Project Description

CHAPTER ONE

Introduction

1.1       Background to the Study

United States foreign aid is aid given by the United States government to other countries. It can be divided into two broad categories: Military and economic assistance. It is given by the United States government and by private organizations and individuals in the United States (U.S Greenbook, 2014).

United States foreign aid is a fundamental component of the international affairs budget, for decades viewed by many as an essential instrument of United States foreign policy. Each year, it is the subject of extensive congressional debate over the size, composition, and purpose of the program. The focus of United States foreign aid policy has been transformed since the terrorist attacks of September 11, 2001 (http://www.whitehouse.gov/nsc/nss.html).

In 2002, a National Security Strategy for the first time established global development, a primary objective of United States foreign aid, as a third pillar of United States national security, along with defense and diplomacy. A 2010 policy document reiterated that notion, arguing that development is as central to advancing America’s interests as diplomacy and defense (www.usaid.gov/./03ts-nigeria/202)

For the first hundred years of the United States’ existence as a country, government aid was practically nonexistent. It was generally considered that the Constitution did not authorize the government to use the people’s money for foreign charity. There was, however, some private aid from charitable foundations and religious organizations. Missionary societies, for instance, operated schools in Africa and other areas, and provided some scholarships for foreign students to study in the United States. Later, the idea of government aid became more accepted. During World War One, the food was sent to the hungry in that war-torn country, received $387 million from the United States government (as well as $314 million from the British and French governments and about $200 million from non-governmental sources). These government monies were given in the form of loans, but a considerable portion of those loans were forgiven (http://www.state.gov/s/ct/rls/other/rpt/161418.html).

On the attainment of independence in 1960, Nigeria began to conduct its external relations with the rest of the world under the leadership of its Prime Minister, the Late (Sir) Abubakar Tafawa Balewa. The objectives and guiding principles of Nigeria’s foreign policy emphasized Africa as the centre-piece of the nation’s overall foreign relations (i.e. pre-occupation with Africa issues). It could be recalled that Nigeria had been previously under British sovereignty before independent. Saliu and Aremu (2006) observed that “at independence, the British influence and interest in Nigeria was overwhelmingly active as to allow for any clear role for the Americans. Since both United States and Britain were (still are) close allies, there was no strong desire to change the status quo. Hence, in the immediate post-independence Nigeria, United States came third after Britain and Germany in the areas of trade, aid and technical assistance.

Nigeria concentrated its fullest diplomatic attention on the United States and Britain, and cooperated rather intimately with the United States on major contemporary Africa issues. On November 17, 1960 a Nigerian, Dr. Jaja Wachukwu – Acting Permanent Representative for Nigeria at the United Nations was elected Chairman, United Nations Conciliation Commission on the Congo through the instrumentality of the United States and, on December 12, 1961 President John F. Kennedy of the United States announced an offer of $225 million as a long term development aid for Nigeria. Furthermore, the implementation of the American aid, within the framework of the First National Development Plan, marked the start of Nigeria’s strategy to multilaterize its external economic and political dependency in contrast with the traditional exclusive bilateral focus on the United Kingdom. As a result of this development, the United States emerged as the second most important metropolitan centre in Nigeria’s external economic relations.

Nigeria is a neo-colonial country, whose development to a great extent is manipulated external factors. Nigeria occupies a peripheral status in the global economic order. Nigeria is dependent on the external support of the western capitalist countries, for the promulgation and enforcement of programmes aimed at the development of her economy. Scholars such as Ake (1996); Offiong (1980, 2001) and Adeghite (2008) have considered the negative impact of the dependence status of the Nigerian economy on its development objectives. The dependence status of Nigeria has greatly influenced her quest to achieve economic growth. Nigeria relies on the advanced capitalist countries for basically, everything; starting from technology, finance, military, health, etc. This excessive reliance have greatly affected and deepened Nigeria’s ‘Dependence statuses in the global economic order.

