Saturday, 13 November 2010

Article: South Africa’s Elite Join in the Plunder of Nigeria

Participants At The Event
(Paper presented at the 15th Anniversary of the killing of Ken Saro-Wiwa & 8 others in Cape Town, South Africa)

By Shawn Hattign

Nigeria’s recent history has been marked by plunder. Corporations like Shell and Chevron, with the backing of powerful states like the US, Britain and France, have dominated the country, exploited its people and destroyed its environment. Linked to this, the US state through the IMF has kept Nigeria’s people in an almost complete state of serfdom by extracting vast amounts of money from them through debt repayments. The plunder of the country has at times even seen corporations, such as Shell, working hand in hand with the Nigerian military to put down any resistance to their operations in the country, which has included working together to murder Ken Saro-Wiwa.

A small section of the Nigerian society - in the form of politicians, leading state officials, generals and powerful business people - have also been involved in this plunder. They have formed partnerships with imperial powers and corporations from the US and Britain because they have benefited from doing so. In fact, over the years state officials in Nigeria have whisked away billions of dollars, obtained from the oil industry and bribes from corporations, and have stashed these funds in various tax havens. As part of this the Nigerian elite, along with dominating society, have also played workers and the poor off against one another to keep people divided and weak. This has been done by exploiting ethnic and religious differences, so that people turn against one another rather than the real enemies - imperialist powers, corporations and the local elite. In fact, the situation in Nigeria highlights how the state and capitalist system are inherently violent, exploitative and oppressive. Indeed, the result of the plunder of Nigeria, by imperial powers like the US and local Nigerian elites, has been devastating: in real terms Nigerian workers and the poor are probably poorer than at any time in their history.

Over the last fifteen years, another power has joined this plunder. This power is South Africa. Despite being junior partner to the US and the British states, the South African state acts as an imperialist power in its own right in Africa, including in Nigeria. In Africa, the South African state and corporations often work together to seek out new markets, resources and cheap labour. As such, the South African state’s foreign policy towards Africa, including Nigeria, is not based on Pan-Africanism or anti-imperialism; but rather on self interest. In the case of Nigeria, this has seen the South African state promoting the interests of South African linked companies, through things such as a bilateral trade and investment agreement and an investment council. It has also seen them linking up with the Nigerian elite by forming strategic partnerships. To some extent this has proved successful as the South Africa state and corporations have become notable investors in Nigeria.

South African interests in Nigeria have grown:
The success that the South African state has had in opening Nigeria up for its corporations can be seen in expansion of the number of South African linked companies operating in the country. In 1999 there were only 4 South African linked companies operating in Nigeria; today there are reportedly over 100.

South African companies have become major players in a number of sectors of the Nigerian economy. For example, in 2001 MTN entered into Nigeria and it now has over 10 million subscribers. In the Nigerian retail sector, South African companies also loom large. Massmart and Shoprite have opened a number of stores in the country. South African companies also control a large portion of the international fast food franchising industry; while Sanlam and Standard Bank have become involved in the financial sector. With the economic crisis, a number of Nigerian banks were bailed out by the state and these are now up for sale. South African linked banks, in the form of Standard and First National, are trying to buy these banks to expand their interests. South African state-owned companies are also expanding into the country, for instance Eskom has a number of interests in Nigeria.

South African companies have also received oil concessions from the Nigerian state. Ophir Energy, partly owned Mvelephanda Resources, has been given the right to mine oil in the country. In 2010 another South African company SACoil formed a partnership with the Nigerian company, Energy Equity Resources, and bought oil interests in the Niger Delta. Similarly, SASOL entered into a partnership with Chevron to develop a gas to fuel plant. This project is expected to be up and running by 2013; after a number of delays and running over budget, and will eventually produce 120 000 barrels a day.

Oil scandals:
In 1999 the Nigerian state also awarded the South African state the right to market 50 000 barrels of oil a day. In 2003, Thabo Mbeki and Alec Erwin intervened and got it increased to 120 000 barrels of oil a day. However, the South African state passed on the rights to this oil to a shadowy company, the South African Oil Company, which is registered in the Cayman Islands. It appears that 70% of the South African Oil Company was owned by a Nigerian-American businessman, Jakes Lawal, but who owned the other 30% is a mystery. Lawal, however, has close connections with leading past and present ANC figures. It is interesting that the Cayman Island’s South African Oil Company also had a sister company registered in South Africa. It was perhaps no co-incidence that some of the shareholders in this sister company happened to be leading ANC figures, like:
• Nomusa Mufamadi, wife of Sydney Mufamadi
• Miles Nzama, leading figure in the ANC Fundraising Trust
• and Brian Casey, a confidant of Penuell Maduna.

