This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 10 ABUJA 003162 
 
SIPDIS 
 
 
DEPT FOR AF/W; DON BOOTH AND SOOKY PARK 
ALSO FOR AF/EPS 
STATE PASS TO AID-AFR 
 
 
E.O. 12958: N/A 
TAGS: EAID ECON PGOV PHUM PREL NI
SUBJECT: NIGERIA: ESF PROPOSALS FOR FY 2002 
 
 
¶1.  The following is Embassy Abuja's ESF funding proposals 
for FY 2002 
 
 
FY 2002 ECONOMIC SUPPORT FUNDS 
U.S. Mission Nigeria Proposals 
 
 
Program Overview 
 
 
Nigeria has significant strategic value to the United States. 
 The world's eighth largest oil producer, Nigeria ranks as 
the fifth largest supplier to the United States, providing 
ten percent of total U.S. oil imports.  Nigeria also is a 
potential major supplier of natural gas, having the eighth 
largest reserve in the world.  Nigeria commands Africa's 
second largest economy, is the largest U.S. trading partner 
on the continent, and represents a huge potential market for 
American producers.  Moreover, Nigeria stands as the dominant 
economic and political actor in the West African sub-region. 
 
 
With a population of over 120 million, Nigeria is Africa's 
most populous nation and its largest democracy.  It also has 
Africa's largest Islamic population, numbering roughly 60 
million Muslims.  A stable, prosperous Nigeria that values 
democracy and its processes will improve the lot of its own 
people, which translates into benefiting one of every five 
Africans. 
 
 
 
 
Since the 1999 return of civilian government, the 
U.S.-Nigerian bilateral relationship has been a productive 
one.  Nigeria has promoted democratization and taken an 
active role in conflict resolution in countries such as 
Liberia, Sierra Leone, Guinea Bissau, Cote d'Ivoire, The 
Congo, Burundi and Sudan.  Additionally, Nigeria has taken a 
constructive position on important transnational issues such 
as counter-narcotics and HIV/AIDS.  Since September 11, 
Nigeria has voiced strong public support for U.S. operations 
in Afghanistan and has been at the forefront of African 
counter-terrorism efforts.  Nigeria has become an important 
ally for America on many issues. 
 
 
However, Nigeria's democratic transition is not complete. 
The electoral process is unsettled and susceptible to 
violence.  Communal violence and tensions have threatened 
internal security in many areas.  At the root of many of 
these outbreaks are poverty and unemployment.  Despite some 
reforms such as progress on privatization, the non-oil 
economy is not robust and has not produced the job and income 
opportunities many had expected.  Too many Nigerians still 
await their democracy dividend. 
 
 
The over-arching U.S. goal in Nigeria is to help protect the 
country's long-term internal stability by promoting democracy 
and sound economic reforms.  A vibrant democracy devoted to 
good governance and the rule of law will advance U.S. goals 
here and throughout the continent.   Direct investment in the 
non-oil sector is an essential component for job creation, 
poverty reduction and thus, political stability.  The U.S. 
can help Nigeria lower the barriers for those who wish to 
play a productive role in the national economy. 
 
 
Given Nigeria's pro-western leaning and its visible public 
support for our counter-terrorism efforts in Afghanistan, we 
should provide significant support to Nigerian 
democratization, stability  and economic development. 
Provision of FY 2002 ESF will show that the U.S. has not 
forgotten Africa and that close African partners, such as 
Nigeria, can derive concrete, tangible benefit from aligning 
their interests with ours. 
 
 
 
 
DEMOCRACY AND GOVERNANCE 
 
 
U.S. Policy Objectives and National Interests 
 
 
Strengthening democracy is critical to the long-term 
stability of Nigeria. Democratic governance safeguards human 
rights and promotes the rule of law. It provides a conducive 
environment for private investment and economic growth, and 
helps position Nigeria to sustain a constructive role beyond 
its border.  A democratic Nigeria portends increasingly 
closer bilateral relations and enhanced cooperation on 
regional security, counter-terrorism, and international law 
enforcement and other important USG interests.  America's 
interests benefit if Nigerian democracy succeeds. A deciding 
factor will be the quality of the 2003 elections. 
 
