha's death. In an attempt to alleviate such problems, Abubakar's government implemented a civil service pay raise and other reforms.

In August 1998, the Abubakar government appointed the independent National Electoral Commission (NEC) to conduct elections for local government councils, state legislatures and governors, the national assembly, and president. NEC successfully held these elections on December 5, 1998, January 9, 1999, February 20, and February 27, 1999, respectively. For the local elections, a total of nine parties were granted provisional registration, with three fulfilling the requirements to contest the following elections. These parties were the People's Democratic Party (PDP), the All Peoples Party (APP), and the predominantly Yoruba Alliance for Democracy (AD). Former military head of state Olusegun Obasanjo, freed from prison by Abubakar, ran as a civilian candidate and won the presidential election. Irregularities marred the vote, and the defeated candidate, Chief Olu Falae, challenged the electoral results in court.

The PRC planned to promulgate a new constitution based largely on the suspended 1979 constitution, before the May 29, 1999 inauguration of the new civilian president. The draft constitution includes provisions for a bicameral legislature, the National Assembly, consisting of a 360-member House of Representatives and a 109-member Senate. The executive branch and the office of president will retain strong federal powers. The legislature and judiciary, having suffered years of neglect, must be rebuilt as institutions.

Principal Government Officials (Obasanjo administration)
President--Olesegun Obasanjo
Minister of Agriculture--Hassan Adamu
Minister of Aviation--Kema Chikwe
Minister of Commerce--Mustafa Bello
Minister of Communications--Mohammed Arzika
Minister of Culture and Tourism--Tonye Graham Douglas
Minister of Defense--Lt. Gen. Theophilus Danjuma
Minister of Education--Professor Tunde Adeniran
Minister of Employment and Labor--Musa Gwadabe
Minister of Environment--Sani Zango Daura
Minister of Federal Capitol Territory--Ibrahim Bunu
Minister of Finance--Mallam Adamu Ciroma
Minister of Foreign Affairs--Alhaji Sule Lamido
Minister of Health--Dr. Tim Menakaya
Minister of Industries--Chief Iyorchia Ayu
Minister of Information--Professor Jerry Gana
Minister of Internal Affairs--Chief S.M.Afolabi
Minister of Justice and Attorney General--Chief Bola Ige
Minister of Police Affairs--David Jemibewon
Minister of Power and Steel--Olesegun Agagu
Minister of Science and Technology--Chief Ebitimi Banigo
Minister of Solid Mineral--Alhaji Musa Gwadebe
Minister of Sports and Social Devt--Damiso Sango
Minister of Transport--Ojo Maduekwe
Minister of Water Resources--Col. M.Bello Kaliel
Minister of Women and Youth--Hajia Aishatu Ismail
Minister of Works and Housing--Chief Tony Anenih

National Assembly
President of the Senate--Chuba Okadigbo
Deputy President of the Senate--Haruna Abubakar
Speaker of the House--Ghali Umar N' A'Aba
Deputy Speaker of the House--Chibodom Nwanbueze Uche

Judiciary
Attorney General--Chief Bola Ige (San)
Permanent Secretary--Chief M.M. Dodo
Chief Justice of the Supreme Court--Hon. M.L. Uwais
Justices
A.G. Karibi-White
S.M.A. Belgeori
A.B. Wali
I.L. Kutigi
M.E. Ogundari
E.O. Ogwuegbu
U. Mohammed
S.U. Omu
A.I. Igun
A.I. Katsina Alu
G.O. Achiike
U.A. Kalgo
S.O. Uwaifo
A.O. Egiwunmi
E.O. Ayoola

Defense and Security
Chief of Defense Staff--Vice Admiral Ibrahim Ogohi
Chief of Army Staff--Lt. Gen. Victor Malu
Chief of Naval Staff--Vice Admiral Victor Ombu
Chief of Air Staff--Air Marshall Isaac Alfa
Chief of Staff (Pres)--Maj. Gen. Abdullahi Mohammed
Inspector General of Police--Musilu Smith
Dep. Inspector Gen. of Police--Alhaji Bukar Ali
DG Natl Intelligence Agency--Ambassador Uche O Okeke
State Security Service--Kayode Are
Controller Gen.,Customs--Alhaji Ahmed Ali Moustapha
Central Bank Governor--Joseph Sanusi
Drug and Law Enforcement--Iliya D. Lokadang

Ambassador to the U.S.--Dr. Jibril Aminu
Permanent Representative to the UN--Ambassador Arthur Mbanefo

Nigeria maintains an embassy in the United States at 1333 - 16th Street, NW, Washington, DC 20036, (tel. 202-986-8400, fax-202-775-1385) and a consulate general in New York at 575 Lexington Ave., New York, NY 10022, (tel. 212-715-7200).

