New President of Nigeria sweeps to victory and inherits a debt of $30 billion.

General Olusegun Obasanjo has swept to victory in Nigeria, inheriting a debt of over $30 billion. In a controversial election, Obasanjo won 60% of the votes in a run-off with Chief Olu Falae. Obasanjo is expected to be sworn in as President within the next 3 months. However it remains unclear from his statements how he intends to deal with Nigeria's economic and social problems and in particular the overwhelming national debt.

Obasanjo won the contest against Chief Olu Falae amid many reports of irregularities in the voting process. However despite allegations of ballot-rigging and bribery, commentators generally accepted that the vote matched the balance of support for the two presidential candidates. Chief Olu Falae was the Finance Minister in the late 1980s. Some commentators have suggested that his role in enforcing very unpopular structural adjustment measures in the late1980s contributed towards his defeat.

Debt may have featured in indirect way in the election. Both Falae and Obasanjo have pledged that there will be no investigation of the embezzlement of the country's oil income by the army's top brass. However Obasanjo will soon be forced to confront his inheritance of debt. Debt dominates the economic and social landscape. The national debt of Nigeria is $31,407, 000 which amounts to 14% of Africa's debt. In 1996, Nigeria's debt service was $2.5 billion most of which went to its commercial creditors rather than governments who had imposed sanctions on Nigeria. Recently she has been unable to keep up with debt repayments with over half of scheduled payments going into arrears. This situation is likely to get worse as oil price has recently collapsed – it is the source of 80% of the country's hard currency and is currently at the lowest price for 12 years. The result has been pitiful expenditure on health and education. 8% of GNP is spent on debt service compared to 1.3% on education and 1.2% on health.

The debt crisis was largely built under the military regimes that have cursed Nigeria. $13.6 billion debt or 43% of the debt was built up during the regimes of Buharia and Abacha. A large proportion of the debt - roughly £3 billion - is owed to British government and was lent to Nigeria almost entirely during the era of military dictatorship. In terms of international law they would be classified as odious debts and cannot be the responsibility of those who did not take them on and who suffered as a result of those loans. It also raises the issue of “moral hazard.” This concept traditionally was used to argue against debt cancellation on the basis that cancelling debts would threaten future loans. Economists are increasingly using the term to highlight the bailout of private lenders with public money. In Nigeria's context, it can be argued that by forcing repayment of these loans, we are saying it is acceptable to lend to corrupt and oppressive dictators. The question remains whether the British Government will accept responsibility for bad loans to the Nigerian military regime.

The Nigerian Government has started to address the issue of debt. Ismaila Usman, Nigeria's finance minister, called on Britain on the 25^th February to back “substantial and highly concessional debt relief”. This was promised by Brian Wilson, British Trade minister, dependent on further reform “especially on transparency and corruption”

These are beginnings. However, tackling the debt will probably come strongest from the grassroots. Democracy activists have been at the forefront of the growing Jubilee 2000 Coalition in Nigeria. During the elections, one of the most powerful voices came not from an official party but from Femi, son of Fela Kuti and founder of Afrobeat. He has been reviving his father's songs denouncing corruption and speaking out on behalf of the poor. His new movement anticipates many of the arguments of Jubilee 2000 Campaigns. Called the Movement Against Second Slavery, his songs constantly challenge the abuse of power by elites supported by Western Governments and companies

“We were enslaved physically before. Then they took the chains off and found another way of enslaving us which was to enslave our minds. Steal the money if you want. When you die don't forget to take it with you. Just give us the simple amenities of life. Good schools. Health. Light. Water. Food. Why can't any government provide that?”