Nigeria leaders and policy makers believe that Nigeria cannot do without external aid; so they keep borrowing funds for phantom and white elephant projects. Nigeria faces intense pressure to accept multi-billion dollar loans for railroads, power plants, roads and other infrastructure. These borrowings in turn increases Nigeria’s debt burden. Our leaders advocate foreign aid as a panacea for resuscitating our ailing economy. The point here is not only about the quest among Nigerian Leaders for foreign aid but more importantly on how such foreign aid engulfs Nigeria in a cobweb of conditionality. This conditionality consequently ensure that Nigeria economy remains open for the continued exploitation by the advanced capitalist countries such as; the United States, Great Britain, Germany, Japan and Italy, Offiong (2001:195) corroborates the foregoing assertion by noting that cheered on by the western countries that dominate the World Bank, IMF and the Paris Club, the key aid donor, the  International Financial Institutions (IFIs) impose incessant conditionalities to make sure that these poor countries continue to pay their debts..

Such agencies such as United States Agency for International Development (USAID) and  the Department of International Development (DFID) of Britain are charged with the direct administration of Aid funds in benefiting countries. These agencies have a country mission, containing key areas that have posed a major problem to underdeveloped countries. In contradistinction, it is pertinent to note that the activities of such agencies, greatly affect the ability of home governments to evolve indigenous development programmes. Thus they remain tied to the conditionalities of these advanced capitalist countries. With this new pattern, the underdeveloped world would remain in peripheral dependence and reliance on the advanced capitalist countries. In view of the foregoing facts, this study therefore focuses on examining the interface between United States government’s foreign assistance and the dependence of Nigeria on United States for her national development, 1999-2007.

 

1.2       Statement of the Problem

            The pride of any government is the attainment of higher value level of development in such a way that its citizens would derive natural attachment to governance. Development is critical and essential to the sustenance and growth of any nation. A country is classified as developed when is able to provide qualitative life for her citizenry. Nigeria in the last forty seven years has been battling with the problems of development in spite of huge human, material and natural resources in her possession.

Gboyega (2003) captures development as an idea that embodies all attempts to improve the conditions of human existence in all ramifications. It implies improvement in material well being of all citizens, not the most powerful and rich alone, in a sustainable way such that today’s consumption does not imperil the future, it also demands that poverty and inequality of access to the good things of life be removed or drastically reduced. It seeks to improve personal physical security and livelihoods and expansion of life chances.

Naomi (1995) believes that development is usually taken to involve not only economic growth, but also some notion of equitable distribution, provision of healthcare, education, housing and other essential services all with a view to improving the individual and collective quality of life.

Chrisman (1984) views development as a process of societal advancement, where improvement in the well being of people are generated through strong partnerships between all sectors, corporate bodies and other groups in the society. It is reasonable to know that development is not only an economic exercise, but also involves both socio-economic and political issues and pervades all aspects of societal life. National development therefore according to Chrisman (1984) can be described as the overall development or a collective socio-economic, political as well as religious advancement of a country or nation. This is best achieved through development planning, which can be described as the country’s collection of strategies mapped out by the government.

We have had series of development plans in Nigeria. Nigeria is permanently hunted by the spectre of development. Its forty-seven years of independence actually are rolling by daily in search of development. The myth of growth and development is so entrenched that the country’s history passes for the history of development strategies and growth models from colonial times up to date. No term has been in constant flux as development. This seems the only country where virtually all notions and models of development have been experimented (Aremu, 2003).

Two years after independence, the First National Development Plan policy was formulated between 1962 and 1968 with the objectives of development opportunities in health, education and employment and improving access to these opportunities, etc. This plan failed because fifty percent of resources needed to finance the plan was to come from external sources, and only fourteen percent of the external finance was received (Ogwumike, 1995).

Collapse of the first Republic and the commencement of civil war also disrupted the plan. After the civil war in 1970, the second national development plan 1970 to 1974 was launched, the plan priorities were in agriculture, industry, transport, manpower, defence, electricity, communication and water supply and provision of social services (Ogwumike, 1995). The third plan, covering the period of 1975 to 1980 was considered more ambitious than the second plan. Emphasis was placed on rural development and efforts to revamp agricultural sector. The fourth plan 1981 to 1985 recognized the role of social services, health services, etc. The plan was aimed at bringing about improvement in the living conditions of the people. The specific objectives were: an increase in the real income of the average citizen, more even distribution of income among individuals and socio-economic groups, increased dependence on the country’s material and human resources, a reduction in the level of unemployment and underemployment (Ogwumike, 1995).

