10/16/14, "Un-Cooking Africa's Books," National Geographic, Pooja Bhatia. "Accounting issues plague countries like Nigeria."
"In April, Nigeria revised its books. Overnight, GDP nearly doubled, and Nigeria shot past South Africa to become the continent's largest economy.
This wasn't gimmickry or dodgy accounting. According to
Nigerian officials, it was a correction—one that's likely to be repeated
in developing countries around the world. Just last month, Kenya recalculated its GDP upward, to the tune of 25 percent.
The
episodes highlight what those in the development world have known for
decades and mostly ignored: Africa has a data problem. A big
data problem. Official GDP figures for most African countries, even
relative powerhouses like Angola, are dramatically understated—literally
off base, for they're measured against baselines so old they're
obsolete. Nigeria was calculating its income against a baseline set in
1990, which meant it undervalued fast-growing sectors like telecom and
movies.
Developing countries aren't alone in their
accounting woes—even wealthy economies must revise their GDP
calculations—but theirs are likely the worst. World Bank data indicate African countries have the weakest statistical capacity in world. And
the stakes of "Africa's statistical tragedy" are quite serious. We don't
really know continental vaccination rates, or how many kids go to
school in, say, Rwanda. Most important, we don't know whether the
approximately $150 billion spent annually in development aid is actually
helping.
These stakes will shift as aid-dependent
countries transition to emerging markets, experts say. Against lowballed
GDP figures, key investor metrics like national growth tend to be
overstated. To compensate for higher risk, businesses in developing
markets must offer higher premiums. Expect a good deal of confusion and
inefficiency as Ghana, Nigeria and Kenya enter capital markets. (See: US and China fight for Africa)
"Data
in Africa is becoming more and more important, and it's likely to
become more contested," says Morten Jerven, an economic historian and
author of Poor Numbers: How We Are Misled by African Development Statistics and What to Do About It (2013).
The book argues that Africa's income and growth accounting is awful,
few admit it's awful, and that most economic decisions regarding
Africa—aid or investment—are ill- or misinformed. "More than half the
rankings of African economies up to 2009 may be pure guesswork," Jerven
wrote.
Mostly, this is a problem of capacity, not
intention. Demand for Africa's data is surging, and the continent's
national statistics offices—some of them musty one-man affairs with
marginal electricity—haven't kept up. A July report from the Data for
African Development Working Group found that most national statistics
offices in Africa lack reliable funding and, in fact, depend on aid
donors for their budgets. The aid donors are generally happy to fund
their statistical priorities, like household surveys, but not so keen on
national statistic "building blocks" like births and deaths, growth and
poverty, and taxes and trade. Governments aren't stepping in. Still you
can't insulate data from politics, the report argues. "To the extent
that data is used to hold people accountable, it will be misreported,"
says Amanda Glassman, an author of the report and a researcher at the
Center for Global Development, a think tank in Washington, D.C. Another
study she co-authored this summer found that across Africa, when school
administrators are paid by the pupil, they report higher enrollment
rates. Surprise, surprise.
There are even rational
reasons to lowball GDP, Jerven argues. The poorer you seem to be, the
easier it is to score concessional loans from the likes of the IMF. And a
low GDP can make governance look a lot better than it is: Donors are in
the habit of using tax collections to GDP as an indicator of the
state's health, and the lower the GDP looks, the better the ratio does.
"How
on earth could it even pass that it took a quarter of a century for
Nigeria to update its statistics? That was because nobody cared about
the numbers. And if they did care, it made sense to look poor," says
Jerven.
With the United Nations calling for a worldwide
"data revolution," plenty of geeks are lighting up at the prospect of
solving Africa's data woes. But technology alone won't fix it. There's
not enough valid data to mine, for starters, and for all the hullabaloo
around gadgetry, "we're not going to solve these problems by collecting
satellite information," says Glassman, referring to the trend of using
satellite data on light intensity to predict GDP. "New technology can
make the system more efficient, but it doesn't overcome the perversions
of misreporting." What's needed, she says, is the "kind of routine
administration and data collection we take for granted."
And
then there's the coming tide of investors, lured by Africa Rising. More
and more, says Jerven, countries don't want to look poor. They want
investment, and they want to be able to offer investors lower risk and
lower returns. These days, says Jerven, when Ethiopia's rulers want a
new dam, they don't beg the World Bank for project finance. They float a
bond and go to big commercial banks instead. That opens up an
interesting possibility: Private investment could introduce rigor and
resources into statistics infrastructure.
When Jerven's
book was published in February 2013, before Nigeria's rebasing, Jerven
hoped it might gain notice at think tanks and universities. But the
first query he got about his book came from the private sector: Standard
Chartered Bank. "They wanted to know just one thing: What is the GDP of
Nigeria?""
