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Friday, 28 December, 2001, 15:53 GMT
Nigeria's oil wealth shuns the needy
The Delta may be rich in oil but the people are poor
Oil rich Delta has some of the poorest people in Nigeria
By the BBC's James Whittington in Nigeria

The way oil wealth is managed in Nigeria is one of the key issues facing those living there.

The government and oil companies have profited by hundreds of billions of dollars since oil was first discovered.

Yet most Nigerians living in the oil producing regions are living in dire poverty.

The oil region in Nigeria seems to be stuck in a time warp, with little real change since oil was discovered 45 years ago.

Away from the main towns there is no real development, no roads, no electricity, no running water and no telephones.

Most people are struggling to survive on less than $1 a day.

People who live in the Niger Delta blame the oil companies for this shocking state of neglect, particularly Shell Petroleum Development Company, which produces most of the country's oil.

The heart of Shell's operations is Port Harcourt, a small coastal town which actually smells of oil.

Donald Boham, Shell's external relations manager, explained why the delta region has been ignored for so long;

"We've had a good number of years of military rule in this country, where the government - for one reason or another - failed to address the need for development in the Niger Delta and that has put a lot of pressure on the oil companies to try and fill the gap that the government has created.

"Last year for example, we spent $60m on community development intervention activities, which represented about 3% of the entire joint venture budget."

Helping themselves

But how is this money being spent?

On a small farm in the Niger Delta, a local farmer chose to participate in one of Shell's community projects.

"I decided to join this because first of all I am a farmer and thought that by joining this farm I may be able to help my people come here, learn, then go home to establish on their own," he said.

"There will be improvement for sure, if knowing fully well that they are tenants doing what the landlord asks them to do so creating a very good relationship."

Unlike the rest of Nigeria, Abuja - the federal capital - looks like a modern African city.

Because money has been spent on infrastructure most facilities, from phones to electricity, seem to work.

Change of policy

Mark Tomlinson, the World Bank's director for Nigeria, believes the government must share some of the blame for ignoring the oil producing regions.

"I don't think the oil companies by themselves should be saddled with the development of the delta," Mr Tomlinson said.

Delta village
Delta residents want more infrastructure

"It is an absolutely huge undertaking and much of the tension we can trace back to the state government's not assisting at all with the provision of basic infrastructure services that these villages require to grow.

"I've travelled in the delta a number of times recently and each community we visited we asked the question, 'what has the state government done for your village in terms of providing basic services?'.

"In half the cases they just laughed, and the other half said nothing had been done at all."

All the country's oil revenues are collected by the federal government.

In the past much of it was stolen by corrupt officials and military leaders but the method of distributing oil revenues has recently changed and state governments have greater say in how the money is spent.

Vote of confidence

David Edverby is the commissioner of finance for Delta State.

"We have only recently received the largest amount of revenue from the federation account," he said.

"We cannot forget that approximately 40% of the revenue that comes in goes into payment of salaries and overheads.

"The remaining 60% we spend on capital projects and a huge amount of capital expenditure has happened over the last 18 months.

"We have to go back to the electorate every four years. Clearly if they are not happy with the way their money has been spent they will just not re-elect you."

"We really have no choice but to ensure that money gets spent on the people."

For the people living at the birth site of Nigeria's oil industry all the talk about the change in approach to economic developments is simply academic.

For them, like most Nigerians, oil is seen as a curse rather than as a blessing.

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"Most people are struggling to survive on less than $1 a day"

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27 Aug 01 | Africa
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