 
The 2003 elections present both a challenge and an 
opportunity for Nigeria's democratic effort. With elections 
less than two years away, the informal campaign already has 
begun.  The campaigning is intense and not always positive. 
Without well-placed electoral assistance, 2003 could repeat 
the irregularities that plagued the 1999 exercise, causing 
many observers to deem them flawed.  Potential obstacles 
include inadequate election administration, insufficient 
civic participation and widespread cynicism born of political 
corruption.  Moreover, the risk of electoral violence is high 
and could mar the process.  What happens during the lead-up 
to election, especially voter registration, will be as 
critical as the balloting itself.  It is important that the 
entire electoral process be viewed by most Nigerians as a 
transparent, democratic improvement over the 1999 exercise. 
 
 
In addition to ensuring credible elections, concerns 
regarding federalism and decentralization need to be resolved 
in a way that promotes good governance and a tolerant 
political culture.  New relationships need to be forged among 
the different levels of government and between government and 
civil society in order to deal more effectively with the 
issues of democracy and governance. Also, Nigeria's police 
force needs to be capable of providing the security essential 
to political stability, while being cognizant of the rule of 
law and human rights considerations. 
 
 
 
 
¶I. Elections Assistance:                  Total $7.15 million 
 
 
 
 
ESF can help move Nigeria toward successful elections.  The 
USG already has committed $2 million in FY-2001 ESF to 
support the administration of elections. These funds provide 
technical assistance through December 2002 to Nigeria's 
Independent National Electoral Commission (INEC) and to State 
Independent Electoral Commissions (SIECs) for elections 
administration training.  While FY-2001 funding is an 
important initial contribution, a wide range of assistance is 
still needed to ensure the coming elections are conducted 
properly and to integrate non-partisan elections 
administration into the matrix of Nigeria's political process. 
 
 
International standards would call for an expenditure of at 
least 60 million to fund elections preparations in Nigeria 
(one dollar per estimated voter.)  However, INEC was only 
allocated $12 million so far (The remaining $25 million of 
the FY-2002 INEC budget was reserved for infrastructure 
improvements that may be needed by INEC but do not directly 
prepare its staff for the actual administration and conduct 
of elections nor enhance the electoral process.) 
 
 
Clearly, there is a budgetary shortfall. The proposed $7.15 
million in FY2002 ESF would help reduce the deficit.  The 
Mission has established an Inter-Agency Elections Working 
Group, and in close coordination with other donors, will 
implement the following assistance: 
 
 
¶A. Consolidating INEC Election Administration and Capacity 
Building. FY-2001 ESF funded voter registration database 
development and training in logistics management.  However, 
INEC's technical capacity, while improved, remains limited 
and will be seriously tested during the 2002-2003 elections. 
The USG is well positioned to provide technical assistance 
due to the strong relationship between INEC and the 
International Foundation for Elections Systems (IFES), a key 
USAID partner.  FY 2002 ESF will fund the continuous 
presence, through December 2003, of IFES's 
internationally-recognized senior elections administration 
advisor, as well as numerous training events and consultants 
in specific areas of electoral administration and electoral 
law reform.  The senior advisor has already played an 
invaluable role by providing guidance on international 
electoral standards, INEC's budget submissions, conflict 
management, and development of a code of conduct for 
political parties.  A major focus of the additional (FY 2002) 
 technical assistance will be monitoring implementation of 
logistics plans for the 2003 elections.  ESF assistance will 
establish post-election mechanisms to evaluate INEC's 
performance and to begin strategic planning for the 2007 
elections. An aim of that strategic review would be to ensure 
that elections planning becomes an integral part of normal 
government operations. ($2.7 million) 
 
 
¶B. INEC Polling Station Officers Training.  FY-2002 ESF will 
fund IFES preparation of a manual for the 120,000 polling 
station officers who will oversee the actual voting 
throughout the country, and train INEC staff to conduct 
orientation workshops for these officers.  These polling 
station officers are temporary employees engaged shortly 
before the elections.  Basic orientation on policies and 
procedures is needed for them to perform their critical task 
of ensuring that voting at their stations is conducted 
properly and fairly.  Given the shortage of INEC resources, 
the quality of training will be inadequate unless outside 
assistance is provided.  IFES has already evaluated INEC's 
training resources and created a training plan by which INEC 
will fund the attendance of the trainees, while IFES provides 
training materials and workshop oversight.  ($700,000) 
 