ECONOMY

Dominated by Oil
The oil boom of the 1970s led Nigeria to neglect its strong agricultural and light manufacturing bases in favor of an unhealthy dependence on oil for more than 97% of export earnings and 80% of federal revenue. New oil wealth and general economic decline fueled massive migration to the cities and did little to reverse widespread poverty, especially in rural areas, and the collapse of even basic infrastructure and social services. Nigerian oil reserves are 25 billion barrels, and gas reserves are over 100 trillion cubic feet. Due to OPEC quota cutbacks and mounting community problems in oil producing areas, daily production has fallen to about two million barrels, of which 40% is exported to the United States.

The United States is Nigeria's main trading partner and foreign investor (nearly $7 billion), mostly in the energy sector. Exxon-Mobil, Chevron, and Texaco are prominent producers. Exxon-Mobil also is a major player in offshore exploration. Significant exports of liquefied natural gas are started in late 1999.

Agriculture has suffered from years of poor management, inconsistent and poorly implemented government policy, and lack of basic infrastructure, but it still accounts for 40.6% of GDP and 65% of employment. Nigeria is no longer a major exporter of cocoa, peanuts, rubber, and palm products. Cocoa production, mostly from obsolete varieties and overaged trees, is stagnant at around 150,000 tons annually; 25 years ago it was 300,000 tons. There has been a similar decline in peanuts and palm oil. Once the biggest poultry producer in Africa, inefficient corn production, coupled with a corn import ban, slashed output from 40 million birds on feed annually to about six million today. Import constraints limit the availability of many agricultural and food processing inputs. Land tenure in general does not favor long-term investment in technology or modern production methods.

Oil dependency, and the allure it generated of great wealth through government contracts, spawned other distortions. A greatly overvalued naira, fall in domestic purchasing power, the rising costs of imported inputs, and the expense of duplicating infrastructure like power generation fueled consumer imports and has pushed local industry to less than 30% capacity utilization. Many more Nigerian factories would have closed except for low labor costs (10%-15 %), and most--especially pharmaceuticals and textiles--have lost their ability to compete in traditional regional markets. Nigeria's foreign debt is about $30 billion and rising because of new arrears (the precise figure is disputed); about 75% is owed to Paris Club institutions, and much of it went to abandoned or nonperforming public sector projects.

Constraints after years of decline and policy inconsistency, the Nigerian Government's return to reformist policies in 1994 led to some macroeconomic stability but at the cost of new recession due to public sector budget cuts (the formal economy hinges on government spending) and new arrears on domestic and foreign debt. In part because of slumping oil revenue stemming from falling world prices, the government failed to fund its full share of oil joint venture operations, thereby compromising future production, or repair basic infrastructure like oil refineries and power generation. From its peak in 1980 of $25 billion, oil revenue dropped to less than $10 billion in 1998. Faced with falling revenues, falling foreign reserves (from nearly $8 billion in 1998 to $5 billion in March 1999), heavy pressure on the naira, new inflationary pressures, and the prospect of negative GDP growth in 1999, the government in January 1999 agreed to an IMF Staff Monitored Program as an essential first step toward its desire for significant debt relief. Increased oil prices in 2000 have raised government revenues. The IMF is considering a Standby Arrangement with Nigeria this year.

In addition to weak consumer spending, major development and investment constraints include the high cost of doing business in Nigeria, in large part because of the need to duplicate infrastructure, crime, lack of effective due process, and lack of transparency in economic decisionmaking, especially in contracting. Corruption is endemic and has resulted in projects that are either abandoned or completed at exorbitant costs; contract commissions of more than 100% are reportedly common. There has been notable progress in stabilizing the troubled banking sector, though it remains plagued by poor transparency and an unwillingness to acknowledge its many nonperforming loans.

Nigeria's overwhelmed transportation infrastructure is a major constraint to development. Principal ports are at Lagos (Apapa and Tin Can Island), Port Harcourt, and Calabar. The 8,577 kilometers (5,331-mi.) of navigable inland waterways, utilizing principally the Niger and Benue Rivers and their tributaries, are an important waterway system, though long-delayed dredging in several key areas limits their utility. Of the 80,500 kilometers (50,000 mi.) of roads, more than 15,000 kilometers (10,000 mi.) are officially paved, but many are in poor shape.