During these periods, Nigeria’s enormous oil wealth was not invested to build a viable industrial base for the country and for launching an agrarian revolution to liquidate mass poverty. For instance, the Green Revolution Programme that replaced Operation Feed the Nation failed to generate enough food for the masses. In the recent past, various strategies for development have also been tried with little or no result; among these were the structural adjustment programme (SAP), Vision 2010, national economic empowerment and development strategy (NEEDS), creation of development centres, etc. currently, seven point agenda of the present administra-tion with vision 2020 without any clear methodological approach towards achieving them. It is obvious that the current results so far are not what development connotes.

The United States has over the years been involved in Nigeria’s quest to achieve sustainable economic growth and development. This emphasis on Nigeria by the United States is based not only on the formers stated rejection of global terrorism but also on the trade relations between the two countries (albeit a patron-client trade relationship). The United States is the largest consumer of Nigeria’s petroleum product. Moreover, most of her oil multinational corporations are operating in the Niger Delta region of Nigeria. So the United States gains a lot of material benefit from Nigeria. This favourable disposition of Nigerian economy to American foreign policy and economic interests attracts a concern with the problems of development and poverty; that have constituted a cog in the wheel of development of the Nigeria economy.

However, it is pertinent to note that the concern shown by the United States government to Nigeria’s problems of underdevelopment and poverty stems from her continued enjoyment of the latter’s support of her foreign policy and economic interests within her territory and the African continent. Thus, United States government Aid to Nigeria government can be viewed as a veritable tool for maintaining the patron-client relationship between the two countries. The United States uses foreign assistance to Nigeria to perpetuate the dependence of Nigerian economy on the United States. Despite the economic and political shortcomings of United States Aid to Nigeria; Nigeria leaders perceive U.S aid as a veritable means for achieving rapid economic growth and development.

The foregoing is in congruence with the western model of foreign assistance. The Western capitalist countries adumbrate the use of foreign aid to attract economic development to the third world countries. Goldstein and Pevehouse (2008:419), thus they conceptualize foreign aid as overseas development assistance; which is essential for the take off for third world countries economic development. However, the dimension of United States aid to third world countries have changed considerably, in the aftermath of the September 11, 2001 terrorist attack on the United States (Goldstein and Pevehouse 2008:492). The United States subsequently raised its aid budget with the aim of fighting poverty, which breeds extremism. The United States aids to third world countries such as Nigeria have not been left on the hands of the recipient government to administer. Rather the United States Agency for International Development (USAID) is charged with the responsibility of administering aid in recipient countries. USAID also ensures that recipient countries adhere to the conditionalities of the United States. Basically, U.S aid is tied to the acceptance of western model of development, democracy, global fight against terrorism, most importantly; U.S economic interests in recipient countries.

`           The United States is the largest foreign investor in Nigeria. The stock of U.S foreign Direct Investment (FDI) in Nigeria in 2006 was $339 million down from $2 million in 2004. The U.S FDI in Nigeria is concentrated largely in the petroleum, mining and wholesale trade sectors. Exxon-Mobil and Chevron are the two largest United States corporate players in off shore oil and gas production. Moreover, Nigeria is the United States largest trading partner in sub-Saharan Africa, largely due to the high level of petroleum imports from Nigeria, which supplies 11% of United States oil imports, nearly 46% of Nigeria’s daily oil production. Nigeria is the fifth largest exporter of oil to the United States. United States import from Nigeria in 2008 was over $38 billion, consisting predominantly of oil. Given the trade and economic relations which favours the United States, the latter is concerned with ensuring that the parasitic relationship continues. Thus, the use of foreign aid to influence policymakers in Nigeria, thereby ensuring that the Nigerian economy remains dependent on the United States.

The foregoing greatly illustrates the role of foreign aid in perpetuating dependence in the global economic order. Evidently development aid from the U.S to Nigeria often contain conditionality which gradually commit Nigeria to the economic and foreign policy objectives of the United States at the expense of Nigerian economy. With the high level of involvement of USAID in domestic policy formulation and implementation in Nigeria, it will be unimaginable Nigeria breaking loose from the chains of dependence. The commitment of the United States government to economic development programmes in Nigeria have been commended by, not only Nigerian policymakers but also certain researchers who asserts that Nigeria is benefitting from such programmes sponsored by USAID, such as in the area of reproductive healthcare intervention programmes (Unumeri, 1997).

