Privatization Nigeria

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PRIVATIZATION AND NATIONAL DEVELOPMENT IN NIGERIA:

A CASE STUDY OF NIGERIAS POWER SECTOR.

BY

ERUNKE CANICE ESIDENEREG. NO. NSU/SS/013/MSC/06/0

RESEARC! T!ESIS

IN PARTIAL FULFILLMENT OF T!E AWARD OF MASTERS OF

SCIENCE "M.S#$ !ONOUR DEGREE IN PUBLIC POLICY

ANALYSIS% DEPARTMENT OF POLITICAL SCIENCE%

NASARAWA STATE UNIVERSITY% KEFFI.

SUPERVISOR: MALLAM YAHAYA ADADU

DECEMBER% &00'.

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CERTIFICATION

I hereby certify that this research thesis on Privatization and National

Development in Nigeria: A Case study of the Power Sector has meet

the reuirements for the award of !"Sc #$ons% Degree in Public

Policy Analysis& of the Nasarawa State 'niversity& (effi"

)))))))))))))))))))))))) )))))))))))))))Chairman& Supervisory Committee Date

)))))))))))))))))))))))) )))))))))))))))*esearch Supervisor Date

)))))))))))))))))))))))) )))))))))))))))$ead& Political Science Dept" Date

)))))))))))))))))))))))) )))))))))))))))Internal +,aminer Date

)))))))))))))))))))))))) )))))))))))))))+,ternal +,aminer Date

)))))))))))))))))))))))) )))))))))))))))Dean& Postgraduate School Date

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DECLARATION

I hereby declare that this research wor- in its original form has been

carried out by me& +run-e Canice +sidene with *egistration Number

NS'.SS.!S"c./01./2./3 of the Department of Political Science&

4aculty of Social Sciences& Nasarawa State 'niversity& (effi"

)))))))))))))))))))))))) )))))))))))))))

E()*+, C-*#, E,*, Date

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DEDICATION

I humbly dedicate this research wor- to 5od Almighty for $is mercy

and the strength he has given me to carry out the study" +nough

respect goes to all lovers of democracy& good governance& peace and

stability across the world"

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ACKNOWLEDGEMENT

I wish to than- 5od Almighty for this wor-" !y humble

ac-nowledgment goes to my mum& !rs +lizabeth +run-e& my Sweet

heart 6lessing& and my little baby 5od 4avour +run-e" I am sincerely

indebted to my friend& Austin !bogo& +me-a 7ogu& 6ello

6abanuma& !r 'sman Abu 8om and all my Senior colleagues in

Political Science Department" I wish to recognize !aster 6eshiru Abu

for his computer s-ills and that he has put in this wor- to ma-e it a

success"

!ay I specially ac-nowledge my $9D and Dean of Social Science

4aculty Assoc" Prof" S"A" Ibrahim& !allam ahaya Adadu& my erudite

supervisor" $e has been of immense contribution to the success of this

research" !ay I recognize specially our vibrant academic gurus in the

Political Science Department& Dr" S"!" 9modia #Phd%& Dr" Abdullahi

amma #Phd%" 8his feat is not complete without mentioning my

overall mentor& Prof" Inno '-ae;e& Prof" Sam Amdii& Dr"


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TABLE OF CONTENTS

8itle Page>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> i

Certification>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> ii

Declaration>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> iii

Dedication>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> iv

Ac-nowledgement>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> v

8able of Contents>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> vii

?ist of Acronyms >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> viii

Abstract>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> i,

C!APTER ONE: INTRODUCTION0"0 Introduction. 6ac-ground to the study>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 0

0"@ Statement of the Problem>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

0"1 *esearch Buestions>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 2

0" *esearch 9b;ectives>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 3

0" *esearch !ethodology>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 3

0"2 Scope and ?imitations>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

0"3 *esearch $ypothesis>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> E

C!APTER TWO: LITERATURE REVIEW AND T!EORETICAL

FRAMEWORK

@"0 Privatization >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 0/

@"@ 8he Concept of Development>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 00

@"1 Privatization and Commercialization in Nigeria>>>>>>>>>>>>>>>>>>>>>>>>> 0

@" Privatization& ?iberalization and National Development>>>>>>>>>>>>>>> 03

@" 8he Concept of 'nderdevelopment>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> @0

@"2 8he Concept of +conomic 5rowth>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> @1

@"3 Privatization and ?iberalization in 5lobal Perspective>>>>>>>>>>>>>>>>>> @

@" Privatization of +nterprises in Nigeria >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> @

@"E Accountability in the Power Sector and Nigeria National

Development>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 1/

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@"0/ Privatization of P$CN and National Development in Nigeria>>>>>>>>>> 12

@"00 Challenges of Power 5eneration and NigeriaFs Socio>+conomic

Development>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 0

@"0@ NigeriaFs Power Sector *eform >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 0

@"01 8he Alternative +nergy 9ption>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 1

@"0 8heoretical 4ramewor->>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

C!APTER T!REE

1"0 *esearch !ethodology>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 20

1"@ 8he Study Population>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 20

1"1 Sampling 8echniues>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 2@1"1"0 Stratified Sampling>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 21

1"1"@ Simple *andom Sampling>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 21

1"1"1 Cluster Sampling>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 2

1" *esearch Instrument and Delimitation>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 2

1" !ethod of Data Analysis>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 2

1"2 Buota Sampling>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 2

1"3 Purposive or >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 2

C!APTER FOUR

"0 Data Presentation& Analysis and Interpretation>>>>>>>>>>>>>>>>>>>>>>>>>>> 22

"@ 8esting of $ypothesis>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 3E

"1 Discussion of *esults>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> @

" Conclusion.Inferences>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> @

C!APTER FIVE

"0 Summary >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> 1

"@ Conclusions>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

"1 Policy *ecommendations>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

*eferences.6ibliography>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

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LIST OF ACRONYMS

P$CN: Power $olding Company of Nigeria

P7D: Public 7or- Department

N+SC9: Nigerian +lectricity Supply Company

+CN: +lectricity Corporation of Nigeria

NDA: Niger Dams Authority

N+PA: National +lectric Power Authority

I!4: International !onetary 4und

76: 7orld 6an-

SAP: Structural Ad;ustment Programme

N++DS: National +conomic +mpowerment and Development Strategy

5NP: 5ross National Product

!D5: !illennium Development 5oals

ICPC: Independent Corrupt Practices Commission

+4CC: +conomic and 4inancial Crimes Commission

A*: Aso *oc-

ND: National Development

NIPP: National Integrated Power Pro;ect

NDP$C: Niger>Delta Power $olding Company

AI8: Africa Independent 8elevision

NASS: National Assembly"

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ABSTRACT

Nigerias public policy thrusts over the years towards the socio-

economic and political growth, development and sustainability of the

system is largely bereft with abject lack of direction and vision.

Hence, this research attempts a plethora of Privatiation and

National !evelopment vis-"-vis Nigerias power sector reform. #he

thesis argues that social responsibility is an integral aspect of good

governance and must be so guided with caution in the management of

the affairs of Nigerias public space in relations to the welfare of the

people at large. #he submission of this research is that the present

administrations bid to restructure the power sector does not seem to

have the re$uired answer to incessant power outage in Nigeria.

Hence, the nuclear energy option remains the available mechanism

for effective and efficient power supply in Nigeria. #he research sums

up with conclusion and policy recommendations for improved

performance of the already comatose power sector in Nigerias

%ourth &epublic and beyond.