 
¶C. Party Poll Agents Training:  Each candidate and party is 
permitted to have a representative at each polling station. 
Party-affiliated observers, as well as independent observers, 
are critical to keep irregularities and, thus, potentially 
violent protests to a minimum.  However, party observers can 
add confusion if misinformed about electoral procedures. 
This program element will provide manuals, 
training-of-trainers, and overall coordination among the 
political parties to train up to 500,000-600,000 party 
agents. The International Republic Institute (IRI) will 
implement this program.  IRI has established relationships 
with Nigerian political parties over the past two years 
through its work on grassroots organizational development and 
promoting women's participation in political parties.  ($1.25 
million) 
 
 
¶D. Civil society and media campaigns to promote participation 
and non-violence: Civil society and media activities must be 
intensified for the 2003 elections.  This program utilizes 
Nigerian NGOs to promote civic awareness, greater public 
participation in the pre-elections phase and higher voter 
turnout. The other component of the program will be to 
discourage the violence that has often discredited elections 
in Nigeria.  The project will create mechanisms to mediate 
conflict and disseminate non-violence and voter education 
messages.  The program will be administered through a 
pre-existing USAID civil society assistance program. 
Individual NGOs will be selected through a proposal process 
coordinated with the Transition Monitoring Group, a Nigerian 
NGO coalition. ($1.3 million) 
 
 
 
 
¶E. U.S. Election Observers:  USAID will use FY-2002 ESF to 
support a team of high-level election monitors from the 
United States, as was done for the 1999 elections.  Funds 
will be provided to one or more U.S. institutions (IFES, NDI, 
Carter Center, IRI) to field an observation team.  Details of 
this activity will be developed as interested organizations 
are identified. ($400,000) 
 
 
¶F. Media Training:  Training would be provided to media 
practitioners on elections procedures, ways of using and 
analyzing voting data, and standards of professionalism for 
media coverage of the elections.  To be implemented through 
IFES and USAID's civil society assistance program. ($300,000) 
 
 
¶G. Elections Tribunals Assistance:  FY-2002 ESF will provide 
basic orientation on the new electoral law and on 
international standards for election tribunal judges.  The 
program will also include a public education campaign about 
the tribunals. Building effective tribunals promotes the rule 
of law and peaceful resolution of elections disputes, 
reducing the chance of election-related violence and 
instability.  The judges will be trained on the new electoral 
law, given an orientation on elections procedures, and 
provided access to relevant legal precedents from other 
countries.  This program would be implemented through a 
pre-existing USAID assistance project that works with several 
high courts and the National Judicial Institute of Nigeria 
and includes grants to local NGOs for public education. 
($400,000) 
 
 
 
 
 
 
II.   Nigerian Governors' Forum:                      $850,000 
 
 
Governors are becoming important political players in 
Nigeria; they control significant resources and have 
established themselves as major decision-makers and agents of 
influence.  Their political capacity has been visible in 
recent debates over the electoral law and resource allocation 
(oil revenue) between state and federal governments. 
Collectively, governors will play a large role in shaping 
Nigerian federalism and in determining whether devolution 
will advance genuine democratization and good governance.  As 
more resources are decentralized, the governors will need 
expertise and technical assistance on financial and budgetary 
management, federalism, economic policy, social services 
administration, and other key issues of governance.  Improved 
inter-governmental relationships are needed to facilitate 
federal-state coordination of fiscal policy, environmental 
policy, investment incentives and other issues. 
 
 
Using FY-2002 ESF to support the Nigerian Governors Forum 
will give the USG influence and access to key governors while 
promoting federalism and viable decentralization of power and 
resources. Support to the Forum will be in the form of 
limited technical assistance and equipment to establish a 
secretariat in Abuja and to assist in developing an action 
 
SIPDIS 
plan to engage different levels of government on policy 
issues key to decentralization, economic development and 
investment. The federal-state dialogue will be helped by 
providing the Federal Government a single entity with which 
to confer on those issues common to the states.  The project 
will also focus on a long-term plan to sustain the 
organization. 
 
 
USAID, through its implementing partner, the National 
Democratic Institute for International Affairs (NDI), has an 
established relationship with the Governors' Forum that dates 
back to the election in 1999.  Because NDI is established in 
Nigeria, assisting the Forum will be cost-effective and will 
not require start-up administrative costs. 
 
 
III. Labor Union Strengthening:                  $1,500,000 
 
 
Labor unions represent the largest organized section of 
Nigeria's civil society.  Although weakened by years of 
military rule, labor can bring the nation to a standstill by 
go slows or a general strike and can block important economic 
reform.  Moreover, labor is important to the Nigerian oil 
sector and American economic interests in that sector, as 
well as the stability of the environment in which American 
companies operate. 
 