However, extensive road repairs and construction by the parastatal Petroleum Trust Fund have greatly improved many major interurban routes. There are 3,500 kilometers (2,180 mi.) of railroad track, which fell into near total disuse but are now slowly coming back into service after extensive renovation by a Chinese company. Three of Nigeria's airports (Lagos, Kano, and Port Harcourt) receive international flights. The government-owned Nigeria Airways is virtually moribund due to high debt and a vastly shrunken fleet and is now primarily a domestic carrier. There are several private Nigerian carriers, including one with international routes, but all reportedly are losing money due to high costs and weak demand.

Gradual Reform
Nigerian Government undertakings to privatize large parastatals have yet to be implemented or even detailed, despite many missed target dates. However, there has been slow but important progress on reform, including abolition of most foreign exchange and import controls in favor of a more open market; abolition of most price controls; privatization of some state-owned enterprises; abolition of the dual exchange rate system, which distorted budgets and spawned corruption; and liberalized rules for foreign investment. In late 1998, the government effectively ended indirect fuel subsidies by allowing domestic fuel prices to double to the equivalent of $1 per gallon (the government cut its tax take to give more to hard-pressed down-stream operators). For 3 years, Nigerians and their economy have endured painful and costly fuel shortages caused by the inability of Nigeria's dilapidated refineries to produce anywhere near capacity. Available fuel is often diverted to the domestic and regional black markets. Long-deferred maintenance of Nigeria's four refineries, resulting from the desire of Abacha regime insiders to boost their commissions from fuel imports, began in 1998 and will likely continue well into 1999.

Investment
Although grappling with the sobering reality of falling oil revenue, Nigeria continues to represent an important market. It is Africa's most populous nation, and it is extremely well endowed with human and mineral resources (especially hydrocarbon). Profitable niche markets outside the energy sector, like specialized telecommunication providers, have developed under the government's reform program, and there is a Nigerian consensus that foreign investment is essential to realizing Nigeria's vast but squandered potential. Companies interested in long-term investment and joint ventures, especially those that use locally available raw materials, will find potential opportunities in the large national market. Sustaining political reforms and its transition to democratic, civilian rule is essential to enhancing Nigeria's investment climate.

Economic Assistance
The United States assisted with Nigeria's economic development from 1954 through June 1974, when concessional assistance was phased out because of a substantial increase in Nigeria's per capita income resulting from rising oil revenue. By 1974, the United States had provided Nigeria with approximately $360 million in assistance, which included grants for technical assistance, development assistance, relief and rehabilitation, and food aid. Disbursements continued into the late 1970s, bringing total bilateral economic assistance to roughly $445 million.

The sharp decline in oil prices, the deterioration of the economy, and continued military rule characterized Nigeria in the 1980s. In 1983, USAID began providing assistance to the Nigerian Federal and State Ministries of Health to develop and implement programs in family planning and child survival. In 1992, an HIV/AIDS prevention and control program was added to existing health activities. USAID committed $135 million to bilateral assistance programs for the period of 1986 to 1996. Plans to commit $150 million in assistance from 1993 to 2000 were interrupted by strains in U.S.-Nigerian relations over human rights abuses, the failed transition to democracy, and a lack of cooperation from the Nigerian Government on anti-narcotics trafficking issues. By the mid-1990s, these problems resulted in the curtailment of USAID activities which might benefit the Nigerian Government. Existing health programs were re-designed to focus on working through grassroots Nigerian non-governmental organizations and community groups. As a response to the Nigerian military government's plans for delayed transition to civilian rule, the Peace Corps closed its program in Nigeria in 1994.

In response to the increasingly repressive political situation, USAID established a Democracy and Goverance (DG) program in 1996. This program integrates themes focusing on basic participatory democracy, human and civil rights, women's empowerment, accountability, and transparency with other health activities to reach Nigerians at the grassroots level in 14 of Nigeria's 36 states.

The sudden death of Gen. Sani Abacha and the assumption of power by Gen. Abdulsalami Abubakar in June 1998, marked a turning point in U.S.-Nigerian relations. USAID provided significant support to the electoral process by providing some $4 million in funding for international election observation, the training of Nigerian election observers and political party polling agents, as well as voter education activities. A Vital National Interest Certification was submitted to Congress in February 1999 by President Clinton to lift restrictions on U.S. Government interaction with and support to the Government of Nigeria. During a transitional period of 18 to 24 months, USAID planned to continue its active support to Nigeria by providing training on the roles and responsibilities of elected officials in a representative democracy for newly elected officials at the federal, state, and local levels prior to their installation in May 1999. Plans also call for assisting in the areas of conflict prevention and resolution in the Niger Delta, civil military relations, civil society, political party development, and encouraging private sector development and economic reform. In addition, health, HIV/AIDS, education, transportation infrastructure, and improving civil-military relations are priorities for bilateral assistance. Overall assistance for FY 2000 should total about $108 million.

