AN ASSESSMENT OF CORRUPTION AND UNDERDEVELOPMENT IN NIGERIA (A CASE STUDY OF HALLIBURTON)

CHAPTER ONE

GENERAL INTRODUCTION

Background of the Study

A man can be born again; the springs of life can be cleansed instantly…if this is true of one, it can be true of any number. Thus, a nation can be born in a day if the ideals of the people can be changed [William Jennings Bryan].

Nigeria is one of the Countries in Africa that loses billions of dollars yearly because of corruption. She was ranked the second most corrupt country in the world in 2004 [Olu-Olu, 2008]. In 2005 and 2008, Nigeria was ranked 13th and 17th respectively out of 146 countries by Transparency International’s Corruption Perception Index [TICPI]. Although the 2007 ranking placed Nigeria as the 32nd most corrupt country out of 147 countries by TICPI, corruption still remains a serious problem in Nigeria [Shehu, 2006].

Corruption is    a    “multifaceted   phenomenon  with   multiple   causes   and   effects” [Andvig and fjeldstad, 2001: 1]. It is a trinity of illegal money, commercial and criminal activities [Baker, 2005; Guanardi, 2008]. According to section 8(1) of the Anti-Corruption Law of Nigeria (2004), it entails the act of asking for, receiving or obtaining any property or benefit of any kind for oneself or for any other person. It involves the abuse of public office for self-aggrandizement or private benefits [World Bank, 1997].

The term “corruption” covers a wide range of conduct patterns. It is a product of the socio-economic and political structure of any society. As a multi-faceted phenomenon, no single theory is equipped enough to explain its causation and/or control.

Corruption is not a Nigerian Word. It is an English Word. While corruption is an English word necessarily laced with western ideas, the concept behind it is found in other cultures. Corruption is one of the dare devils that stares humanity in the face. It is also a global problem with certain destructive tendencies in the Third World Countries like Nigeria. But the rate of corruption in Nigeria is so alarming that one is constrained to ask: Is there anything peculiar to the nature of Nigerians that makes them to be corrupt? Achebe [1983: 35], quoting from the weekly star newspaper of May 15, 1983, wrote that the corrupt nature of the Nigerian society is such that, keeping an average Nigerian from being corrupt is like keeping a goat from eating yam.

Corruption serves as a spring board to under-development in Nigeria. Most economic, political and social problems in underdeveloped societies like Nigeria emanate from corruption which manifest in many ways such as: lack of accountability, inadequate funding of programs, diversion of public resources to private ownership, different types of discriminations, ethnicity, lack of competence, inefficiency etc.

The problem of corruption as a phenomenon is historically rooted in the country’s political economy. In the colonial period, it was attributed to colonialism.

Although, the government has embarked upon anti-corruption measures, these are not sincerely and properly implemented such that the expected objectives and goal are not achieved. The problem is thus rather aggravated. Consequently, corruption has continued to perpetuate underdevelopment in Nigeria. Many factors seem to have combined to make the situation severe or worse than the case in the colonial era. Firstly, Achebe (1983: 1) fascinatingly explained that:

The trouble with Nigeria is simply and squarely, a failure of Leadership. There is nothing basically wrong with the Nigeria land and climate or water or air or anything else the Nigerian problem is the unwillingness or inability of its leaders to rise to the responsibility or to challenge of personal examples, which are hallmarks of true leadership.

There is also a common belief that poverty is one of the major causes of corruption. Here, it is argued that there exists a great deal of poverty among Nigerians in almost every segment of their social life. In Nigeria today, it is just a few families that can boast of three square meals a day, wear good clothes, or enjoy the basic necessities of life, such as water, good road network and electricity. Hence, everyone takes to corruption, no matter one’s own small capacity as a way of making up or balancing the prevalent inequalities. It is also equally true that, corruption is due to the degeneration and shaky foundations of our moral upbringing.

Corruption transcends nearly every structure of Nigerian society. The situation is so bad that corruption has been institutionalized to a point where it almost passes for official policy in both public and private sectors of our national life. The socio-economic and political system itself appears to be built on corruption and it thrives on it. Even the churches and other religious organizations are themselves not completely free of corrupt practices.