 
Current funding touches a wide spectrum of Nigerian 
institutions but does not engage labor.  Because of our lack 
of contact, we have little access and influence with the 
labor movement. Insufficient contact with the international 
community diminishes labor's perceptions of the market 
economy. Too often, Nigerian labor groups embrace statist 
platforms that might have had utility during military rule 
but now serve to retard reform, growth and good governance. 
We must incorporate labor into our plans for economic and 
political reform.  If we can influence labor and enhance its 
understanding and support for reform, labor can become a 
voice for democratization and economic reform instead of a 
brake on these objectives. 
 
 
We can influence labor leadership through a project designed 
to bolster the internal administration of labor organizations 
as well as to augment labor's understanding of political and 
economic democratization. 
 
 
Major recipients of training and other capacity-building 
activities will be the Nigerian Labor Congress (NLC) and the 
Trade Union Congress of Nigeria (TUCN-formerly the Senior 
Staff Consultative Association of Nigeria).  These are the 
two main national trade union umbrella organizations (NLC for 
blue-collar workers and TUCN for white-collar workers). 
Sector-specific unions in the oil and gas industry will also 
be engaged.  The program will target leaders at the state and 
national level for over two years.  Two-years are needed to 
implement a program and is the critical period during which 
labor must be convinced to play a constructive role in the 
electoral process. 
 
 
Activities will include basic training in economic policy for 
national and state-level leaders, basic organizational and 
management training, and the provision of training materials 
and basic communication and information technology at several 
organizational levels.  After the abuses of the previous 
government, there is a serious need to rebuild a leadership 
cadre attuned to the nuances of economic policy as well as 
the requirements of political participation in a democracy. 
Additionally, women leaders will be targeted to increase 
their leadership skills and improve overall representation of 
women in the male-dominated labor union leadership. 
 
 
This program will be implemented through a cooperative 
agreement between USAID and the AFL-CIO'S Center for 
International Labor Solidarity, which has had an ongoing 
relationship with the NLC and TUCN for more than 30 years, 
despite the difficulties imposed by sustained military rule. 
 This history makes it possible for the Solidarity Center to 
build an extensive program of training for the newly 
revitalized unions, and the proposed program has been 
developed in direct collaboration between the Solidarity 
Center and the two Nigerian labor centers. 
 
 
IV. Addressing the Trafficking in Persons (TIP):  $500,000 
 
 
The illegal trafficking in persons is a growing concern in 
Nigeria.  While economic conditions factor heavily in the 
problem, trafficking and its resultant servitude is a grave 
violation of human rights. Such a practice undermines 
democracy, the rule of law and the legitimate economy. 
Moreover, it promotes criminality and disregard for 
individual rights, particularly those of society's most 
vulnerable members. As such, it is a source of both injustice 
and instability. 
 
 
This important program will be implemented by INL through an 
international organization already working in this field, 
such as UNICEF, IOM or ILO-IPEC.  The GON recently created an 
inter-agency committee to better coordinate federal 
assistance to victims of trafficking rescued overseas and 
repatriated to Nigeria.  ESF funds will assist the committee 
in building a nation-wide structure for short-term care and 
long-term vocational training of trafficked victims in order 
to minimize recidivism.   Most assistance will be used to 
defray non-recurring start-up costs of establishing shelters 
and training centers.   This will complement: 1) the 
ILO-IPEC's new project ($300,000 of USDOL funds) to assist 
the GON establish a National Plan of Action Against 
Trafficking of Persons and expanding awareness programs among 
at-risk populations; 2) the IOM's new $2.1 million project to 
assist the repatriation of trafficking victims and train law 
enforcement personnel; and 3) an INL project to equip and 
train the small Nigerian 
Police Anti-Trafficking Task Force based in Lagos. 
 
 
¶V. Police Modernization:                   $2.0 million 
 
 
Years of neglect during military rule left the police force 
demoralized, understaffed and under-equipped.  The force as 
now constituted is unable to fulfill its mandate under a 
civilian government.  The police's failure to contain several 
instances of communal violence demonstrates its institutional 
and operational inadequacies, despite the current political 
will within Nigeria to develop a professional force. 
Moreover, too many police officers are not familiar with 
criminal procedure, modern investigative techniques, 
community liaison and human rights.  To promote the rule of 
law and engender that sense of security needed for a 
democracy to function, the police needs to be modernized.  A 
more professional police force would have the salutary effect 
of reducing the military's role in internal security and law 
enforcement, a role that inevitably leads to serious 
violations of human rights. A needed initial step in this 
overall effort is to improve the police force's central 
administration. To do its job on the 
 streets better, the force must first improve the way it 
manages itself. 
 