DEFENSE
Active duty personnel in the three Nigerian armed services total approximately 76,000. The Nigerian army, the largest of the services, has about 60,000 personnel deployed in two mechanized infantry divisions, one composite division (airborne and amphibious), the Lagos Garrison Command (a division size unit), and the Abuja-based Brigade of Guards. It has demonstrated its capability to mobilize, deploy, and sustain battalions in support of peacekeeping operations in Liberia, Yugoslavia, Angola, Rwanda, Somalia, and Sierra Leone. The Nigerian navy (7,000) is equipped with frigates, fast attack Pratt, convenes, and coastal patrol boats. The Nigerian air force (9,000) flies transport, trainer, helicopter, and fighter aircraft, but most are currently not operational. Nigeria also has pursued a policy of developing domestic training and military production capabilities. After the imposition of sanctions by many Western nations, Nigeria turned to China, Russia, North Korea, and India for the purchase of military equipment and training.

FOREIGN RELATIONS
Since independence, Nigerian foreign policy has been characterized by a focus on Africa and by attachment to several fundamental principles: African unity and independence; peaceful settlement of disputes; nonalignment and nonintentional interference in the internal affairs of other nations; and regional economic cooperation and development. In carrying out these principles, Nigeria participates in the Organization of African Unity (OAU), the Economic Community of West African States (ECOWAS), the Nonaligned Movement, and the United Nations.

In pursuing the goal of regional economic cooperation and development, Nigeria helped create ECOWAS, which seeks to harmonize trade and investment practices for its 16 West African member countries and ultimately to achieve a full customs union. Nigeria also has taken the lead in articulating the views of developing nations on the need for modification of the existing international economic order.

Nigeria has played a central role in the ECOWAS efforts to end the civil war in Liberia and contributed the bulk of the ECOWAS peacekeeping forces sent there in 1990. Nigeria also has provided the bulk of troops for ECOMOG forces in Sierra Leone.

Nigeria has enjoyed generally good relations with its immediate neighbors. A longstanding border dispute with Cameroon over the potentially oil-rich Bakassi Peninsula is to be resolved by the International Court of Justice in The Hague. Nigeria released about 150 Cameroonian prisoners of war in late 1998.

Nigeria is a member of the following international organizations: UN and several of its special and related agencies, Organization of Petroleum Exporting Countries (OPEC), Economic Community of West African States (ECOWAS), Organization of African Unity (OAU), Organization of African Trade Union Unity (OATUU), Commonwealth, INTELSAT, Nonaligned Movement, several other West African bodies. The Babangida regime joined the Organization of the Islamic Conference (OIC), though President-elect Obasanjo has indicated he might reconsider Nigeria's membership.

U.S.-NIGERIAN RELATIONS
After the June 12, 1993 presidential election was annulled, and in light of human rights abuses and the failure to embark on a meaningful democratic transition, the U.S. imposed numerous sanctions on Nigeria. These sanctions included the imposition of Section 212(f) of the Immigration and Nationality Act to refuse entry into the U.S. of senior government officials and others who formulated, implemented, or benefited from policies impeding Nigeria's transition to democracy; suspension of all military assistance; and a ban on the sale and repair of military goods and refinery services to Nigeria. The U.S. Ambassador was recalled for consultations for four months after the execution of the Ogoni Nine on November 10, 1995.

After a period of increasingly strained relations, the death of General Abacha in June 1998 and his replacement by General Abubakar opened a new phase of improved bilateral relations. As the transition to democracy progressed, the removal of visa restrictions, increased high-level visits of U.S. officials, discussions of future assistance, and the granting of a Vital National Interest Certification on counter-narcotics, effective in March, 1999, paved the way for re--establishment of closer ties between the U.S. and Nigeria, as a key partner in the region and the continent.

Principal U.S. Officials
Charge d'Affaires--Nancy Morgan Serpa
Political Affairs--Kathleen Fitzgibbon
Economic Affairs--Lawrence Cohen (expected September 2000)
Commercial Affairs--Miguel Pardo de Zela
Agricultural Affairs--David Rosenbloom
Consul General--Ronald Robinson (expected September 2000)
Defense Atache--Col. Victor Nelson
Public Affairs--James J. Callahan
Principal Officer, Embassy office Abuja--Timothy Andrews



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