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C!APTER ONE

INTRODUCTION

1.1 INTRODUCTION/ BACKGROUND TO T!E STUDY

8he Nigerian political economy is bereft with ab;ect lac- of policy

focus& development& progress& stability& efficiency& accountability&

participation and responsiveness on the part of state actors in the

socio>economic scheme of things" 8his is against the bac-drop of poor

governance arising from lac- of political will by the elite or ruling

class who have literally sabotaged the ailing Nigerian economy to a

stand still" Inspite of very many economic measures put in place to

cushion the harsh realities of our time& the various policies of

government have grossly remained at the level of rhetorics without

corresponding outcome" Conseuent upon the foregoing& there seem

to be no closer remedy geared towards revamping the Nigerian

cheuered economy& while infrastructures are decaying& value

orientation of both the elite and the governed are diminishing at an

alarming rate" Corruption through the art of siphoning billions of

public funds meant for ma;or infrastructural development #including

the embattled power sector% are diverted into private poc-ets with

impunity" All of these clearly define the sorry state of the present

Nigerian economy as part of the problems of underdevelopment"

8hings however& are falling apart in the affairs of governance in the

Nigerian state while the centre can no longer hold" $owever& it is

interesting to note that one of the most critical aspect of good

governance and social responsibilities on the path of the state system

is the provision of goods and services as well as ensuring efficient

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various situational constraints that follows such policy actions in

relation to the overall well>being of Nigerian citizens" 8he thesis also

considers the nuclear energy option as a veritable means of

sustainable power generation and distribution in Nigeria"

4or the purpose of clarity& there is the need to trace the ecology of the

Nigerian power sector from history and e,amine how it became

transformed to the present status of Power $olding Company of

Nigeria #P$CN% today" 8he history of the Nigerian power sector is as

old as colonialism itself" Power generation in Nigeria could be traced

as far bac- as 0E2 with the installation of the pioneer power station

in ?agos under the auspices of the then Public 7or-s Department"

8he process of transmutation then continued via the activities of

sta-eholders in the sector& namely& the ?agos State !unicipal

Authority" $owever& the emergence of the Nigerian +lectricity Supply

Company #N+SC9% latter in 0E@E witnessed an e,tension and

diversification of the power sector through the construction of the

famous (urra 4alls near the present


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It is interesting to note that the Niger Dams Authority was established

in 0E2@ with the mandate to further develop and enhance the

hydropower potentials of the country" $owever& the merger between

the +lectricity Corporation of Nigeria and Niger Dams Authority gave

rise to the abrupt change of nomenclature to the contentious National

+lectricity Power Authority #N+PA% in 0E3@ #Cole& 0E3@%"

Interestingly& however& the enabling Decree No" @ of 0E3@ gave the

necessary impetus to the merger of both the +CN and NDA& the

essence of which the procedure defines the critical economic&

technological and social development of the Nigerian state as a whole"

4rom the foregoing& therefore& electricity consumption in Nigeria has

become one of the most crucial indices of growth& development and

sustainabilities of both government institutions and the people at

large" 8hus& a deliberate and carefully planned effort by government

to institutionalize a good maintenance culture& due process& efficiency

and productivity in the power sector informs the present attempt to

relieve the pressures on the public sector& and hence place the

responsibilities of generation and distribution of energy in private

hands" 8he primacy of this research therefore highlights -ey areas of

concern aimed at revitalizing the ailing power sector for an enhanced

socio>economic growth& development and sustainability of the

Nigerian economy& in all its ramifications #+-po& 0EE3%"


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0"@ STATEMENT OF T!E PROBLEM

8he relevance and usefulness of any piece of research is determined to

a large e,tent by its ability to address fundamental problems ofsociety #Nigeria inclusive%" 8hus the Nigerian electricity dilemma

during the post>colonial era has been a ma;or constrain to socio>

economic and political development and sustainability" 8hus& ab;ect

lac- of electricity supply has largely institutionalized the culture of

absolute poverty& deprivation& want& unemployment& high cost of

generating sets& crippling of infant industries& down>turn of medium

and small scale enterprises& corruption& ineptitude& ineuality& lac- of

transparency and accountability& lac- of responsiveness& money

laundering& total blac-out& high maternal and infant mortality& lac- of

economic growth& development and sustainability& sudden change

from public sector to private>sector driven economy with its attendant

conseuences& to mention but a few" 8he fundamental uestions to as-

for the purpose of see-ing answers or solutions to the problem under

review are: why has Nigeria not been able to solve her problems of

persistent power outage while she is busy brandishing her big>brother

status before other African countries li-e Niger& 8ogo and 6eninG

7hat positive impact can privatization of the power sector bring to

the Nigerian economyG 7hy is there lac- of participation of Nigerian

citizens in the privatization e,erciseG 7hy has the privatization of thepower sector being s-ewed towards the interest of few wealthy

Nigerians to the detriment of ma;ority of the Nigerian masses" 7hat

could be the environmental effect of nuclear energy option adopted by

!r President and whyG 7hy has there been massive cases of


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vandalization& illegal connection& theft of P$CN power installations&

corruption and the li-eG 7hy is it that there is absolute lac- of faith

and hope on the current investigation on the power sector by

NigeriansG what is responsible for lac- of public participation& among

others" 8hese are ma;or problems demanding solutions as far as this

study is concerned" It is in the interest of the aforementioned that the

research is focused& hence& geared towards the possibilities of

enhancing power supply to all Nigerians in the @0st century and

beyond"

1.3 RESEARC! UESTIONS

4or the purpose of this study& the following set of research uestions

will be considered:

0" Does privatization of NigeriaFs power sector impact positively on

national economic developmentG

@" 7hat is the e,tent of civil society participation in the privatization of

NigeriaFs power sectorG

1" 7hat are the global implications of privatization of NigeriaFs power

sectorG

" $as the efficiency of NigeriaFs power sector any lin- with

privatization and divestiture of the sectorG

" Is the lac- of competition and enabling environment in Nigeria

responsible for the poor state of power supplyG

2" Privatization of NigeriaFs power does not imply e,press national

development in Nigeria"

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1.2 RESEARC! OBECTIVES

+ssentially& this research attempts to produce a theoretical e,planation

of the privatization policy in relation to NigeriaFs power sector and

how it affects national development" 8he following research

ob;ectives shall be considered:

i% 8o clearly define the relationship between privatization and the socio>

economic well>being of the Nigerian society"

ii% 8o fully understand the ma;or challenges on the part of the Nigerian

power reform as well as define appropriate measures out of the

dilemma"

iii% 8o ascertain the environmental cost implications of privatizing the

energy sub>sector in relation to the Nigerian political economy"

iv% 8o e,amine the implications of the global dynamics of privatization&

deregulation and di>vestment policies in Nigeria and Africa at large"

v% 8o evaluate the efficacy and commitment of the present

administration in her bid to probe public power funds that are being

misappropriated by public officials in Nigeria"

vi% 8o e,amine the environmental impact of nuclear energy option in an

attempt by the federal government to profer lasting solution to

epileptic power supply in Nigeria"

