No. 878: Nigeria: Resource Control

I refrain from counterfactual speculation wherever I can. It is not good scholarship to peddle "what ifs." But I wrestle constantly with issues which tend to lend themselves to such speculation, and my wandering mind occasionally seeks out imaginary scenarios and possibilities founded on non-existing situations.

One issue which has recently tasked my resolve to only discuss what 'is' rather than what might or could have been is the on-going controversy over derivation and resource control. Privately and publicly, we have confronted and contemplated a slew of counterfactual questions on the raging controversy over the demand of the South-South for an initial 25% of oil revenues, with a target of 50% at the end of five years. These questions all turn on one overarching question: what if the oil was in the NorthŠ.

Apart from satisfying the inquisitive proclivities of commentators, this question raises a whole set of historical issues which undermine the North's attempt to cast the resource control agitation of the South-South as a modern-day, oil-fueled greed that negates the historical trajectory of resource sharing and allocation in colonial and post-colonial Nigeria.

Let me be more specific. In response to questions such as the one above, and in articulating an answer to the struggle of the South-South people for a fair share of resources located in their territory, several contemporary Northern Nigerian politicians, some of them prominent actors in the present political arrangement, have often asked the South-South to take a cue from the generosity of their Northern brothers before oil was discovered in the Niger Delta in the 1950s. The North, it is said, generated remarkable wealth from groundnut, cotton, and other agricultural exports, wealth which it purportedly shared with the South, and some of which, according to some variants of this story, was used to subsidize colonial administration in colonial Southern Nigeria.

This is an ahistorical claim. It bears no historical veracity whatsoever, and, as a response to or a strategy to obfuscate the poignant, if counterfactual, question of what would happen if the North had all the oil, it fails woefully. As someone who studies Nigeria's colonial political economy for a living and who specializes in the politics and economy of Northern Nigeria during the colonial period, I can categorically state that there is irrefutable evidence in the historical sources which show conclusively that, far from subsidizing the administration of any part of the South, the North in fact received several grants and emergency funds from revenue pools which originated largely from the more expensive agricultural exports of the South-cocoa, timber, rubber, palm produce-and from customs and excise receipts collected on Southern coasts.

Before I interrogate the Northern claim further, let me state that there is a flip side of this ahistorical claim, which is no less incorrect. It is a claim which is often made by Southerners about colonial Northern Nigeria having been a fiscal leech and burden on the robust financial anatomy of the South. It is said that the South subsidized Northern colonial administration. This is at best an exaggeration. Northern contributions to the revenue pool of colonial Nigeria was considerably less than that of the South throughout the colonial period. But Northern colonial administration paid for itself for the most part. Whatever disproportionate fiscal burdens the North placed on the Federal colonial resource-pool went to fund capital projects such as roads, railways, bridges, and other infrastructures, whose benefits often accrued less to Northern Nigerians than to the colonial system and its goal of building imperial prosperity on the backs of the colonized. At any rate, direct income taxation was adopted in Northern Nigeria almost a decade before it was in Southern Nigeria, and the North was consistently taxed more heavily than was Southern Nigeria.

Back to the myth of Northern colonial generosity as a leveler in the current debates about resource control and increased derivation. The North, as a colonial entity, did generate significant wealth from agricultural exports. However, due to a multi-layered mercantilist infrastructure of produce-buying peopled rather hierarchically by European, Lebanese, and African traders, and due to a constantly rising export duty, only a small percentage of the proceeds from these exports entered the personal and group economies of Northern Nigeria colonial farmers and the federal colonial revenue pool, much of the wealth going to British shipping and produce-buying firms. This reality, to be sure, also applied to Southern Nigerian export producers.

What made the difference, then, in terms of Northern and Southern contributions to the federal colonial revenue pool was a constellation of natural and circumstantial factors. The agricultural resources of the South commanded higher prices in the world produce market than those of the North. The North's range of agricultural resources was narrower, owing to its ecological realities. The North was also more susceptible to crop failures, droughts, and reduced harvests than was the South. Thus, in the largely agricultural colonial economy of Nigeria, the South naturally provided the bulk of the colonial state's revenue.

The point here is that the discourse of colonial-era altruism and/or forced sacrifice which is being invoked by the North is a fallacy, as is the claim of Southern colonial-era altruism. The South's larger contribution to the national colonial treasury was not acquiesced to or consciously advanced by its people as an altruistic gesture, or a sacrificial act of brotherly love. On the contrary, it was compelled by colonial administrative and unitary imperatives, which were anchored on colonial goals and anxieties, not on the interests of Northern Nigeria. Moreover, the differential contributions to the national colonial treasury by the North and the South can and should be explained within the context of geo-ecological, and mercantilist realities; it should not be discussed as if it was a self-conscious act of selflessness by the South.