 
This program will be implemented by INL.   Building on modest 
activities begun with FY01 ESF, this project will seek to 
strengthen management and administration of the Nigerian 
Police Force through technical assistance ($1.25 million) and 
the continued provision of organizational management training 
for senior -level Nigerian Police Force managers ($750,000). 
Implemented through a contractor with experience in both 
organizational management and law enforcement, the project 
will provide technical assistance in the form of repeated 
visits by two or three short-term (60 days) advisors who will 
review the NPF's management system and administrative 
structure.  With the agreement of NPF managers, the technical 
advisors will help the Inspector General of Police and his 
staff implement new procedures to increase transparency, 
improve budgetary planning and allocations, encourage the 
delegation of authority and feedback from subordinate 
officers. 
 
 
 
 
The training will be implemented by the same contractor 
already working closely with the U.K. DFID "Accessible 
Justice" program of assistance to the police and judiciary. 
The training in advanced organizational management techniques 
will seek to familiarize senior police officials with 
management techniques that have proven successful for large 
companies in the business and corporate world and would not 
cover police operational matters (thus ESF could be used to 
for this project). Several one or two week sessions of this 
course will be offered at the NPF Jos Staff College. 
 
 
 
 
 Overall, this project will build on a joint AID-INL effort 
with FY01 funds (both ESF and INC) to create an 
administrative and criminal database to manage human and 
material resources as well as criminal cases.  As such, this 
initiates a new phase in the USG's long-term police 
modernization program in Nigeria. 
 
 
 
 
ECONOMIC GROWTH 
 
 
Corporate Responsibility Initiative 
(The Niger Delta - South) 
 
 
 
 
U.S. Policy Objectives and National Interests 
 
 
 
 
This initiative is concentrated in the Delta region. 
Promoting public/private partnerships in that area and 
facilitating collaboration between the oil companies, state 
governments, and local communities furthers U.S. interests in 
democracy, governance, economic trade, and development.  The 
Delta is an important source of the fossil fuel needed to run 
the U.S. economy, yet it is also an economically deprived, 
politically tense and environmentally challenged region. 
Social unrest and violent outbreaks happen frequently.  Many 
local inhabitants blame oil companies, including U.S. 
entities, for this depressed situation.  As elections draw 
near, the political heat in the Delta will likely rise due to 
this perceived inequality.  U.S. interests lie in creating a 
secure environment where oil companies can operate safely and 
the supply of fuel to U.S. markets is not interrupted.  Our 
interests are best served when local communities feel they 
derive some benefit from the operation of U.S.-based 
companies. 
 
 
A project that requires the cooperative efforts of state 
governments, NGOs and the oil companies will reduce political 
tension and conflict in the area.  This also will help reduce 
the prospect of electoral violence in the region. 
Additionally, the initiative will promote human rights and 
the rule of law. 
 
 
For local inhabitants, U.S. companies in the Delta represent 
the United States more so than the Embassy.  By encouraging 
corporate responsibility and best practices in the area, we 
improve the image of these companies and, by extension, 
improve perceptions of the U.S. among the people of the Delta 
and in Nigeria overall. 
 
 
The upstream oil industry provides 90 percent of total export 
earnings, and, as such, is a major determinant of the 
political and economic situation in Nigeria.  Although 
two-thirds of Nigeria's oil comes from the Delta, the region 
remains one of the least developed parts of the country, with 
poor roads, few clinics and schools, plus an enormous 
environmental problem.  Pipe-borne water comes only to the 
most privileged homes.  Water and soil pollution are serious 
concerns -- traditional livelihoods in farming and fishing 
are jeopardized in some areas.  Reports of widespread 
pollution, coupled with the execution of the Delta's leading 
environmental activist, sparked international criticism of 
the former military regime but also drew attention to the 
conduct of oil companies, particularly Shell, but also 
American concerns such as Chevron, Mobil, Texaco and Ashland. 
 