0" RESEARC! MET!ODOLOGY

8hus the researcher adopts the use of both primary and secondary

sources of data for a better understanding of the issue being

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researched" Primary sources of data therefore includes the use of

uestionnaires and observation as well as face>to>face contacts with

the respondents" 8he secondary source of data collection for the

research involves the use of information sources to include& among

others& government publications& ;ournals& periodicals& research

papers& magazines& papers presented on similar topic by scholars& to

mention but a few" 8his is to enhance the efficacy of the study" 8he

result of the sample will also be sub;ected to further empirical test

through the use of chi>suare& goodness>of>fit to enhance viability andscientific outloo- of the research"

1.6 SCOPE AND LIMITATIONS

8his research see-s to loo- at the policy underpinnings of

privatization of NigeriaFs power sector and its implications on the

nationFs development process within the 9basan;oFs regime #0EEE )

@//3%" +ssentially& NigeriaFs socio>economic policies in the @0st

century attaches primacy to the issues of privatization& liberalization&

divestment and deregulation which are concepts and practices a-in to

the 6retton wood system of the I!4.7orld 6an-" 8hus& the thesis

e,poses the researcher into further evaluation of the aforementioned

as well as assessing the level of significance on the political& socio>

economic and cultural lives of the people and the Nigerian nation

state"


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6y e,tension& however& the limitations and constraints of this study

encountered are enormous" 9f utmost importance is the time factor&

finance& inadeuacy of documented materials for research& to mention

but a few" All these are ma;or encumbrances on the path of the

researcher in the process of carrying out this onerous tas-"

1. RESEARC! !YPOT!ESIS

8he following hypotheses were drawn to guide this research"

0% 8here is a relationship between national development andprivatization of NigeriaFs power sector"

@% Privatization of the power sector does not have the potential of

enhancing efficiency of power supply in Nigeria"

All the above mentioned hypotheses shall be tested through the use of

uantitative analysis to accept or re;ect them"

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C!APTER TWO

LITERATURE REVIEW

&.1 PRIVATIZATION

8he concept of privatization is multidimensional in outloo-" In the

first place& privatization could be used to mean the tendency where

government shares are sold to private investors" 8his definition means

that such government enterprises and its ownership are now being

transferred to individuals while government only step aside as a

regulatory agent #Pan Africa Summit& @///%" 6y e,tension therefore&

the concept of privatization does not in anyway suggests outright sale

of government property per se" It however partially removes

government from the scene as rightful owner while at the same time&

ensuring governmentFs regulatory roles to chec- abuses of the mar-et

focuses #7ogu& @//3%"

5oing by the foregoing analysis& it is the opinion of the researcher to

add that there is therefore a moral lin-age between the concept of

privatization and national development" $owever& the concept of

development here can be said to be a vague concept" Privatization

therefore may not necessarily enhance socio>economic development"

Development in this sense& can be used in its actual sense to refer to

individual human and societal growth& progress& increased s-ills&

sustainability& high standard of living& low death rate& high level of

literacy& absence of diseases& low crime rate and absence of

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corruption" #'sman& @//1% Development at the national level portends

capacity utilization and institutional building& structural

differentiation& nation>building practices& better and sustainable socio>

economic policy options" 8his appears to be the actual lin-ages

between the privatization policy and national development in Nigeria"

Similarly& the researcher is here left with no option than to emphasize

that privatization is an adaptation of liberalization" 8he two concepts&

however& are mutually reinforcing& liberalization in its real sense

therefore could mean some level of openness& removal of obstacles&restrictions& e,cessive tariff and regulation" 8herefore& we can also say

that a liberalized economy is an open economy& free and competitive

economy where everyone is at liberty to compete in a free mar-et

system aimed at profit ma,imization #Coo- and Patric-& @///%"

&.& T!E CONCEPT OF DEVELOPMENT

Development has been interpreted in different ways by different

people" $owever& this study embraces both traditional& dependency

and the contemporary or new development thin-ing"

6y e,tension& traditional development means the capacity of national

economy& whose initial economic condition has been more or less

static for a long time& to generate and sustain an annual increase in its

5ross National Product #5NP% at a fairly progressive level #8odaro

and Smith& @//1%" $owever& to this researcher& development within

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this conte,t is purely economical and the economic inde, as above

may not necessarily reflect the living conditions of the people in

NigeriaFs privatization process" It is the conception of this researcher

that the benefits of privatization policy in Nigeria should e,tend to all

segments of the society" 8his process is referred to as tric-le>down

effect" 6esides& development by implication can only be given the

rightful coloration in terms of change& new innovation and meanings it

brings to the lives of the people #*ogers& 0E2E%"

5oing by the foregoing analysis& development can be used as a

synonym of westernization" 8his means for a nation>state to subsist& it

must therefore embibe the cultures and traditions of the western

capitalist worlds of +urope and America" In the light of the above&

A-e #@//0% pointed that development is modernization and the latter

is eual and proportional to the former" 8o A-e #@//0%& development

is an off>shoot of capitalism and the two concepts are mutually

reinforcing" 8hus we can clearly see from his school of thought that:

' (n its most common form, moderniation theory posits

an original state of backwardness or underdevelopmentcharacteried by, among other things, a low rate of

economic growth that is at least potentially amenable to

alteration through the normal process of capital. #hisoriginal state of backwardness is initially universal.

)ccording to the theory, the industrialied countries

have managed to overcome it. )ll the other countriescould conceivably overcome backwardness too it they

adopted appropriate strategies' *+/0.

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4rom the foregoing& it can be deduced that development can be made

possible through the replication of western paradigm of socio>

economy development" 6ut the gap in this literature as it relates to

Nigerian privatization process is that virtually all economic measures

used in developing countries are merely pac-aged and delivered to us

from the 7est" And these pac-ages are alien to African cultures and

practices" 8herefore& the options can scarcely find a fertile ground to

subsist in the African soil" 8herefore& privatization& inspite of its

seemingly relevant postures& may not yield the reuired results in

terms of national growth& development and sustainability"

$owever& the disappointing performance of most 8hird 7orld

countries of Africa& Asia and ?atin American may well suggest the

move towards a new thin-ing of development practices" 8his is to say

that mere increase in per capita income without a corresponding

euity and fairness in the distribution of socio>economic good could

bring about disparity& poverty& disease& hunger& illiteracy& high level

social malaise& e,am malpractice& corruption in both high and low

places& epileptic power supply and gross indiscipline in the Nigerian

system as a whole #A-e& @//0%"

8hese phenomena can aptly be described as growth without

development which shows that every other approach to national

development is traditional and fall short of acceptable standard of

socio>economic development thin-ing" $ence there is every need for a

shift in paradigm in order to properly address development problems

of 8hird 7orld countries"

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According to Seers #0E2E%:

#he $uestions to ask about a countrys development are

therefore what has been happening to poverty1 2hathas been happening to unemployment1 2hat has been

happening to ine$uality1 (f all three of these have

declined from high levels, then beyond doubt this hasbeen a period of development for the country concerns. (f

one or two of these central problems have been growing

worse, especially if all three have, it would be strange tocall the result 3development even if per capita income

doubled *4546+0.

