PRESS RELEASE: 

Thursday 29 August 2002

Contact in Johannesburg: 
Ann Pettifor 082 858 1116 (cell)
Sasha Blackmore 072 495 2512 (cell)

Contact in London: 
Romilly Greenhill +44 7812 605 131 (cell)
+44 207 089 2878

Jubilee Research at NEF welcomes Nigeria's decision to prioritise her people over foreign creditors

Jubilee Research, official successor to the UK Jubilee 2000 campaign today welcomed Nigeria's decision to defer some debt service payments, and hence prioritise the needs of her people over the interests of her foreign creditors. 

Ann Pettifor, co-founder of Jubilee 2000 and Director of Jubilee Research at NEF said 
"The decision by the Nigerian government to limit debt repayments and prioritise her people over foreign creditors is welcome. We call upon the international community, gathered in Joburg to prioritise sustainable development, to support Nigeria in this very difficult decision.

"Co-responsibility for Nigeria's debts rests with those bankers and governments that lent recklessly in the past to corrupt Nigerian regimes. Much of Nigeria's debt is a legacy of delinquent lending by international creditors, and corruption by former military dictators. Today the people of Nigeria are being forced to pay the price of the secretive and irresponsible actions of international bankers and past military dictators.

"Half of the stock of Nigeria's debt consists of added compound interest on debts that were unpaid by military leaders. Now that Nigeria has a democracy, creditors, like vultures, are moving in on her elected government and impoverished people. 
"This WSSD conference should stand by President Obasanjo and the people of Nigeria and ensure that the money diverted from debt service payments goes into health, education and other vital services for the Nigerian people."

Note to journalists:
1. Nigeria is Africa biggest debtor and owes US$34 billion to its external creditors, according to the Debt Management Office (DMO), set up by the Nigerian government. The IMF puts the stock of debt at US$31.9 billion. Her debt service payments due this year, amount to $3bn per annum.

2. Nigeria, because of her low human development indicators, and substantial debt burden, was initiatlly (in 1996) defined by the World Bank and IMF as eligible for debt cancellation under the HIPC initiative. She was subsequently removed from the list, for reasons that remain unclear. Nigeria has a lower average income, and a higher debt to GDP ratio than many of the countries that are receiving relief. 

3. Nigeria's GDP per capita is US$853 per capita compared to US$22,093 for the UK, US$26,251 for Canada , and US$24,575 for Australia. 

4. Maternal mortality in Nigeria is amongst the highest in the world, with 700 women dying out of every 100,000. 10% of infants die at birth.

5. Nigeria ranks 151st out of 174 countries in the HDI poverty index but its creditors are still demanding 15 times in debt service what it is able to spend on poverty reduction. For Nigeria to meet Millenium Development Goals set by the United Nations for the year 2015, it needs to spend about US$11 billion per year on social services - well above present levels and nearly double what Jubilee Research considers to be reasonable given the taxing capacity of its poor population.

6. While Nigeria's oil revenues have provided welcome relief to the country's hard-pressed finances, they cannot be said to enrich Africa's most populous nation. Revenues net of production costs and foreign company earnings are approximately US$11 billion per annum, which for a population in excess of 111 million equates to net revenues of only US$100 per person, per annum or 27 cents a day. 

7. Nigeria's democratic government is carrying US$14 million of debt racked up by previous dictatorships and large amounts of Nigerian reserves are deposited in foreign banks as a result of capital flight. General Abacha alone stole and deposited US$4 billion in Western banks - in London, Washington, Frankfurt and Zurich. 

7. Oil companies such as Shell, Mobile, Texaco and Chevron owe huge ecological debts to Nigeria as a result of the degradation of the Niger Delta, the main oil producing area. Nigeria's largest oil spill was an offshore well blowout in January 1980 when an estimated 200,000 barrels of oil (8.4 million) spewed into the Atlantic Ocean from a Texaco facility and destroyed 340 hectares of mangrove. Nigeria flares more gas than any other country in the world - about 75% of its total gas production, contributing a high percentage of the world's total emissions of greenhouse gases.