Why Government Benefit Transfer Interventions To The N/Delta Have Yielded Little Results – Nwadishi

Faith Nwadishi

Faith Nwadishi is a former Nigerian representative on the global Board of the Extractive Industries Transparency Initiative (EITI) and Convener, Women in Extractives. In this interview with e360, on the sidelines of a dialogue to appraise mechanisms used to transfer benefits of resource extraction to the Niger Delta Region held recently in Uyo by the Nigeria Natural Resource Charter (NNRC), she speaks on why the several government intervention mechanisms have failed and what could be done. Excerpts.


The Niger Delta region is still plagued with a plethora of issues, why hasn’t the various government intervention mechanisms for benefit transfer to the region worked?

Because simply there were no proper community dialogues around such interventions. And also because of the mentality that we think a single initiative will solve all the problems, we forget that communities differ. Some are onshore, others are close to the sea while some are islands, so in considering these interventions we have not put these differences into focus. Also we normally have very ambitious interventions, we don’t consider them from the point of view of achieving low hanging fruits or what can be built on. Unfortunately all of this is centered around the fact that ownership of the natural resources is situated within the federal government, so you have a system where decisions are made between the federal and state government without considering the input of the local government which is closer to the people. In some other instances, we also have local government chairmen who have been handpicked by the state governors, and many of them don’t live within the local area. So in the end it’s like ticking off the boxes to show that Nigeria is a signatory to international conventions. So because there’s a disconnect between the people and the federal government, the people will now put all their expectations on the oil companies operating in their areas. Whereas the oil companies does not have a link to the federal government plans, they only have their own plans in line with their country government. They have signed a contract with the federal government, they pay taxes, they don’t have a contract with the people, so that’s why you have most of these disconnect and lingering issues.


Will a deliberate law or policy that would guarantee meaningful participation of the Niger Delta people in the decision making process help?

We have countries where it has worked, in the US for instance, the federal government give technical support to oil bearing communities around resolving issues arising from oil exploration. And that’s why the US government could not report on behalf of the federating states in the EITI, they could only report on the taxes they pay. It has also worked in Norway. Nigeria and Norway started oil exploration same year, but look at what the Norwegian oil sector has become. It also worked in Brazil. When people have a sense of ownership, things work, but when it seems like you are doing them a favour and giving them handouts then they get disconnected. In the US, when issues arise, a trust fund is usually set up to be managed by the people, but in Nigeria we set up a fund that is managed by the federal government and monies are given out without involvement of the people and proper accountability. States have set up development commissions, the ideal is to use 50percent of what they get from federal as 13percent derivation to develop areas where they have oil exploration. Ironically, people employ all means to become members of these commissions, but there’s no direct connection between members of the commission and the members of the oil communities. So to avoid going round the circle, we can borrow good practices from countries where things are working and input our communal ways of living to localize it. That’s why the idea for the solid minerals which requires prospecting investors need to sit with members of the community where they seek for mining licenses to draw up a five years community development plan, is commendable.


Given our experience, should present/future interventions be handled by the federal or state government? And where would you lay the blame for the past failed interventions?

The fact is, where you have a right, you have a responsibility. As it is, the right to the exploration of natural resources in Nigeria is with the federal government. Until when we have the conversation that says the right is with the State or local government, the federal government must bear the responsibility. But I believe that if we put that power on the local government our elections will no longer be a do or die affair, people will no longer fight to go to Senate or House of Representatives. They will rather fight to be heads of local government areas. And because people will now have responsibilities over smaller areas you are able to hold them more accountable. It’s easier to manage resources that come from the local area by the heads of the local government. Then it will be easier for the federal government to request for their contribution to the centre since they are a part of the federating unit. In the end, if things are going wrong, the people themselves will know who to hold accountable. So we really need to sit down and look at what has happened in other places and let people learn to deliver on their responsibility based on the rights they have.


Do you think the Host and Impacted Community bill, when it becomes law, can help resolve some of these issues?

It’s unfortunate that we have politicized a lot of things, even that bill is not addressing the part of saying the responsibility of developing the oil bearing community is with the federal government. The bill does not give the right of management to community people, the only thing it does is to create a space for community people to participate in the dialogues and negotiations that happen. So it’s going to solve the Niger Delta issues to an extent, but it can’t solve the entire problem of resource management and governance in the region to be like the way it’s done in other climes.


There are conflict entrepreneurs who often fuel crisis in the region, what is their impact in this entire process?

The fact is that they are everywhere. Anywhere you have conflicts you have people who are making money out of it. They know that if there’s peace they don’t get anything out of the system, so they stir up trouble. It appears to have become a norm, not just in Nigeria but almost everywhere you have natural resources. Not until we are able to get to a state where members of the community come to the table and see projects as theirs, and not for the investors, these conflict entrepreneurs will remain in business. Community people need to be made aware that these people are fuelling these conflicts and making money out of it. They need be exposed to allow for peace and development to take place.


Do you believe that beneficial ownership can play a role in helping to solve any of these problems?

The issue around Beneficial Ownership or ownership of oil blocks didn’t start until we started talking about indigenous owners. Often times, we see percentages allotted to community members only on paper. Their name may be there stating that they have 70percent of the company, but it will shock you to know that they cannot take decisions for the company. The companies fly in people from abroad who make all the decisions. They manipulate the community person into believing that he/she is a co-owner of the business, but in actual fact, they own nothing. This is happening, I know of a live example with one of the gas companies operating in the Niger Delta. So that’s why beneficial ownership is important, it would help us know who the natural owners are. You can then query the person on paper who has 70 percent, and find out on whose behalf it is held. Because usually the person is made to sign another paper with the company stating that the shares is being held in trust for someone, but that other paper doesn’t go to the Corporate Affairs Commission (CAC). We have seen instances where a five months old baby is said to own big assets on paper. So beneficial ownership will help us know who truly the natural owners of the assets are, and once the people have that information, the owners won’t take them for granted anymore and they would be more accountable. Even when it is found that members of the community are truly part owners of oil blocks, the people will see it as theirs and would tend to protect it. So I believe beneficial ownership would also help in solving some of the conflicts. Unfortunately, a lot of people feel that when you open up something too much, many questions will be asked, but it is in asking these questions that you are able to nip things in the bud. When you keep things too secret there’s a lot of perception that may lead to crisis.


As women and children are most impacted by the negatives across the value chain, what is your organization doing to empower women to better participate in this space?

I am happy to say that at the international level we have been able to put the issue of gender on the table. For instance, I was a frontline pusher for gender to be included in the EITI process, and it been included this year as one of the requirement in the EITI standard. So what we do is to get actual data about the impact of hydrocarbon extraction on women and data about women participation in extractives. We go around talking with community women to look at what exactly is the impact of extraction on them, and we have found that there have been impacts that cuts across livelihood and health. We have been giving them the right information on how to handle these issues. Some of them ask for skill acquisition and alternatives because their rivers have become dead with the impact of extraction, bearing in mind that they are natural fisherwomen. For some their farmlands have been destroyed, so they keep asking for alternative ways to sustain themselves. There is what is called slot for job and contracts execution that oil companies do give to communities periodically, usually it is the men who get it. So the women are also now asking that they be included, if there are 10 slots, the women should be given at least two, because women are breadwinners in many families.

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