4rom the above e,cepts& development therefore means the welfare&

euality and sustainability of the people at large" 8hus& the meaning of

development is one that ma-es people the target or end of

development" Development is thus the process by which people create

and recreate themselves and their life circumstances to realize higher

levels of civilization in accordance with their own choices and values

#A-e& @//0%" 4rom this conte,t& development can be seen as

multidimensional process involving ma;or societal changes in terms of

social structures& popular attitudes and national institutions& as well as

the acceleration of economics growth& the reduction of ineuality and

eradication of e,treme poverty"

Conversely& *odney #0E3@% sees development from the point of view

of the individual in terms of s-ill acuisition and development&

increased capacity& greater freedom& creativity& self>discipline&

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responsibility and material well>being" At the societal level&

development entails the ability of man to ta-e his destiny in his own

hands" 8herefore& development means an overall social process which

is dependent upon the outcome of manFs effort to subdue his physical

or natural environment" Conversely& development at whatever level of

analysis precludes uneual relations and contact between the forces of

capital and peripheral nation>states" 8his is the result of dependency in

8hird 7orld today" 9f course& this is the direct conseuences of

numerous austerity measures adopted in undeveloped world includingthe emerging trends of privatization policies& #9ffiiong& @//1%"

&.3 PRIVATIZATION AND COMMERCIALIZATION IN

NIGERIA

Privatization and commercialization are popular elements in the

process of deregulation in Nigeria" 8he two concepts are however&more specialized processes of government disengagement from those

economic functions which it now underta-es but which can be more

efficiently carried out by others& in the case of privatization #9laghore&

0EE0%" Similarly& commercialization connotes the differences between

ownership and dependency because government retains ownership but

severes the umbilical cord of dependency so that the enterprises can

operate commercially without any subvention from government

#9lashore& 0EE0%"

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In the past& privatization and commercialization has become very

critical socio>economic indices for growth& development and

sustainability in Nigeria" 8here is therefore a fair amount of consensus

that the oil boom of the 0E3/s in;ected the confidence into the public

sector about its central role in economic management" 8his new

philosophy of the oil boom era was encouraged by the fact that

indigenes were generally capital deficient and could not afford to

invest adeuately in most industrial ventures" 8hese inadeuacies left

the commercial sector largely in foreign hands& ma-ing the

indigenization programme inevitable if Nigerians were to have

meaningful role in the economy" 8o those in charge in those times&

government had an obligation to hold a sta-e in trust for the people of

Nigeria"

As critical and well meaning as the foregoing may have been& the

participation of government in the economy too- on a life of its own"

5overnment itself participated in all -inds of ventures including steel

production to road haulage& clearing and forwarding services as well

as importation and distribution of consumer goods #9lashore& 0EE0%"

Shortly after the oil boom flopped& the burden of funding the public

sector became too much for government" 8herefore& there was the

need to reduce the burden of dependency by the companies and

parastatals of government on the public purse& and the desire for

increasing efficiency by government>owned companies whose

inefficiency was causing government much embarrassment and

costing the public much money in losses& led to the consideration of

privatization and commercialization" $owever& an enabling Decree to

02


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this effect did not come into place until 0E" Speculation gave the

impression that ideological and regional balance considerations may

have had the effect of delaying movement on privatization and

commercialization" 8he ideological issue was played up by those who

saw a cleavage between the haves and there have>nots with the haves

supposedly waiting on the wings to buy up for their personal gain& that

which belongs to all Nigerians" 5overnment must& therefore& have felt

the need to proceed with some caution on the sub;ect allowing a

process of information dissemination to help prepare people for the

reality of the need for privatization and commercialization which has

become part of NigeriaFs political economic inde, to date"

&.2 PRIVATIZATION% LIBERALIZATION AND NATIONAL

DEVELOPMENT

Privatization& liberalization and national development are concepts

that cannot be treated in isolation" Privatization and liberalizationtherefore are more or less development strategies imbibed by nation>

states to enhance the growth& stability and progress of their home

countries" As earlier mentioned in the preceeding chapters& to

privatize means to reduce government involvement in the

management of socio>economic affairs of a nation>state" 6y e,tension

therefore& the implication of this is to free up resources for private

ownership while government serve as regular or watch>dog"

?iberalization therefore appears to have the same connotation with

03


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privatization as the former is aimed at opening barriers to foreign

investors who may be willing to invest #9lewe& 0EE%"

4rom the foregoing& there appears to be a lin-age between

privatization& liberalization and national development because the

effective administration of privatization could in some respect bring

about change& progress& development and sustainability in the overall

socio>economic spheres of lives" Privatization and liberalization and

its policy directions therefore must be people>oriented& guided bysound moral ;udgement and ethical conduct& good political will&

transparency and accountability& responsiveness& participation and

democratization" All these variables have the capacity and potentials

of -ic->starting an oiling economy li-e those of 8hird 7orld countries

#Nigeria inclusive% #N++DS Document& @//%"

6y any standard& to privatize therefore means to try to avoid economic

waste& corruption and mismanagement creation of ;ob opportunities&

encouraging foreign investors& among others #9-igbo& 0E2%" 8his

researcher if of the humble opinion that the Nigerian privatization

process may not yield the desired e,pected results in terms of national

development" 8his is owing to the fact that the managers and actors of

the state seem to lac- focus and direction in the privatization policies

in the country" 8he staggering revelations in the 9basan;oFs 4ourth

*epublic where billions of ta, payerFs money have been cornered to

0


28/106

families and friends in political businessH sumptuous contracts offered

to bidders without proper inspection& among others as is being

revealed in the current and on>going investigations by the National

Assembly of Nigeria" All these are ma;or set>bac- on NigeriaFs path to

greatness" All these are artificial creations that may hinder the

realization of NigeriaFs vision @/@/ as being conceived by the arF

AduaFs administration"

Conseuently& the concept of national development according toArvinal and +verett #0EE% is a widely participatory process of

directed social change in any given society intended to bring about

both social and material advancement including greater euality&

freedom and other valued ualities for the ma;ority of the people

through active participation and greater controls over their

environment in all its ramifications" 7ith specific references to the

emerging economies of 8hird 7orld& 9lewe #0EE% has documented

that development>centered programmes and policies designed in these

economies are aimed at achieving higher incomes and living standards

through industrialization and modernization& e,pansion of social

services and cultural activities& full e,ploitation of human and material

resources among others"

?i-e privatization and liberalization& national development plans are

more or less aimed at achieving ualitative transformation from a

0E


29/106

particular level to a more desirable one" 8hus the transformation

should be rooted in such a manner that the e,penditure on national

resources should be able to improve upon the living standards of the

citizenry #7aldo& 0E%" As a encompassing pro;ect& national

development plan represents a demonstrated commitment of the state

leadership to deploy national resources& human and capital to secure a

better living standard of the people" 8hese is therefore the tendency to

reduce national development plan to or euate same with economic

development" 8he former however has a larger scope spanning allaspects of a countryFs national lives be they political& cultural or

economic"

9-igbo #0E2% wrote that since NigeriaFs first National Development

Plans of 0E2@& all other plans have largely remained the same

including the latest N++DS initiatives" $owever& the process of

preparing national development plan entails the setting of goals and

targets e,pected to be attained within a specific period of time" 8he

process also involves the formulation of appropriate policies aimed at

facilitating the accomplishment of stated goals and targets" 8o this

researcher& one very crucial factor that must be ta-en into cognizance

during any planning process of development plan in the ob;ective

assessment of resources to be e,pended on the plan" 8his is very

important against the bac-drop of the fact that insufficient resource

base constitutes a ma;or constraints to the overall realization and

@/


30/106

achievement of development goals or set targets" National

Development in Nigeria should therefore be pursued with the desired

vigour& coloration and determination as well as sound political will"

