WHY WORLD BANK STILL RATES NIGER

This question is currently causing an internal division at the bank's headquarters in Washington DC and raising questions in international circles about the actual impact of Nigeria's reform agenda especially in the last three years.

An internal report of the World Bank titled "Strengthening the World Bank's Rapid Response and Long-Term Engagement in Fragile States, recently released listed Nigeria as one of the fragile states that was reviewed by the Operations Policy and Country Services Fragile States Group.

Other states reviewed as fragile along Nigeria included Angola, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Eritrea, The Gambia, Guinea-Bissau, Lao and Mauritania.

Myanmar, Papua New Guinea, Sao Tome and Principe, Sierra Leone, Solomon Islands, Somalia, Timor-Leste, Togo, Tonga, Uzbekistan, West Bank/Gaza and Zimbabwe were also considered alongside Nigeria as a fragile state. The internal report meant for the consumption of the World Bank staff also added few other states as Fragile but with major recovery operations and Nigeria was not even included among such countries. The countries that featured as undergoing major recovery operations included Afghanistan, Democratic Republic of Congo, Haiti, Kosovo, Liberia and Sudan.

A World Bank official said at the last Annual Meeting of the World Bank in Singapore in October the issue of the fragile states come up and Nigeria's inclusion caused quite a stir as the Africa Group at the World Bank opposed the categorization of Nigeria among fragile states.

The World Bank defines a fragile state based on its internal Country Policy and Institutional Assessment, CIPA, exercise. Mostly they are countries with a significant number of the world's poor people, states that create negative spill-overs such as conflict, instability and refugees flows for their neighbours. Also a fragile state is seen as a country "that lacks either the will or the capacity to engage productively with their citizens to ensure security, safeguard human rights and provide the basic functions for development."

The Bank further notes in the said report that fragile states "confront particularly severe development challenges such as weak governance, limited administrative capacity, chronic humanitarian crises, persistent social tensions, violence or the legacy of civil war."

Indeed Nigeria is categorized with Afghanistan as one of the few countries under World Bank programmes for Low Income Countries Under Stress, LICUS initiative, that have a significant World Bank presence. LICUS is also linked with the Bank's assistance and support to fragile states. A source said the Bank takes Nigeria quite seriously for the country to be among the most staffed on the field, even though the bank is seeking to improve its staffing levels in the country offices.

A top official of the World Bank Africa Group in Washington DC, John Donaldson explained over the weekend that the Africa Group at the bank's headquarters and the Nigeria Country Office of the World Bank do not agree with the assessment that Nigeria is still listed as a fragile state.

While confirming that the rating of Nigeria as a fragile state came up in Singapore last year, Donaldson explained that the report by LICUS on the fragile states are done very three years and that Nigeria was on that list also in 2003 and kept there in the latest report last year. He said the World Bank section that handles the rating will put any country that fits their profile of fragile state on the list, adding that "it is tough to get off the list once you are in it."

Donaldson, who is a Senior External Affairs Counsellor for Africa Communication at the World Bank Headquarters explained that the rating on fragile states is handled for the Bank by an independent arm of the bank. He said he suspected that the group that made the assessment may have depended on "old data" most of which he aid may have been restrictive.

"When we learnt in Singapore that Nigeria is still on the list of fragile states we were surprised" he disclosed adding that in the World Bank there is a difference of opinion about Nigeria being a fragile state."Operations wise, we don't consider Nigeria as a fragile state," he added. He stated that there were protests against Nigeria's listing and formal protests have been made, but the next review of the list is set for 2009.

However, as far as the Africa section of the Bank is concerned Donaldson explained, it is the kind of programmes that the World Bank operates in Nigeria that would determine whether the country is truly fragile or not.

He said the programmes of the bank in Nigeria are such that recognises "the progress made in fighting corruption, for instance in the return of Abacha funds." He said Nigeria is unique in size and the complexity of the countries economy, the income and the assets make it unbelievable for it to be listed as fragile. "it is unfortunate that Nigeria is still on the list," he observes.

Commenting a Nigerian US-based policy institute Solon Institute stated that based on available data "from well respected world agencies, such as the World Bank and the Heritage Foundation, the much touted economic reforms of President Olusegun Obasanjo, has so far has yielded infinitesimal benefit at best."

In a statement signed by its chairman and Secretary, Prof. Edward Oparaoji and Dr. Eugene Ezekueche, the institute said "in our assessment, Obasanjo's grade has improved from an F to an E, but still below the passing grade. One measure of economic well being of a nation is the Index of Economic Freedom. This is a simple average of 10 individual freedoms, each of which is vital to the development of personal and national prosperity."

The Solon Institute referred to the recently published 2007 index of economic freedom, by the US based Heritage Foundation, which shows Nigeria’s economy is 56.5% free, which ranks Nigeria 131 out of 160 countries evaluated world wide and 30 out of 40 countries in the sub-Saharan African region. The institute noted that "while this ranking is an improvement from 2006 when Nigeria ranked 146, her overall score remains lower than the regional average."

In addition the institute explained that "a World Bank report in the Revenue Fact Sheet of the Organization of Petroleum Exporting Countries (OPEC), disclosed that about 80 per cent of Nigeria’s oil and natural gas revenues accrue to just one per cent of the country’s population. The other 99 per cent of the population receive the remaining 20 per cent of the oil and gas revenues, leaving Nigeria with the second lowest per capita oil export earnings at $212 per person in 2004."

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