Not all smooth sailing:
Although many South African companies have made huge profits in Nigeria, others have failed. For example, PetroSA bought a share in a Nigerian oil field in 2004, which it recently sold as the field produced less than was expected. Likewise, Telkom eventually spent approximately US $ 400 million on buying a Nigerian company – MultiLinks – which it is now trying to sell due to losses. Despite this, most South African linked companies have continued to make profits in Nigeria.

Trade between South Africa and Nigeria:
Along with an increase in South African investments in Nigeria, trade between the two countries has risen from $16 million in 1999 to $2.1-billion in 2008. Most of this trade involves South Africa importing oil from Nigeria. However, South Africa also exports manufactured goods to Nigeria. Amongst these has been military equipment worth R86 million. It was also recently announced that the South African state-owned arms company DENEL would, over the next few years, be producing parts for Augusta military helicopters that are to be exported to Nigeria.

Who benefits?:
Although still dwarfed by the interests of the EU and the US, the South African state and South African linked corporations have tended to do well out of their involvement in Nigeria. Despite all this trade, investment and profit, however, the workers and the poor of Nigeria have not benefited. This is because South African companies operating in Nigeria are allowed to repatriate much of the profits that they make out of the country. South African companies operating in Nigeria have also created surprisingly few jobs. The jobs that they have created have also tended to be casual. For example, many of MTN’s workers are temporary or on contracts, and it has reportedly tried to deny its workers the right to join a trade union.

Telkom in Nigeria also stands accused of casualising its workforce, paying workers extremely poorly, and firing workers when they demand their rights. Added to this, the company is accused or hiring expatriate South African managers instead of Nigerians. In fact many of the Nigerians who work for Telkom’s operations are employed as casuals. This led workers at Telkom’s operations, Multilinks, to go out on strike in October. South African companies have also been involved in blatant looting in Nigeria. MTN charges some of the highest rates in the world for cellular phone calls in the country. Added to this, SASOL is involved in partnerships with Chevron, which has committed human and environmental rights abuses in the Niger Delta.

Workers at Shoprite’s stores in Nigeria have also complained of appalling working conditions. Workers are forced to work long hours and receive poor pay; the average worker at Shoprite in Nigeria apparently earns as little as R592 a month (less than a weekly wages for domestic workers or nannies in South Africa). This situation led workers to recently embark on a strike. At one point, workers even occupied a store to try and get the management to improve their working conditions. Shoprite reacted by firing them and replacing them with more ‘compliant’ workers. Indeed, the struggle for better working conditions by workers in Shoprite, MTN and Telkom in Nigeria continues.

The plunder of Nigeria shows just how brutal capitalism, imperialism and the state systems are. While the Nigerian elite, the South Africa elite and the elite from other parts of the world have made billions from the plunder of Nigeria, workers have suffered and indeed paid the price. Although politicians and the rich in South Africa have benefited from exploiting Nigeria’s resources and workers; it must also be remembered that the South African working class have not. In reality, workers in Nigeria and South Africa often face the same enemy in terms of the bosses of companies like MTN, Telkom, and Shoprite etc. It is, therefore, important that workers and the poor in South Africa and Nigeria begin to form links with one another so that the struggle – like capitalism – becomes international.

Only through international struggle will exploitation in Nigeria, and South Africa, be ended. As such, it is vital not to fall in the trap of siding with the local bosses and politicians or embracing xenophobia or ethnic and religious hatred, as workers have much more in common with one another than they do with politicians and the bosses. Indeed, both Nigerian and South African workers and the poor face the same enemy in forms of the state and capitalist systems. For as long as these two systems exist, workers and the poor will never be truly free. As such, the struggles of workers and the poor in Nigeria and South Africa are part of same struggle – the struggle to be free from domination and exploitation - and it is important that we realize this, take interest in one another’s struggles and stand side by side. Indeed, freedom will only come when capitalism and the state systems are gone - along with other forms of oppression like racism and sexism - and replaced with a system where the poor and workers have control over their own lives without bosses, state officials and politicians ordering them about. Unlike the current oppressive state and capitalist systems, such a system based on freedom would have to centre around meeting people’s needs and not making profits, it would have to ensure direct democracy using decentralized and federated assemblies that people themselves direct, and to ensure worker’s freedom through self-management in workplaces. Only in such a world will everyone truly be free, including workers and the poor in South Africa and Nigeria.

(Shawn Hattign is a Researcher with the International Labour Research and Information Group (ILRIG), an active member of SAFOS and supporter of the Ogoni struggle.)