8his is certainly a way forward in NigeriaFs bid to become the worldFs

@/thmost industrialized nation>state"

&.4 T!E CONCEPT OF UNDERDEVELOPMENT

8here are different views by different scholars on the concept of

underdevelopment" *odney #0E3@% wrote that underdevelopment is

not absence of development" 8his is because every people have

developed in one way or another and to greater or lesser e,tent

underdevelopment therefore ma-es sense only as a means of

comparing levels of development" It is very much tied to the fact that

human& social and economic development has been uneven& and from

a strict economic sense of the word& a section of human race haveadvanced further in terms of technology& manpower and wealth for

more than others" 8his is the direct result of undevelopment"

8o this researcher& the main pro>occupation here is with the

differences in wealth between +urope and North America on one hand

as well as Asia& ?atin America and Africa on the other"

Comparatively& the second category can be said to be witnessing

misery& dwindling basic social infrastructures& corruption& thuggery&

insecurity of lives and property among other social vices" All these

@0


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appears to impediments to development" Another critical aspect of

underdevelopment can also be e,pressed in terms of a particular

relationship of e,ploitation between& for e,ample& the capitalist west

and the poor nations of Africa& Asia and ?atin America" According to

9ffing #0E/%" African and Asian societies were developing

independently until they were ta-en over directly or indirectly by the

capitalist powers of +urope" 8he tradition of this level of e,ploitation

and ineuality was further transferred into the very fabric of African

comprador bourgeoisie class" 8his eventually has been part of us and

hence& there is tric-le>down effect on the entire socio>economic

process" 8hus& the Nigerian privatization policy is hinged on colonial

mentality that is more or less unacceptable to the people" Privatization

policy at whatever level of analysis in Nigeria is a thing of the few

Nigerian elite at the helm of affairs of governance" 8he power sector

and its reform strategies have been grossly high>;ac-ed by the powers

that be and the loot unconventionally shared among family and

friends& government acolytes and good boysF running around for the

incumbent" At the same time designated power sites have been

literally abandoned to their own fate while billions of naira are being

lost without anybody accounting for it" Nigeria however& seem to be

relying on the power>probe panel headed by senator +lumelu as a way

out of this sorry state of the Nigerian power sector in recent times"

@@


32/106

&.6 T!E CONCEPT OF ECONOMIC GROWT!

8he conte,tual issues in NigeriaFs privatization process can be said to

be synonymous with economic growth" 8he contention here is that

there cannot be privatization without adeuate and viable socio>

economic growth" 8he two concepts therefore are mutually

reinforcing as well as complementing for overall economic

development and sustainability of any society at large" 6y economic

growth& is meant the ability of any given economy to provide goods

and services& increase human development and capacity& ;ob creation&

poverty alleviation& provision of infrastructures& etc" 6roadly

spea-ing& economic growth occurs as the economy increases its

human and natural resources and plans how to employ them more

productively #5bosi& @//0%"

4rom the economic bac-drop& it is easy to consider the concept of

growth from the level of increase in 5ross Domestic Product #5DP%&

5ross National Product #5NP% as well as Net National Product #NNP%

respectively" Political scientists however hold contrary views on the

concept of growth" 8o them economic growth which does not reflect

the interest& aspiration& welfare as well as guarantee the greatest

happiness for the greatest number cannot be called growth in the sense

of the word" 8his means however& that there can be economic growthwithout development and sustainability as in the case of Nigeria #A-e&

@//0%" Conseuently& available data shows that the various macro>

economic policy measures adopted in Nigeria apparently have not

achieved the desired result" !a;or factors however& are responsible"

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4rom all indications& the Nigerian economy is basically characterized

by rising levels of unemployment& high food shortages& inflation&

poverty and hunger& disease pandemic li-e $IJ.AIDS& e,am

malpractice& electoral malpractice& high crime rates& prostitution& rape&

child abuse and traffic-ing& among others" All of these are basic

economic indicators to show that NigeriaFs privatization process is

still a sham and& so& privatization and socio>economic growth are

poles apart in the scheme of things in Nigeria #9gbosi& @//0%"

4rom the foregoing analysis therefore& it becomes difficult to compare

or rather euate the Nigerian privatization process with economic

growth because within this framewor-& there can be growth without

corresponding development" 8he astronomical increase in NigeriaFs

foreign reserve arising from sale of e,cess crude oil in recent times

have only left more Nigerians in the dar- while the rhetorics of ar

AduaFs Seven>Point Agenda& of which the power sector ta-es the top>

most priority& is only at the level of policy statement" Nigerians are

still waiting patiently to have such policies translated into creative and

meaningful outcome in the interest of over 0/ million citizens"

&. PRIVATIZATION AND LIBERALIZATION IN GLOBAL

PERSPECTIVE

5lobalization means different things to different people" Privatization

has come to mean the same thing with the concept of globalization"

8his is because privatization li-e& liberal democracy is a gospel of

+urope and America meant to collapse the entire world system into a

@


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global village" 8hus& the world has now become bigger and comple,

in outloo- with near free entry and e,it in terms of mar-et formations&

fewer barriers& faster and better communications and transport

lin-ages& freer and easier and more global capital flows& large and

vicious competition for mar-et at both local& national& regional&

international and& in fact global levels #(ande& @//%" 8hus

organizations and nations state are constantly repositioning for their

own advantage as product cycles and design cycles have become

shorter bringing about faster reaction cycles"

4rom the foregoing& privatization and liberalization have almost

become a collective development responsibility of nation>states with

each synchronizing and harmonizing its socio>economic& political and

cultural interests with other nations of the world" 8he import of the

mutual relationship& to this researcher is largely to share with others

the responsibility for repair and maintenance of building natural

development plans for overall socio>economic growth& development

and sustainability" Privatization and liberalization in global

perspective therefore preoccupies itself with the setting of bench>

mar-s and the adoption of new innovations and best socio>economic

practices& discipline and the aspirations to -ic->start ailing economies

of bac-ward and nations of the world" 5lobalization and liberalization

therefore is not only an African content" It is a practice emanating

from the 7est& and then& imposed on undeveloped worlds as a way

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out of misery" In Africa as a whole& various concerns have been

e,pressed on anticipated benefits of privatization and liberalization"

Central to this school of thought are uestions of ownership& the fate

of labour& the idea of transparency& the socio>economic implications

of these practices and the considerations of social contracts and

responsibility and responsiveness on the part of state actors in the

interest of all and sundry #7ogu& @//3%"

$owever& social science scholars who have professed privatizationand liberalization have eually outlined long term advantages&

particularly in the area of promoting economic growth& development

and sustainability" A critical assessment of this trends of global

dimension could and of course& may sub;ect 8hird 7orld states on

highly disadvantaged position" Conversely& despite the many sides of

privatization and liberalization as a universal tradition& the issue of

ownership and participation becomes a ma;or stumbling bloc- in the

development concerns of the people of Africa #A-e& @//0%" 9f utmost

interest to this researcher is that these appears to be gross absence of

any form of mass privatization or capitalization programme anywhere

in sub>Saharan Africa"

It is therefore indisputable that privatization process in Africa& li-e

those of the +uropean countries of 6ritain& 5ermany& Ireland& among

others& have been very slow" $owever& it is not surprising to eually

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;udge the low level of performance and subsistence of privatization

programme in this part of the world due to general lac- of

transparency& low political will& corruption and lac- of policy

implementation on a general scale #+run-e& @//3%" 8his scenario

appears to be an e,isting gap in literature as it concerns privatization

and liberalization in global scale"