 
Equitable distribution of the country's US$10 billion annual 
oil revenues and the environmental and social (corporate) 
responsibilities of the oil multinationals are issues to be 
resolved. 
 
 
At current rates of production, it is estimated that 
Nigeria's oil reserves will be exhausted in less than 30 
years.  The Government therefore sees the need to diversify 
and broaden the country's revenue base.  One of these areas 
is to exploit the vast reserves of natural gas, which 
constitute the eighth largest in the world. U.S. companies, 
by engaging in good community relations and having 
cooperative relations with government, can position 
themselves to tap into this vast supply. 
 
 
However, oil or gas extraction companies will continue to 
attract political criticism and be the target of occasional 
unrest if the lives of residents of affected areas are not 
improved.  This project proposal will be an important initial 
step toward defusing a volatile, potentially destabilizing 
situation. 
 
 
 
 
Proposed FY 2002 ESF Program 
The Niger Delta (Southern Nigeria) 
$5,000,000 
 
 
 
 
The Embassy will foster cooperation among state governments, 
local communities, the Niger Delta Development Commission 
(NDDC), NGOs and oil companies.  The project will provide 
technical and policy assistance to state governments and the 
NDDC on governance and development.  It will support the 
establishment and operations of conflict resolution and other 
mechanisms that promote dialogue. This program aspect 
involves the states and NDDC, but equally important, it 
includes NGOs, local communities and oil companies.  With 
specific regard to the oil companies, the project will 
encourage implementation of the Voluntary Principles on Human 
Rights and Security while also promoting corporate 
responsibility best practices. 
 
 
Another focus of the project will be working with states in 
the Delta that do not have strategic investment plans.  The 
initiative will help develop these plans. After the plans are 
created, a portion of program funds will be utilized to help 
attract investment and funding from domestic and 
international sources for the implementation of the plans. 
The program likewise will help states with existing 
investment plans identify internal and external sources for 
specific investments. This segment of the program will be 
designed to involve governments, local communities, NGOs and 
the private sector in identifying priority economic and 
social development needs and developing a strategic framework 
that responds to these needs. The plans, when implemented, 
will increase employment, enhance the agricultural sector, 
and strengthen workforce productivity through skill 
development. These positive changes, in turn, will improve 
the security landscape and prospects for stability and 
democratization. A key element of this 
ESF activity will be identifying employment possibilities for 
unemployed youth in agro-processing and other income 
generating activities.  Providing employment opportunities 
for youth is key to the political and social stability in the 
Delta. 
 
 
USAID will have overall management responsibility for the 
activity.  In that case, USAID will prepare a competitive 
solicitation for a U.S. contractor or grantee to undertake 
the activities described above.  The successful U.S. 
contractor/grantee will be required to work collaboratively 
with local communities and the oil companies, as well as 
provide grants to community organizations.  USAID will work 
closely with the corporate responsibility staff at the 
Embassy to implement this activity. 
 
 
 
 
ECONOMIC GROWTH 
 
 
Public Private Partnership Initiative 
 (Northern Nigeria) 
 
 
 
 
U.S. Policy Objectives and National Interests 
 
 
Major urban areas in the predominantly Muslim North -- Kano, 
Kaduna and Jos -- have experienced increasingly violent 
communal conflicts. Other Northern areas are potential hot 
spots.  Many of these outbreaks have ethnic and religious 
overtones but unemployment and poverty are the root causes of 
these developments.  A mis-directed competition for scarce 
resources has produced violence not opportunity. Too many 
people have no jobs and little future prospects.  This makes 
a segment of the population, particularly the young urban 
underclass, susceptible to violence, radical solutions to 
their problems and political manipulation. Many of them see 
modernity as pitted against them.  The number of people in 
this category makes this both an economic concern as well as 
a challenge to political stability in key Northern areas. 
 
 
By working to develop agriculture and other labor-intensive 
industries, we reduce the dry tinder that sparks unrest and 
advance the U.S. objective of political stability.  Moreover, 
active and visible engagement in economic development will 
counter the widespread perception that the USG is anti-Muslim 
and anti-North.  This will help mute anti-democratic and 
anti-West voices in this region of the country.  In light of 
September 11 and the criticism of US military action in 
Afghanistan that came from parts of Northern Nigeria, this 
project could not be more timely.  With Nigeria having the 
largest Muslim population in Africa, the poverty and 
deprivation in the North could become an invitation for 
Islamic radicalization inimical to U.S. interests in Nigeria 
and beyond. 
 