This study attempts to assess the impact of corruption in Nigeria’s development with a view to suggesting alternative approach of tackling the phenomenon.

• Statement of Problem

One of the most fundamental problems facing Nigeria today is corruption. The corruption has not only weakened the moral fiber of Nigeria, it has also wreaked havoc in its body politics. Corruption in Nigeria is so devastating and alarming that it has virtually affected every sector of the economy.

Consequently, it is obvious that corruption has been a major bane of socio-economic and political development in Nigeria. This leads to the following questions on which the research is based.

• Is corruption responsible for Nigeria’s underdevelopment?

• Is the persistence of corruption in Nigeria linked to external factors?

• Can deregulation curb the menace of corruption and engender development in Nigeria?

Corruption has affected many sectors of the economy. For instance, Nigeria presents a typical care of a Country in Africa whose development has been undermined and retarded by the menace of corrupt practices.

To say that corruption has eaten deep into every aspect of the Nigerian Society is to affirm the obvious. This can be inferred from the revelations of probe panels that have been set up at different times by different regime.

In Nigeria, since independence, series of reforms have been carried out in the public service so as to make the public bureaucracy more efficient and result oriented. However, the anticipated gains of such reforms have not been visible due to series of factors which include that of corruption.

Whichever way one views corruption, particularly bureaucratic corruption, it involves a violation of public duty or deviation from high moral standards in exchange for [or in anticipation of] personal pecuniary going. It is connected with moral and dishonest acts. Gould D.J cited in identified more than twenty categories of corrupt practices in developing nations which are very much visible in Nigeria State. These are bribery, fraudulent use of official stationary, payment for office visit, payment for letter of recommendation, kickback for wiring, money travel documents and travel related peccadilloes, misuse of official housing two salaries, neglect of public service for per tonal business, salary computation fraud, embezzlement in its various form among other.

Corruption in the bureaucratic class is the type of corruption the citizens encounter daily at places like the hospitals, schools, local counseling offices, encounters with the police, taking offices, etc. it is petty corruption of need that occurs when one obtains a business from the public sector through inappropriate procedure.

However, corruption in the bureaucratic class in Nigeria came into being when public servant not steamed in the traditions of a political professionalism, saw how politicians who hitherto, were nothing, became rich overnight through patronages, gift, bribes and actual embezzlement of government funds. It was only a matter of time before the bureaucrats joined them.

In Nigeria’s fourth republic, corruption has become a Norm and practice of politics among the present political class [i.e. those that control the affairs of the state] from the presidency of the councilors of local authorities and party chairman. The furniture mentality which this political class brought to governance represents the highest form of corruption and enslavement of the popular masses of the country.

Political corruption in Nigeria encompasses the use of official power and government resources by the political class for sordid and disrepute private gain.

Indeed, political corruption could be said to be the “head” and other forms of corruption are the “body” cut of the head; the other parts could cease to grow. Nigeria’s main development problem is political corruption which needs to be eradicated.

Accurately, it can be asserted that, it is the duty and responsibility of every good government to create their environment and set the tone for good and effective policies, including conducive business environment, protection of persons and properties etc. in any society or country. The Nigeria government has been blamed properly. So, for not setting a conducive environment, economic and social development over the years, particularly at this time, when public security and safety has steadily become a major issue for citizens and corporate investors alike.

Corruption additionally, has become a hot topic among citizens and investors both apparently risen, due in part, to a battered and depressed economy, and since, the discussion or debate regarding corruption, has tended to be focused or centered around the government or public sector component of the hydra-head corruption monster. This is so, even though, corruption levels or magnitude is not much different, in the private sector.

But is quite another thing, and pretend that corruption in Nigeria is localized to public officers and public office-holders sellers of adulterated kerosene are practicing unethical business methods, and even a criminal enterprise, ditto for the groundnut seller who cheats you out of more groundnut because he uses a crooked cup-measure, it is corruption practices, when banks and other financial institutions charge outrageous interest rates, refuse to grant loans to legitimate business people and companies, for capacity building, but grant loans to the well-connected and those willing to wet- the ground, but would never payback the loans.