Apparently& the +uropean 'nion appears to have created a single

mar-et for goods and services in the 0EE/s in principle" In actualpractice& many barriers to cross border transactions have remained in

place #Cole& 0EE%" A glaring case of cross>border distortions assumes

greater dimensions when one consider the upward and.or downward

swing of global crude oil prices in the international mar-et until

recently where there appear to be sudden s-yroc-eting of crude oil

prices" 8he researcher is of the view that while privatization and

liberalization in +urope #especially in such areas as telecom&

education& railway and water supply& among others% and America has

assumed a successful dimensions& African privatization process has

failed #Cole& 0E%" 4or e,ample& the +uropean 'nion Commission

has vowed to continue to promote access to local loop to force down

call charges and internet costs" 8his is rather strange in the African

conte,t" Nigeria& for e,ample has restricted its communications

industry to only few companies #!8N& KAIN& !8+?& and 5?9

networ-s%" 8his largely accounts for why there has been poor networ-

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and service delivery in recent times" $owever& it can be argued that

the liberalization of the energy sectors in +urope has proved

considerately difficult in recent times" $owever& in @//@& the +'

reached an agreement for full energy liberalization by @//3 which was

a ma;or step forward" Needless to say that +' countries li-e 4rance&

6elgium& 5reece and Ireland& for e,ample& still control about E/

percent of the electricity mar-et #!a;one& @//1%" 8hese uasi>

monopolies use their dominant position to -eep out competitors" It is

rather very doubtful that without the push from the +'& thesecountries would have succeeded in opening their energy mar-et for

competition #!a;one& @//1%"

&.' PRIVATIZATION OF ENTERPRISES IN NIGERIA

8he abrupt sale of public enterprises in Nigeria has been one of the

problems in the Nigerian privatization strategies to date" 8he way and

manner that most enterprises are sold have been the sources of

contentious debates among scholars" According to (ande #@//%& the

problems of privatization in Nigeria is fraudulent and unfair" 8hus& the

e,ercise is bedeviled with lac- of proper valuation& incompetence on

the part of the valuers& fraud and high>level lac- of technical s-ills

#@//:2%" Similarly& there is also the issue of assets& which in some

instances& are not ta-en into account in the evaluation process" 8his

practice is inimical to NigeriaFs economic growth and development"

At the level of the private sector& the process remains inhuman&

@


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insensitive& callous and e,ploitative" 8here is virtually no safety nets

for employees of such sectors" 8hus& many of the private sector

employers neither provide insurance nor social security for their

employees" 8hey do not obey labour laws and therefore sac- wor-ers

arbitrarily& for good or bad reasons" !any of them do not have

pension schemes" It can be deduced from the above that the private

sector is a very hostile environment" 8hey do not in some cases permit

their employees to even unionize"

8hus& while inaugurating the National Council on Privatization&

president 9basan;o #as cited by (ande& @//:3% stated thus:

7tate enterprises suffer from fundamental problems of

defective capital structure, e8cessive bureaucratic

control or intervention, inappropriate technology,gross in competence and mismanagement, blatant

corruption and crippling complacency which

monopoly engenders. )s a result of the foregoing, we

are privatiing for the benefit of our economicrecovery and benefit of life'. 2e are not about to

replace public monopoly with private monopoly.&ather in our determination to be unyielding and

uncompromising in the best interest of this country,we want to remove the financial burden which these

enterprises constitute on the public and release

resources for essential functions of government*+99:0.

Incidentally& the researcher is of the view that several issues can be

decoded from the policy statement of !r President" Again& the issue

of morality in the entire e,ercise comes to the fore as in the above"

8he poser therefore is: If government is not trying to hand over the

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country to a few comprador bourgeoisie class in Nigeria as in the case

of the erstwhile 9basan;o regime& how should it e,pect the ma;ority

poor and the already impoverished masses of the people to afford

colossal capital and resources needed to acuire such enterprisesG If

the government was not replacing state monopoly with private sector

monopoly& why would she not emphasize on private sector e,pansion

and development of their various business empires instead of buying

over those whose original owner is governmentG $owever& the

presidential speech of NigeriaFs 4ourth *epublic can be reduced to

two critical issues ) those of over politicization and poor management

of our national resource endowment" +verything else within the state

derives from the above #9badan 0E01%" Indisputably& however& the

plenary speech appears to be shielding the role of government by way

of poor handling and management of state enterprises" Interestingly&

however& the same government and its agencies are involved in or

ine,tricably constitutes the 6oards of management of public

enterprises" So it becomes difficult to ;ustify the position of

government on enterprises failure in Nigeria #9;o& 0EE%"

&.5 ACCOUNTABILITY IN T!E POWER SECTOR AND

NIGERIA NATIONAL DEVELOPMENT

8he content and conte,t of national development as it relates to the

Nigerian current trend in the power sector reform strategies is a

misnomer" Incidentally& every national development plans is largely

people>centred geared towards achieving ualitative transformation

from a particular level to a more or less desirable and progressive one"

1/


40/106

8hus& the same level of transformation is tailored around e,pending

national resource endowment at the levels of both human and material

dimensions in such a manner that could bring about improved material

conditions for the generality of the citizenry" In a more broader

perspective& national development strategies represents a

demonstrated commitment of the leadership and of course& the

followership& good political will and vision and mission" All these are

necessary variables that could rightly generate the desired results and

dire aspirations for a wor-able national development inde, in allspheres of our national lives& the Nigerian power sector inclusive"

6y any standard& Nigeria& the most populous blac- African country

with an appro,imate population e,plosion of not less than 0/ million

had under its N++DS agenda& and in line with the much tal-ed about

!illennium Development 5oals #!D5% earmar-ed monumental

development strategies for an enhanced living conditions of her

people& of which the power sector reform is one" 8he Nigerian power

sector as a matter of fact& is an indispensable sector the reuires

utmost attention in order to be effective and efficient in all its

ramifications" Power& however& is very crucial in boosting business

activities either at the level of individual or government circles

respectively" 9n the other hand& NigeriaFs fledging democracy may

only survive the test of time thereby enhancing socio>economic

development& growth and sustainability when the fundamentals of due

10


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process and the rule of law are duely and systematically followed

#8he News& @//%"

8herefore& the on>going investigations by the ar AduaFs

administration appears to have come as a right step in the right

direction to bring to the fore all tendencies of grafts and corrupt

legacies of the immediate past administration of chief 9lusegun

9basan;o and his cronies in government circles" It is interesting to

note that the various mind>boggling revelations that played out in theon>going public hearing by the National Assembly of Nigeria to

actually salvage the comatose state of the power sector is of utmost

interest to this researcher and any concerned citizen of this great

country" 8hus a close e,amination of such aw-ward leadership

tendencies as hypocritical& non>challant& self>aggrandizement&

window>dressing& coverteousness greed etc& are prevalent and& hence

act as necessary draw>bac-s to our nationFs wheel of progress"

8hese tendencies are basically characteristic of the 9basan;oFs

administration where sumptuous contracts worth billions of Nigeria

were distributed to both family and friends to the detriment of our

national development plans #8he News& @//%"