 
Proposed FY 2002 ESF Program 
Public-Private Partnership in Northern Nigeria  $5,000,000 
 
 
The same approach of partnering with the private sector and 
government in the Niger Delta can be applied to northern 
Nigeria. Public-Private Partnerships will help boost exports 
and expand employment opportunities, particularly in the 
agricultural sector. The program objective is to facilitate 
domestic, U.S. and third country investment in northern 
Nigeria's agribusiness and its not insignificant but 
under-utilized industrial base.  By helping to lay the 
groundwork for investment, the program will contribute to 
capacity-building in policy, technological know-how and 
agriculture grades, standards and regulations.  Export crops 
such as ginger and cotton will be considered for investment 
partnerships, although the final selection will be based on 
the ongoing survey of agricultural competitiveness. The 
garment industry and leather works, including 
shoe-manufacturing, are other areas of possible attraction. 
 
 
Another partnership proposal involves establishing an 
Information and Communication Technology (ICT) Center in one 
of the northern states.  Demand for the ICT will grow as a 
result of other USAID initiatives in agriculture, small and 
medium enterprise (SME) development and environmental 
protection.  The ICT will assist in implementing best 
practices and facilitating the flow of information among 
partners.  Partnerships are envisaged under this component 
with the Virtual University, State Governments and 
institutions of higher learning in the North.  Funding will 
be leveraged with other public and private sources; the state 
chosen would be expected to allocate a building for this 
activity.  This prototype, if successful, could be duplicated 
by other states. 
 
 
USAID/NIGERIA will prepare a competitive solicitation for the 
        U.S. contractor or grantee to undertake the 
activities described above. The contractor/grantee will be 
required to work with local communities and the private 
sector as well as provide small grants to community 
organizations 
 
 
ECONOMIC GROWTH 
 
 
Anti-Corruption Program in Nigeria 
 
 
U.S. Policy Objectives and National Interests 
 
 
Direct investment in non-oil sectors is key to job creation, 
poverty reduction and ultimately to political stability. 
However, the current environment of corruption and lack of 
transparency deter U.S. investors in these sectors.  To 
promote U.S. investment in Nigeria, we need to help Nigeria 
level the playing field for participants in the economy. 
Part of this effort will include building capacity to fight 
transnational crime, including money laundering, in support 
of post-September 11 U.S. priorities. 
 
 
Corruption permeates all levels of Nigerian society. 
Governmental corruption impedes transparency, retards 
efficient deliver of public services and undermines 
confidence in democracy. Cognizant  of these problems, 
President Obasanjo has demonstrated commitment to combating 
public sector corruption through the establishment of the 
Anti-Corruption Commission and the Independent Corrupt 
Practices and Other Offences Commission (ICPC) as well as the 
institution of value-for-money audits and due process for all 
federal government capital expenditures. 
 
 
USAID is currently funding, in collaboration with the World 
Bank, a comprehensive survey, which will provide detailed 
information on corruption in the country.  This information 
will be used to educate and inform federal, state and local 
governments, as well as civil society in an effort to build a 
constituency to combat corrupt misconduct. 
 
 
Proposed FY 2002 ESF Program 
Anti-Corruption Projects 
$1.0 million 
 
 
¶A. Public Sector Audit and Oversight: 
 
 
 Based on analysis of other donor activity and an assessment 
of institutional comparative advantages, the U.S. Mission 
recommends a series of initiatives over the short- and 
long-term that build on ongoing efforts.   Project activities 
will lie mainly in three areas: a) public sector assessment 
and training for internal auditing and oversight; b) ethics 
in public service; and c) promotion of civil society 
involvement in anti-corruption efforts. 
 
 
      Casals and Associates, an U.S. contractor, will carry 
out this work.  They are presently implementing the USAID/WB 
Corruption survey. 
 
 
 
 
¶B. Independent Corrupt Practices Commission: $500,000 
 
 
This one-year project will assist the ICPC strengthen its 
investigating and prosecutorial capacities.  The one year-old 
Commission is expanding, has hired staff members, and has 
opened new offices outside Abuja.  Building on an initial 
allotment of $455,000 in FY01 ESF, this project will expand 
technical assistance to the ICPC's investigative and 
prosecutorial arms, with the objective of boosting the 
Commission's capacity to combat high-level corruption. 
Through a study of improved internal procedures and 
regulations and an exchange with officials from successful 
anti-Corruption agencies in Hong Kong and Singapore, this 
project will augment the Commission institutionally.   A 
substantial portion of this project will provide training in 
Nigeria for newly hired ICPC investigators and prosecutors. 
Some ICPC managers will be given advanced training 
opportunities in the United States.   Provision of basic 
investigative equipment - such as digital recording devices 
and computers - will be included. 
 