Government has brought ways of combating corruption through some crude in Nigeria. The provisions are laid down in the constitution of federal republic of Nigeria. These include the criminal code, probe panels and commissions, the anti-corruption tribunal, the anti-corruption acts and War against Indiscipline and Corruption Conduct of Bureau, Independent Corrupt Practices and other related offence commission etcetera.

In December 31, 1983, Gen. Muhammadu Buhari became the 7th Head of State in Nigeria selected to lead the country by middle and high ranking military officers after a successful coup d’état that overthrew civilian president Shehu Shagari on December 31, 1983. Buhari justified the military’s seizure of power by castigating the civilian government as hopelessly corrupt, and this administration subsequently initiated a public campaign against indiscipline known as “War against

Indiscipline” [WAI]. Aspects of this campaign include public humiliation of civil servants who arrived late for work whilst guards were armed with whips to ensure orderly queues a bus stop. He also moved to silence critics of this administration passing decrees curbing press freedoms and allowing for opponents to be detained up to three months without formal charges. He also banned strikes and lockouts by workers and founded Nigeria’s first secrete police force, the national security organization. This policy was a bit affective, as it curbs Nigeria’s indiscipline for a while until Ibrahim Babangida Badamasi succeeded him in August 27, 1985.

Public office is a trust which should not be abused. This necessitated the establishment of the code of conduct Bureau and Tribunal act, chapter 56 LFN 1990 which gave the bureau the mandate to establish and maintain a high standard of public morality in the conduct of government business and to ensure that the actions and behavior of public officers conform to the highest standard of public morality and accountability [Federal Republic 2002].

The Bureau has through its enlightenment programs enable the people to know what is expected of them and to an extent inflamed feat in the minds of some public officers as against corruption practices. Though, they have not achieved expected

result, hence, ICPC [Independent Corruption Practices and other related offense Commission] was established.

ICPC [Independent Corrupt Practices and other related offence commission] was inaugurated on September 29, 2002 by the Nigeria president Olusegun Obasanjo. The ICPC mandate is to prohibit and prescribe punishment for corrupt practices and other related offences.

This anti-corruption commission was eventually passed and signed into law

on the 13th of June 2000. The Act established the Independent Corrupt Practices and other related offences Commission [ICPC] with Justice Mustapha Akambin a returned federal appeal court judge as the chairman, and the act in section 3 [4] providing from the independence of the commission and gives the chair authority to issue orders for the controls and general administration of the commission.

Since the inauguration of the ICPC in 2000, the commission, however, has been performing its duties with great zeal and dedication, despite it perennial insufficient funds and manpower. These problems have also been made worse by the citizens who also are disgusted and devastated by corruption but have greeted the ICPC with outright hostility, suspicions and disbelief. Also they face the problem of slow judicial process and rigid procedures and National Assembly incompetence. For instance, it took National Assembly nearly one year to pass the ICPC Bill into law and this has been the case of other ICPC issues in National Assembly.

An important institution that was put in place by Obasanjo’s administration is the Economic and Financial Crimes Commission [EFCC]. The agency was set up in 2002 to tackle financial crimes including fraud and money laundering. Money laundering is a criminal process whereby the proceeds from crimes are hidden and the integrated into the financial system as legitimately acquired funds.

The EFCC act was a major departure from the past enabling laws fighting economic and financial crimes in Nigeria: in terms of powers, functions and responsibility.

Some problems emanated in the activities of EFCC. These problems are quite enormous and influential that it has impeded its great success. The crusade is Punic in nature and as a result, orchestrated by the politically exposed persons [PEPs] to the settling of political scores. For instance, it was allegedly noted that the commission under Ribadu’s chairmanship the beamed it search light on the political foes of the former president Obasanjo. Hence, the commission suffers politization. Also EFCC can rarely exercise the fall Wrath of the Law on these political readers because the law allows them to claim “political community”. Hence they serve only as prosecutors of crime negating the mandate of crime prevention.Government interference and the slow nature of judicial procedures also militates their activities.

It could be observed that the several crusade made by the government in order curb corruption in the Nigeria Society has not been effective. More so, the EFCC and ICPC are not independent, they are been controlled by the executives and these have been a major hindrance in the fight against corruption in Nigeria. Making corruption history is the surest way of making all the problems of Nigeria a history.