The pattern of greater Southern Nigerian contribution to the nation's coffers was disturbed with independence. It has been sustained and re-inscribed into the national order of things by the discovery and exploration of crude oil in the Niger Delta. Thus, instead of speaking in terms of ruptures and discontinuities with past colonial practice, arrogant and historically-ignorant Northern politicians should recognize the fact that there has actually been a remarkable continuity and consistency in the pattern of revenue generation and sharing as far as regional contribution is concerned. There have been two notable changes since the discovery of oil and since independence. First, the percentage of Northern contribution to the federal revenue pool has shrunk further, as agricultural exports have all but disappeared under the economic bazaar of oil wealth, which now makes up an alarming 85% of Nigeria's export earnings. Second, the discourse of Southern (or South-south) sacrifice and subsidy is empirically true of the post-colonial period, the dominating and oppressive political hegemony which sustains this reluctant sacrifice having merely changed from a colonial state to a post-colonial nation-state. The term "sharing," which was certainly true of the colonial period, can now give way to "subsidy."

These changes are peripheral and do not detract from the overarching fact that there has been more continuity in patterns of revenue mobilization and extraction between colonial and post-colonial Nigeria than there have been discontinuities, and that these curious continuities undermine the break with the past that is suggested by the fallacious claim of Northern colonial-era subsidy of the South. The subtleties and changes outlined above should also not vitiate the fact that, since 1914, Northern Nigeria has, for good or bad, been the beneficiary of state appropriation of regional and sub-regional resources. The reality of the post-colonial period, especially of the last two decades, is that the oil resources of the Niger Delta have subsidized the lifestyles, necessities, and comforts of the rest of the country. Another hallmark of this continuity between the past and the present is that, like the colonial state, the post-colonial Nigerian state, has not bordered to consult with the people from which it appropriates resources, forcing the Niger Delta, much like the colonial state forced Southern Nigeria, to make more contributions to the national treasury than other parts of the country by invoking the rhetoric of higher national interests.

In view of these historical realities, it is therefore the height of arrogance and insensitivity for Northern politicians and self-interested bureaucrats to continue to repeat the lie that the North had, in colonial times, subsidized the South with its resources and that this supposed historical fact justifies the on-going subsidy of the whole country (especially the North) by the oil resources of the Niger Delta. It is morally offensive when such a historical fallacy is used to dilute and confuse the just and moral struggle of the South-south for a fair share of the revenue derived from the exploration of its resources and for adequate compensation for the environmental degradation that it has to endure.

This argument is understandably typical of the arrogant and self-serving posturing of the Northern political class, which dreads the prospect of having to engage in the hard work of devising wealth-generating mechanisms for an endowed but impoverished section of the country. But it is an argument without historical basis. Even the more moderate and correct claim that the North shared its colonial resources with the South is useless as a response to the poignant questions thrown up by the latest derivation controversy-useless because both the North and the South had to share their resources with each other, since, by colonial decree, regional resources were amassed into a common pool without regard to the preferences of subalterns.

Let the Northern political class and its intellectual underlings come up with a better reason-if there is one-for opposing what is an incredibly generous act of accommodation on the part of the Niger Delta: the demand, not for all revenue minus taxes accruing from crude oil, but of a meager 25%. I hate it when history is subjected to such vulgar distortion in the attempt to scuttle an unpalatable event.

The Niger Delta people have accommodated the interest and survival of Nigeria through their reasonable demand for a graduated 25-50% derivation. Let us see similar acts of national preservation on the part of the North, and the West, and the Southeast.

Since I have broken with my own resolve and have dignified a counterfactual question, let me conclude by speculating on something so curious it may answer the question of what would happen if the oil were in the North. I have never ceased wondering why, after several decades of vehemently resisting the unitary outcome of the amalgamation and of curtailing its reach in Northern social and political life, the North suddenly changed course, the beginning of a rather fanatical Northern commitment to a federal Nigeria having even a semblance of national symbolic uniformity coinciding roughly with the discovery and exploitation of oil in the Niger Delta. It is very curious, and I have never been able to explain that dramatic Northern shift from a jealous and uncompromising guardian of regional autonomy and separatism to a fierce protector of an inherited post-colonial state structure. And I am not convinced that the shift came about solely as a result of the North's capture of political power at the center.