 
The Department of Justice's Overseas Prosecutorial 
Development and Training (OPDAT) program and the Department 
of Treasury's Office of Technical Assistance (OTA) will 
implement this jointly.  INL's Regional Narcotics and Law 
Enforcement Office (RNLEO) in Nigeria will monitor and report 
on the project's effectiveness. 
 
 
ECONOMIC GROWTH 
Strengthening Economic Policy Making 
 
 
 
 
U.S. Policy Objectives and National Interests 
 
 
Open markets and increased U.S. investment will spur economic 
development and help sustain democratic progress, foster 
expanded trade, and foster a healthier economy which, in 
turn, helps safeguard essential U.S. energy interests in 
Nigeria. Mission goals are to strengthen the institutional 
capacity of the Nigerian Government to plan and implement 
economic reform, repair mismanaged institutions, and promote 
prudent fiscal and monetary policy, with the cooperation of 
the international financial institutions and donor community. 
This will bolster Nigeria's macro-economic situation and 
promote political stability. It will also enhance Nigeria's 
role as a catalyst for growth in the West African sub-region. 
Moreover, neighboring states will be further encouraged 
toward economic reform if an economy as vast as Nigeria's can 
be reshaped and energized. 
 
 
Nigeria is undergoing the slow process of economic and 
structural reforms. Privatization, deregulation, 
diversification away from hydrocarbons and improvement of the 
overall legal and regulatory environment governing foreign 
investment are key issues.  As part of the reform agenda, 
Nigeria is developing a Poverty Reduction Strategy Paper 
(PRSP) in cooperation with the international donor community, 
and as a condition of its engagement with the IMF.  The PRSP 
will enable Nigeria to rationalize resource allocation and 
establish priorities for long-term development.  However, the 
GON lacks the capacity to collect and analyze data needed to 
develop this strategy. 
 
 
Current USAID programs support the national privatization 
program and economic policy coordination through direct aid 
to the Bureau for Public Enterprises and the Economic Policy 
Coordinating Committee, respectively.  USAID has also 
contributed to an assessment of tariff policy and structure. 
 
 
Proposed FY 2002 ESF Program 
Strengthening Economic Management         $1,500,000 
 
 
The Government of Nigeria (GON) needs to establish its broad 
direction for policy, complemented by the development of 
sectoral and multi-sectoral strategies.  The recent expiry of 
the IMF Stand-By Arrangement was partly because no office in 
the GON was tasked with tracking compliance with IMF targets. 
The recently appointed Chief Economic Advisor now has been 
tasked with this responsibility and has requested assistance 
in building a team of well-trained economists able to collect 
and analyze data and write strategy and policy papers on 
reform.  In coordination with other donors, we will assess 
the utility of supplying equipment such as computers, 
software and internet access to the Federal Office of 
Statistics, which falls under the purview of the Chief 
Economic Advisor.  Much of the training can be conducted 
through Nigerian universities and institutes at very 
competitive costs. 
 
 
With more capacity, the Office of the Chief Economic Advisor 
can play a key role in: 
 
 
--Advocating the reduction of barriers that inhibit free and 
fair trade. 
--Arguing for enhanced intellectual property rights 
protection. 
--Urging the growth of the non-hydrocarbon export sector, to 
take advantage of Nigeria's vast mineral and human resources, 
and to tap into the benefits offered by the Africa Growth and 
Opportunity Act (AGOA). 
--Seeking compliance with the IMF's informal program. 
--Developing Nigeria's Poverty Reduction Strategy Paper. 
--Achieving macroeconomic stability, through economic and 
structural reforms, enabling U.S. direct investment. 
--Restructuring the Joint Economic Partnership Committee 
(JEPC) as a mechanism to promote economic reform and 
liberalization of trade. 
 
 
USAID/Nigeria will prepare a competitive solicitation for a 
U.S. contractor or grantee to undertake the activities 
described above.  The successful U.S. contractor/grantee will 
be required to work collaboratively with the GON, state and 
local governments and the private sector. 
Jeter