No fast forward for Nigeria's poor despite oil boom

from Reuters

By Estelle Shirbon

MARABA, Nigeria (Reuters) - A short drive away from Nigeria's capital Abuja, with its air-conditioned villas and ministers in luxury cars, life for many in the town of Maraba is a daily struggle to eat.

On streets lined with rotting garbage and ramshackle stalls, Aminu Ladan polishes shoes to scrape out a living. On a weekday he makes just over $1, but it costs more than that to eat so he sometimes skips meals.

Ladan follows the news on the radio and knows Nigeria, Africa's biggest oil exporter, has seen its revenues soar in the past four years thanks to high oil prices. The government made more than $40 billion from oil exports last year.

But it's no boom time in Maraba.

"The politicians have stolen all the money. They have their children schooling overseas. I never went to school because I had to work in the farm with my father," said Ladan, 24, who sleeps outdoors and pays a fee to use someone's bucket to wash.

The U.N. Development Programme estimates nine out of 10 of Nigeria's 140 million people live on less than $2 per day.

Nigeria's National Bureau of Statistics uses a relative measure of poverty that sets the breadline as low as 51 cents a day. More than half the population don't make it above that.

The failure to lift the majority of people out of poverty is a major indictment of government in Nigeria, which was ruled by the army for most of its history since independence in 1960.

The country returned to civilian rule eight years ago under President Olusegun Obasanjo. For the past four, his government has launched reforms aimed at stabilizing government spending, reducing poverty, promoting private enterprise and improving efficiency of ministries crippled by decades of misrule.

There have been undisputed successes in controlling the government's runaway spending and strengthening the banking system, but progress has been slow in other areas.

SUBSISTENCE

Nigerians still have to live with power cuts or no power at all, bad roads, poor water supplies and falling standards in schools and hospitals. One in five Nigerian children do not survive until their fifth birthday, according to UNICEF.

In the village of Angwan Jarmai in central Nigeria, Mohammed Salihu, 45, tills the soil by hand to grow yams, cassava, maize and millet. His two wives, seven children and extended family depend on these crops to eat.

They sell whatever is left but the money is not enough to pay school fees, so his children take turns skipping terms. Doctors' bills are a headache.

The family live in low mud-brick houses. There is no electricity in the village so they use a kerosene lamp at night. The men bring firewood for the women to cook. Babies have died of malaria or diarrhoea. Life hasn't changed for generations.

"When I look at how my father lived and how I live, I honestly cannot say anything has got better," said Salihu.

Amina Ibrahim, senior special adviser to Obasanjo on the Millennium Development Goals, says more progress has been made than people realize, but it will take time to trickle down.

"Everyone expects us to press fast forward but you can't solve in four years a situation that took 25 years to reach this point," she said.

Ibrahim said Nigeria's development plan contained the right policies to create jobs and improve basic services, but there were many challenges in implementation.

These include corruption, a dearth of skills among civil servants, poor coordination between the federal, state and local governments, and resources that are spread too thin across the Africa's most populous nation.

PRIVATE SECTOR GROWTH

Obasanjo is due to step down after elections in April, and Ibrahim said it was crucial that the next government should deepen the reforms and broaden the fight against corruption.

Many economists say economic growth in Nigeria can best be stimulated by the private sector.

They point to telecoms as a shining example. There was one telephone for every 280 Nigerians in 1999 before the industry was liberalized. Now there is one telephone for every five people and millions of Nigerians have benefited.

Hundreds of thousands of jobs have been created. Young men selling top-up cards for mobile telephones are everywhere, and more communication means more work for many small businesses.

Suleiman Yahyah launched Rosecom, a small telecoms firm, in 1998 with $15,000. Rosecom is now worth more than $3 million.

"The changing environment compared with before 1999, the regulatory changes introduced by government, have opened up the market and been a major factor in our success," said Yahyah.

He says growth is still limited by power shortages, bad infrastructure and the fact that so many Nigerians are too poor to afford phones. But he sees a bright future for the sector and for the broader economy, as long as the reforms are sustained.

"Nigerians have a high appetite for consumption and they will be willing to spend money for the right product ... Nigeria is the place to be as an investor," he said.