=====================
More on Nigeria:
Nigeria's oil theft racket involves everyone: "crooked politicians, security forces, oil industry personnel and oil traders....Officials and private actors disguise theft through manipulation of meters and shipping documents....Proceeds are laundered through banks and businesses in African states, as well as the U.S., Britain, Switzerland, India, Singapore and the Persian Gulf."...
10/18/13, "Nigeria's booming oil theft racket costs $1B a month," upi.org, Port Harcourt, Nigeria
"Royal Dutch Shell is selling off four of its onshore Nigerian oil blocks because of the constant theft of large volumes oil from its pipelines, officials said. The move highlights the West African state's growing battle with criminal syndicates that are stealing an average of 100,000 barrels of crude a day. That costs the continent's second largest economy after South Africa up to $1 billion a month, a criminal enterprise on an industrial scale that officials say rivals the narcotics trade as the world's most lucrative crime.
========================
Half of Nigeria's oil revenue has disappeared via theft and corruption:
April 2009, "Has globalization failed in Nigeria?" Yale.edu, Michael Watts
"Since 1960, over $600 billion in oil revenues has flowed into Nigeria’s coffers; it represents an opportunity unavailable to much of the developing world. These petrodollars could have been spent productively, could have transformed agriculture, laid the foundation for an effective public education system, provided much-needed infrastructure. Yet, according to the World Bank, of that $600 billion, $300 billion has simply disappeared into overseas bank accounts through theft and corruption."...
.
===============================
"Public office is so lucrative that people will kill to get it. Nigeria has 36 state governors, 31 of whom are under federal investigation for corruption."
.
8/8/2013, "A country so corrupt it would be better to burn our aid money," UK Daily Mail, Michael Burleigh
"Nigeria is not quite the most corrupt country on earth. But according to Transparency International, which monitors international financial corruption, it is not far off — coming a shameful 172nd worst among the 215 nations surveyed. Only countries as dysfunctional, derelict and downright dangerous as Haiti or the Congo are more corrupt.
In theory, Nigeria’s 170 million-strong population should be prospering in a country that in recent years has launched four satellites into space and now has a burgeoning space programme.
Moreover, Nigeria is sitting on crude oil reserves estimated at 35 billion barrels (enough to fuel the entire world for more than a year), not to mention 100 trillion cubic feet of natural gas.
It also manages to pay its legislators the highest salaries in the world, with a basic wage of £122,000, nearly double what British MPs earn and many hundreds of times that of the country’s ordinary citizens.
No wonder the ruling elite can afford luxury homes in London or Paris, and top-end cars that, across West Africa, have led to the sobriquet ‘Wabenzi’, or people of the Mercedes-Benz.
Yet 70 per cent of Nigerians live below the poverty line of £1.29 a day, struggling with a failing infrastructure and chronic fuel shortages because of a lack of petrol refining capacity, even though their country produces more crude oil than Texas.
And that poverty is not for want of assistance from the wider world.
Since gaining its independence in 1960, Nigeria has received $400 billion (£257 billion) in aid — six times what the U.S. pumped into reconstructing the whole of Western Europe after World War II.
Nigeria suffers from what economists call the ‘resource curse’ — the paradox that developing countries with an abundance of natural reserves tend to enjoy worse economic growth than countries without minerals and fuels.
The huge flow of oil wealth means the government does not rely on taxpayers for its income, so does not have to answer to the people — a situation that fosters rampant corruption and economic sclerosis because there is no investment in infrastructure as the country’s leaders cream off its wealth.
.
Given the appalling levels of corruption in that nation, this largesse is utterly sickening — for the money will only be recycled into bank accounts in the Channel Islands or Switzerland.
Frankly, we might as well flush our cash away or burn it for all the good it’s doing for ordinary Nigerians."
=================================
=====================
More on Nigeria:
Nigeria's oil theft racket involves everyone: "crooked politicians, security forces, oil industry personnel and oil traders....Officials and private actors disguise theft through manipulation of meters and shipping documents....Proceeds are laundered through banks and businesses in African states, as well as the U.S., Britain, Switzerland, India, Singapore and the Persian Gulf."...
10/18/13, "Nigeria's booming oil theft racket costs $1B a month," upi.org, Port Harcourt, Nigeria
"Royal Dutch Shell is selling off four of its onshore Nigerian oil blocks because of the constant theft of large volumes oil from its pipelines, officials said. The move highlights the West African state's growing battle with criminal syndicates that are stealing an average of 100,000 barrels of crude a day. That costs the continent's second largest economy after South Africa up to $1 billion a month, a criminal enterprise on an industrial scale that officials say rivals the narcotics trade as the world's most lucrative crime.
========================
Half of Nigeria's oil revenue has disappeared via theft and corruption:
April 2009, "Has globalization failed in Nigeria?" Yale.edu, Michael Watts
"Since 1960, over $600 billion in oil revenues has flowed into Nigeria’s coffers; it represents an opportunity unavailable to much of the developing world. These petrodollars could have been spent productively, could have transformed agriculture, laid the foundation for an effective public education system, provided much-needed infrastructure. Yet, according to the World Bank, of that $600 billion, $300 billion has simply disappeared into overseas bank accounts through theft and corruption."...