However, it is pertinent to note that such programmes stifle the development of indigenously formulated programmes. With this situation, Nigeria dependence on the United States is re-affirmed and the emergence of endogenous development on Nigeria belittled. Essentially, with these programmes financed by USAID still in place, Nigerian leaders will continue to neglect the dire need to enact policies, and programmes that will steer the nation towards the paths of self-reliant development. The policymakers in Nigeria are now resting on their oars, growing fat from the public funds that they should have used for coherent agricultural and healthcare development. After all the USAID and other international Development Agencies (IDAs) are now doing their works for them.

The implication of the above is that indigenous food security programmes that impacted positively on Agricultural Development in Nigeria such as the Green Revolution, Operation feed the Nation etc are no longer considered necessary for implementation. Likewise, there are no new innovations in the healthcare sector. The fight against HIV/AIDS, Malaria, Polio, infant mortality and reproductive health are all spearheaded by the USAID, GHAINS and what a withdrawal of their funding would imply for Nigerian healthcare delivery system. It s better imagined that experienced. Though the United States is in no hurry to withdraw Development Aid to Nigeria, as it serves their interests better which is the continued exploitation and dependence of Nigerian economy on the United States.

Owing to the foregoing facts, the study will therefore concern itself with answering the following questions, which revolve around the use of foreign aid by the U.S government to ensure dependence of Nigeria to the United States. The questions that will be addressed empirically are as follows:

• Did United States government’s health intervention measures lead to dependence of Nigeria for her healthcare delivery?

 

• Did United States government’s food security intervention measures boost agricultural productivity in Nigeria?

 

1.3       Objective of the Study

The broad objective of this study is to investigate whether foreign aid from United States government to Nigeria had any effect on her dependence on the United States economy.The specific objectives are as follows:-

• To investigate whether United States Government’s healthcare intervention measures led to dependence of Nigeria for her healthcare delivery.
• To investigate whether United States Government’s food security intervention measures boosted agricultural productivity in Nigeria.

 

1.4       Significance of the Study

This study derives its significance from both theoretical and practical levels. At the first level, the study provides a theoretical framework for understanding North-South relations in the global economic order, exposing the tools which the rich countries of the North use in ensuring that the poor countries of the south remains subjugated and dependent on them. It shows how foreign aid is used to hijack the economy of the global south, in the North-South divide. The study contributes to the existing literature and debate on the link between the western model of foreign economic assistance and dependency.

On the practical level, the study serves as a guide to Nigerian leaders and policy makers on the philosophy and politics of foreign aid. It exposes the role of foreign aid in perpetuating dependence and the need for Nigeria to be as self-reliant as possible, in the quest for economic growth and development. It will therefore serve as a policy guide to the Nigerian government on the area of domestic policy formulation and implementation. This study has both theoretical importance and analytical contribution as it serves as a reference source to students and scholars working on a similar topic.

 

 

 

CHAPTER TWO

LITERATURE REVIEW

The use of foreign aid or foreign economic assistance has been widely advocated by academicians and policy makers as a road to development (Chiaka 1989:17). However, Aid as noted by (Spero 1977:143) “is neither a second-best solution for North-South relations or a meaningful redistribution of economic benefits”. Foreign aid became a popular phenomenon in world politics with the heightening of the cold war. The bipolar structure created a necessity to counter any measure by the other party to acquire more relevance in the comity of nations. This economic aid was used because it fitted well the “desire of the developed market states to maintain the existing structure of international economic relations and at the same time to garner political influence in the developing world by responding to southern desires for development” (Spero, 1977:143). Despite the stated commitment of the advanced capitalist countries to encourage economic development in the south through economic assistance, the global south is still crippled by poverty, health issues and underdevelopment.

Ituma (2008:19) notes “the existence of an abundant literature on Nigeria-U.S relations. He posits that scholars such as; (Ate 1986, 2000, Lyman 1988, Olukotun 1990, Onuoha 2005, Salihu and Aremu 2006) etc., have all adopted various perspectives to examine the general character and fundamental basis of the relationship between Nigeria and the United States”. Such studies focused mainly on the link between United States energy demands and Nigeria foreign policy. Having said these, the study shall now delve into the review of extant literature that focuses on the research questions.

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