In one of the most startling revelations& the out>gone C6N 5overnor&

Prof" Soludo told the Committee investigating the power saga that the

1@


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Central 6an- of Nigeria paid a whooping sum of NE03" billion on

the power sector contracts" According to him& out of this figure&

N@@"@ billion was paid for ;obs done locally while N"@ billion was

eually redressed for items sources abroad #8he 5uardian& @//%" It

was also revealed that N02"@ billion was paid to a 5erman company

who does not -now the road leading to the pro;ect site& neither was the

contract supervised and religiously e,ecuted #8his Day& @//%"

8estifying before the $ouse Committee on Power and Steel& theformer !inister in the ministry and current governor of 9ndo state&

Chief 9lusegun Agagu shoc-ed Nigerians when he said it was not

within his schedule to -now whether companies bidding for contracts

were registered or not #8he 5uardian& @//%" 8he humble suggestion

and ample opinion of this researcher is to say very well that any

public office holder who does not -now his constitutional

responsibilities may li-ewise be e,pressing his share irresponsiveness"

8his does not apply in our national development pattern as a matter of

fact"

5iving his own account which rather concealed more than it revealed&

another former !inister of Power and Steel and now present governor

of Cross *iver state& Senator ?iyel Imo-e alledged that he had no

-nowledge of how some contractors were paid up to 2/ ) 0//L

mobilization fees without evidence of first>phase performance #Daily

11


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8rust& @//%" 8his scenario also is a misnomer and hence suggests

traces of sycophancy at the level of top bureaucracy during the said

period of 9basan;oFs administration" +ventually& however& Nigerians

were not fooled by a team of praise>singers who were literally bought

over within the Abu;a vicinity to applaud and distract proceedings to

cover up this singular evil" Incidentally& a close e,amination of the

testimonies of Nigerian public office holders as above shows clearly

that no body seems to be bothered about the impact of the power

sector scandal and the implications on our growing or dying economy"8here is also a deliberate attempt here to play down the issue and

cover up the roles played by former president 9basan;o in throwing

away huge public funds without due process and accountability and

responsibility" Nigerian public office holders at this level have largely

remained remorseless as a result of the culture of impurity entrenched

and institutionalized by the former administration which is notorious

for this -ind of leadership traits" 8he most critical and dominant

picture of this scenario is that of a bloodiest attempt to conceal

corruption& criminality and e,ecutive rec-lessness& cover>ups& greed&

avarice& self>aggrandizement and convenience at the e,pense of public

interest" 8his constitutes a serious setbac- to overall national

development in Nigeria #?eadership& @//%"

Against all odds& it will be recalled that the emergence of president

9basan;o through the beginning of the first phase of Nigerian

1


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democratic e,periment was greeted by higher ethical standard

initiated by the same regime and further transposed into the Nigerian

public life geared towards decapitating and incapacitating the monster

of corruption" 8his appears to be the bac-ground from which the

Independent Corrupt Practice Commission #ICPC% and the twin

+conomic and 4inancial Crimes Commission #+4CC% were created

with the hope of stamping out corruption in public lives in Nigeria"

8herefore& corruption as one of the impediments that causes NigeriaFs

bac-wardness thereby distorting national development and thecorresponding regeneration of ICPC and +4CC generates a lot of

enthusiasm and e,citements that at least Nigeria has a saint in the

most powerful public office in the history of the country"

4rom the foregoing analysis& Nigerians are now beginning to

understand why the eight years of democracy under 9basan;o did not

bring any significant improvement in the uality of lives of millions

of Nigerians" 9nce can as well understand the shortfall and glaring

hypocracy coming in the hills of the so>called anti>corruption crusade

introduced to institutionalize sanity in the same system of wrongs in

Nigeria"

In any case however& the anti>corruption gospel is now facing its own

credibility problem" 6ut will arFAdua muster enough courage and

goodwill to investigate his predecessor with the trend of window>

1


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dressing scenario we have had in such cases involving past leaders in

this countryG 7ill the powerful political elite in Aso *oc- who

probably are parta-ers in this orchestra ever allow fair>play&

credibility and transparencyG Nigerians are however waiting with high

level of enthusiasm to see what the outcome of this current power

probe loo-s li-e at the end of the day"

&.10 PRIVATIZATION OF POWER !OLDING COMPANY OF

NIGERIA "P!CN$ AND NATIONAL DEVELOPMENT

National development as a concept finds e,pression in virtually every

facet of our national lives as a nation>state" 8he Nigerian socio>

political system therefore becomes the centre>piece of development

agenda carried out by government in the interest of the entire

citizenry" Privatization therefore as an appendage of government

policy becomes crucial in any development thin-ing especially as it

relates to power sector and how the same impacts on the welfare of

the people"

8he researcher is of the view that privatization of NigeriaFs power

sector and national development are two sides of the same coin" 8his

is strictly because of one singular reason that the agenda of privatizing

any sector into private trends is to avoid the ills perpetrated by the

public sector including& among other things& corruption& waste&

mismanagement& ineptitude and lac- of will power to control public

12


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resources in the interest of public goods" 8hese appears to be the

ma;or reasons for privatization in Nigeria" $owever& one stri-ing

contradiction is that Nigeria has found it difficult to move on her road

to development inspite of huge sums of money dished out from the

ta,>payerFs money for developmental purposes" 8he uestion is: who

is actually responsible for this state of affairsG Again& can this scenario

impede or retard developmental efforts in NigeriaG 8hese and many

other uestions form part of the discussion to water>down the concept

of national development as it relates to the P$CN in Nigeria"

8he contention in this study his that privatization in Nigeria does not

necessarily translate into national development" Privatization and its

twin policies of deregulation and liberalization are wor-ed out in

favour of a few comprador bourgeoisie class" 8hey include the powers

that be namely& government& cronies and acolytes& state machineries

and top bureaucrats respectively" 8hese are ma;or obstacles to

NigeriaFs growth& development and sustainability #8he News& @//%"

8hese agents of government have literally high>;ac-ed the goodwill

and aspirations of public policies and converted the same into private

initiatives in favour of themselves& business associates& their family

and friends at both home and abroad #+run-e& @//3%" 8he afore>going

does not by any standard guarantee accountability& transparency and

probity in the scheme of things" 8here is therefore no survival and

smooth ;ourney to nationhood" 9f particular interest to this study is

13


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48/106

the pro;ect involves the construction of new power stations& mostly in

the South>South zone" 8he gas power plant is therefore to be managed

by the Niger>Delta Power $olding Company Plc #NDP$C% including

those of Calabar in Cross *iver state& +gbema in *iver state& Sepele in

Delta state& respectively #8he News& @//%"

5oing by the instance given above& the researcher is of the opinion

that there must have been an act of sabotage by those at the helm of

affairs including state chief e,ecutives of most states in the country" Aclear case is the former !inister of Power and Steel& !r ?yel Imo-e"

9lotu #@//% rightly points out that collaboration and sabotage is so

effective so much so that:

' with ;bsanjo and (moke in control, the

National (ntegrated Power Project contracts were

handed over to their friends and associates likecandies at childrens party. ;ver 6 contracts

were approved, while 6


49/106

contractors, work has not commenced on most of

the project sites. >ontractors and supposed

supervisors of different projects openlycontradicted each other on the e8istence of certain

projects, the contract sum and the e8tent of work

*+/5:0.