• Objective of the Study

The major concern of this study is to investigate how the growing incidence of corruption has stunned underdevelopment in Nigeria. However, the specific objectives are stated as follows;

• To discover if corruption is responsible for Nigeria’s underdevelopment.

• To ascertain if the persistence of corruption in Nigeria is linked to external factors.

• To determine if the deregulation policy is capable of curbing the menace of corruption in Nigeria.

• Significance of the Study

The study has two basic significances. They are both practical and theoretical in nature. Practically, this research work will be a guide to policy makers, economists, political analysts, policy implementers, and researchers. In other words, it will serve as a tool for the government and private organizations on how to curb and prevent corrupt practices and engender development in Nigeria.

Theoretically, the study will close the existing gap in the literature in corruption and by so doing; add to the existing volume of knowledge on the connection between corruption and underdevelopment and how it can be curbed.

• Hypotheses

For the purpose of guidance and in order to achieve the statements of problems and the objectives of this study, the researcher has proposed the following hypotheses:

H0: Corruption is responsible for Nigeria’s underdevelopment

H0: There is no close link between external factors and the persistence of corruption in Nigeria.

H0: Deregulation is capable of curbing the menace of corruption and engendering development in Nigeria.

• Methods of Data Collection and Analysis

In this study, we adopted the use of secondary sources of data as the main method of data collection. The use of the secondary sources of data is justified due to its intrinsic values. For any research to be meaningful, reliable and scientific facts and ideas, must be supplemented with empiricism.

Secondary materials like text books, newspapers, magazines, government publications, research papers, journal etc., were seriously put into use.

• Scope and Limitations of the Study

The scope of the research is limited to the relationship between corruption and underdevelopment in Nigeria.

This research work like virtually everything done by man has its limitations. This was largely because of the insufficient time.

Secondly, there were too many data to manage as the library that was consulted for example does not have sufficient current phenomenon of corruption and underdevelopment has elicited a plethora of literature from scholars and analysts in the field of social sciences and political science in particular. Also, lack of sufficient fund on the part of the researcher is another limitation because lack of fund made it possible for the researcher to purchase new materials and makes it possible to make required tours to the various sources of information.Time too was another constraint. The duration of time given to the researcher to carry out the research work was too short as the researcher has other academic commitments pursue too. So the time pressure affected the scope of the work.

• Definition of Terms

Corruption, according to encyclopedia Americana, is a general term for the misuse of public officer or position of trust for private grains.

Claude Ake [1981:2] in his book “Political Economy of Africa “, sees corruption to be existing in capitalist and class societies because of the prevalence of private property and scarcity which the capitalists state generate.

Underdevelopment: this means economic backwardness which results from the inability of a country to deal with its environmental, the underdevelopment is characterized by lack of indigenous industry, inadequate production of food, unscientific agriculture, underdevelopment is not absence of development but it makes sense only as a way of comparing levels of development. Underdevelopment is very much tied to the fact human social development has been uneven and from a strictly economic view part some human groups have advanced further by producing more and becoming wealthier.

Capitalist Countries: these are western allied nations that situate in Europe and North America and have colonies in African and other third world countries.

Capitalism: a system of production in Nigeria where individuals owns both the factors and means of production.

Siphoning: It is the act of removing money from one place to another, especially

dishonestly or illegally.

Corrupt practices: These are practices that are opposite to the formal way or method of carrying something out. Comprador bourgeoisie: These are Nigerian who perpetuates corruption in Nigeria.

Bribery: It refers to the act or practices of offering or taking bribes. It is the crime of elaborately using improper influence on public officials so as to win some advantage, eg. The award of a contract- chambers 21st century dictionary.

Dependency: Reliance and relying on somebody or something like Nigeria does on the westerns which is one of the causes of corruption.

Bourgeoisie:  These  are  the  individual  that  own  and  control  the  means  of production that was achieved with the help of the comprador in exploiting the nation.

Loans: these are aid given to less developed nation or countries (LDCs) .

Power; it is the ability to make people (or things) do what they would not otherwise have done. It could come or applied in a manipulative, coercive, forceful or persuasive way. It s disobedience may lead to punishments.

Colonialism: the policy and practices of a strong power extending it control territorially over a weaker nation or people.

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