.
===============================
"Public office is so lucrative that people will kill to get it. Nigeria has 36 state governors, 31 of whom are under federal investigation for corruption."
.
8/8/2013, "A country so corrupt it would be better to burn our aid money," UK Daily Mail, Michael Burleigh
"Nigeria is not quite the most corrupt country on earth. But according to Transparency International, which monitors international financial corruption, it is not far off — coming a shameful 172nd worst among the 215 nations surveyed. Only countries as dysfunctional, derelict and downright dangerous as Haiti or the Congo are more corrupt.
In theory, Nigeria’s 170 million-strong population should be prospering in a country that in recent years has launched four satellites into space and now has a burgeoning space programme.
Moreover, Nigeria is sitting on crude oil reserves estimated at 35 billion barrels (enough to fuel the entire world for more than a year), not to mention 100 trillion cubic feet of natural gas.
It also manages to pay its legislators the highest salaries in the world, with a basic wage of £122,000, nearly double what British MPs earn and many hundreds of times that of the country’s ordinary citizens.
No wonder the ruling elite can afford luxury homes in London or Paris, and top-end cars that, across West Africa, have led to the sobriquet ‘Wabenzi’, or people of the Mercedes-Benz.
Yet 70 per cent of Nigerians live below the poverty line of £1.29 a day, struggling with a failing infrastructure and chronic fuel shortages because of a lack of petrol refining capacity, even though their country produces more crude oil than Texas.
And that poverty is not for want of assistance from the wider world.
Since gaining its independence in 1960, Nigeria has received $400 billion (£257 billion) in aid — six times what the U.S. pumped into reconstructing the whole of Western Europe after World War II.
Nigeria suffers from what economists call the ‘resource curse’ — the paradox that developing countries with an abundance of natural reserves tend to enjoy worse economic growth than countries without minerals and fuels.
The huge flow of oil wealth means the government does not rely on taxpayers for its income, so does not have to answer to the people — a situation that fosters rampant corruption and economic sclerosis because there is no investment in infrastructure as the country’s leaders cream off its wealth.
.
Given the appalling levels of corruption in that nation, this largesse is utterly sickening — for the money will only be recycled into bank accounts in the Channel Islands or Switzerland.
Frankly, we might as well flush our cash away or burn it for all the good it’s doing for ordinary Nigerians."
=================================
7/5/12, "Mongolia’s task: avoid Nigerian resource curse," Reuters, Martin Hutchinson
"Current estimates are that more than $1 billion of oil per month is stolen from the Niger Delta fields and corruption remains endemic even under well-meaning President Goodluck Jonathan. Nigeria ranks 133rd on the World Bank’s Ease of Doing Business Index and 143rd on Transparency International’s Corruption Perceptions Index. True, high oil prices reversed 40 years of decline in living standards through 2000. And while GDP growth is slowing, it’s still expected to run at 6 percent to 7 percent this year. But with inflation in double digits and government expenditure budgeted to exceed revenue by 31 percent in 2012, Nigeria’s situation is unstable."
================================
Bush admin. Nigerian ambassador (2004-2007) defends Hillary Clinton re: Boko Haram, says Bush admin. didn't think Boko Haram was terror group either:
5/12/14, "Boko Haram Designation: John Campbell Flays Criticism Against Hillary Clinton," Leadership News (Nigeria), Abiodun Oluwarotimi
.
"Former U.S. Ambassador to Nigeria, Mr. John Campbell, yesterday said that it was unfair to criticize former Secretary of State Hillary Clinton for not designating Boko Haram a terrorist group organization.
John Campbell, a notable critic of President Goodluck Jonathan’s administration, had served as the U.S. Ambassador to Nigeria from 2004 to 2007 under President George W. Bush.
While reacting to criticisms against Hillary Clinton for not naming the entire terrorist group a foreign terrorist organization, Campbell said he and other experts on Nigeria had also opposed the designation because Boko Haram was a “highly diffuse” group and the move could have limited U.S. options in dealing with it in the future.
The State Department has since designated Boko Haram as a terror group, and President Barack Obama has dispatched military advisers and law enforcement personnel to help in the search for the girls after Nigeria initially balked at asking for assistance.
But Campbell said that as the most populous country in Africa, Nigeria is often reluctant to ask for international assistance but that it must do so before the U.S. can step up its aid.
“For the U.S. to do anything, it requires the request and acquiescence of the Nigerian government. Nigerians look to help, not be helped, so this is a different set of circumstances for them,” he said.
The former US envoy to Nigeria said Boko Haram, which has threatened to sell the girls into slavery, noted that the sect wanted to destroy the Nigerian government because it was secular, stressing that it was likely that the captives had been split up and taken to different countries in Africa.
“It’s unlikely that all of them could be rescued,” he noted."
.
No comments:
Post a Comment