8he episode as captured above is in e,haustive in the e,planation of

the level of bac-wardness& underdevelopment& misery& poverty and

degradation in which the entire Nigerian state has been plunged into"

8here is no gain saying that these ugly practices has the potential of

disrupting the plans& policy targets& aspirations& contents and flavour

of NigerianFs dreams towards a highly industrialized political entity"

8here is no doubt that in the midst of epileptic power supply" !a;or

infant industries will suffer& hospitals will close down and the

euipment -ept fallow for lac- of power supplyH Nigerian youths will

further romans with crime and social vices for lac- of employment

opportunity where there no companies to absurb the wor- forceH high

level of e,ploitation will reign supreme as imported mini power

generators are sold at e,orbitant rates by few importers from China

and


50/106

people without which it is impossible to want to present the on>going

affairs of the Nigerian state as democratic in line with group

aspirations #9basi& @//%"

&.11 C!ALLENGES OF POWER GENERATION AND NIGERIAS

SOCIOECONOMIC DEVELOPMENT

Jandalisation of P$CN euipment and installations for re>circulation

accounts for at least 1/L of blac-out e,perienced in Nigeria today"

P$CN has embar-ed on a massive campaign against the activities of

vandals who perpetrate this heinous acts and cash rewards to thosewho watch over P$CN installations to apprehend suspects for

possible prosecution in the law courts" Also eight >wheel Isuzu patrol

vehicles fitted with communication euipment has been given to the

Police Anti Jandalism 8as->4orce" A cash cheue of N" million

was also presented to the Inspector 5eneral of Police for paying

allowances and honorarium to members of the tas->force" 8he poor

state of our electrical generating plants across the country& the long

decline in capital investment in the industry and the shortage of funds

to rehabilitate bro-en>down plants to underta-e turn around

maintenance& is the paramount spectre of vandalisation #8anweer&

0EEEH 'sman @//1& Kubairu& @//@%"

$ardly any day& wee- or month passes without the ugly face of

vandalism being visited on the nationFs already embattled electricity

networ-" !edia reports on this are as frightening" 8his menace is

another dilemma in the legion of problems and constraints facing the

Power $olding Company of Nigeria #P$CN% vested the with mandate

0


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to generate& transmit and distribute electricity in the country" 8he

wanton destruction this is infliction on the entire networ- system aside

the untold drain on scarce financial resources is better imagined" It is a

nightmare to say the least" +normous resources have been lost to the

callous acts of vandalism which have since become a social problem

in the country" Several areas and communities have suffered contrived

power failures in the wa-e of vandalisation of P$CN euipment"

8he seuences of such heinous crimes are devastating indeed" In

addition to the huge economic loss the country suffers& while the

damage in terms of both material and human resources is

unuantifiable"

$owever& vandalism is the product of a comple, society such as ours"

8he craze for material things and the desperate desire to get rich uic-

in a bid to win the material rat race push people to commit all sorts of

offences including vandalisation" 7ell meaning Nigerians and the

press have at various times spo-en out on this ugly phenomenon that

is not only peculiar to P$CN but also to other vital public utilities"

et& it is as bad that this is evading meaningful solution" Sadly& vital

components of the NationFs electricity industry continue to be

vandalized and stolen by hoodlums and their faceless sponsors

#7i-ipedia& @//%"

8he ugly phenomenon has no doubt compounded our development

problems as the nation continues to witness retarded growth through

mindless pillage in the hands of the culprits" !ost of the items so

@


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carted away reuire huge but scarce foreign e,change to procure"

Conseuently& the helpless electricity consumers are left to suffer

prolonged period of dar-ness until the authority manages to come to

the rescue at a much greater cost #N+PA *eview September& @//1:3&

$artman& 0E3%"

As an important inde, for socio>economic development and growth&

electricity occupies a central place in modern societies and economies"

+verything must therefore be done to ensure that the system is

safeguarded against willful damage" 8he current war against

vandalisation which the federal government in its wisdom is involved&

is appropriate in order to influence a change of attitude in our society"

7e commend the uic- response and patriotic commitment of the

president to route the vandals" 8his position raises hopes that with the

co>operation and support of all well meaning Nigerians& the nation

will soon reap the benefits& which will translate into significant

reliability in power supply #NCP& @//1%"

Nigeria certainly has a choice to deal with vandalisation and theft of

euipment since much of the nationFs growth will depend on the

sustainance of the electricity industry& the bac-bone of any nationFs

economy and industrial leap forward #NCP& @//1%" ?et us consider a

profile of vandalisation power installation in Nigeria in recent times

viz:

1


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S)77-(8 9 79; (,#,*; -#; 9 V-*-Alad;a

11/(J line

8owers 3 collapsed due to fire

from pipeline vandalisation

0/&@E2&1//"//

1 Delta ) 6enin 8owers 3 collapsed due to fire

from pipeline vandalisation

+stimated cost

&///&///"//

1/ #8ower @E

collapsed and @ damaged%

+stimated cost

0&///&///"//S9)(#,: N+PA *eview Sept" @//1""

9bviously however& some of the ma;or challenges in the generation

and distribution of power supply in Nigeria are enumerated as

follows:


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rehabilitation& replacement and e,pansions of the AuthorityFs

euipment and services"

" Aging euipment: About 01"EL of P$CNFs installed capacity are over

@/ yearsH or 3"0L over 0 years or 3E"2L are over 0/ years old"

8hese are impediments to P$CN outputs" 8he 5overnment has ta-en

giant steps by funding the rehabilitation and servicing of generating

stations across the country" 8he recent participation of the

Independent Power Producers #IPP% in the electricity industry would

also boost electricity in Nigeria"2" 7ater level: Nigeria has the hydro power generating stations in (an;i

Dam& commissioned in 0E2&


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was caused by low 5as pressure to the +gbin power station #Kubairu&

@//@%" 5as supply to the power station was cut>off when the bye>pass

valve of the gas pipeline failed to open up& thus leading to a cascading

effect on the system& shutting down all the power generation" 8his is a

ma;or setbac- to socio>economic development in Nigeria"

8he Authority is wor-ing tirelessly to ensure that it achieves the

5overnment target of electricity for all" 8o ensure this& P$CN will

need to add about 0/ megawatts to the National 5rid" 8headditional megawatts would be made out of the e,isting eight power

stations in the country"

8he Asea 6rown 6overi ?imited #A66% a foreign firm currently

participating in the on>going rural electrification of the Abu;a

Independent Power Pro;ect #IPP% would in;ect / megawatts of

electricity into the system" Some of the pro;ects the company had

e,ecuted in Nigeria include the 9sogbo Ife.Illesha 01@(J

transmission& @O1/./[email protected](J Ilesha substations amongst a

host of others #Sigmund& 0EE/%"

8he 4ederal 5overnment has chosen firms for the first phase of the

schedule 1/ megawatts& +PP plant for Abu;a" 8he power pro;ect is

being handled by Aggre-o International Power Pro;ect #AIPP% Plc and

5eometric Nigeria ?imited" 8he pro;ect is split between the two firms


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so that it could stand the test of time" !ore ways of finding solution to

the power generation& distribution and transmission is however still

being e,plored #9;o& 0EE%"

7ith impending conditions li-e the ever>rising consumer debts&

vandalisation of P$CNFs installation& high cost of maintenance&

inadeuate gas supply& low water level at the hydro power stations&

high cost of foreign e,change the abysmally low tariff regime& P$CN

has always strived to meet its distribution and mar-eting of stableelectricity to its numerous residential& commercial and industrial

customers against all odds" I

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