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UNCLAS SECTION 01 OF 04 ABUJA 001357 
 
SENSITIVE 
SIPDIS 
 
DEPARTMENT PASS TO USTR-AGAMA 
DOE FOR GPERSON, CHAYLOCK 
LABOR FOR SHALEY 
DEPARTMENT PASS TO USAID 
USDA/FAS/OTP FOR MCKENZIE 
USAID/AFR FOR ATWOOD 
 
E.O. 12958: N/A 
TAGS: PGOV ECON ELAB PREL EPET EFIN NI
SUBJECT: NIGERIA:  POL/ECON UPDATES FOR JULY 1-23, 2009 
 
REF:  ABUJA 1272 
ABUJA 1290 
 
ABUJA 00001357  001.4 OF 004 
 
 
¶1. (U) The following is a joint Embassy Abuja, ConGen Lagos 
compilation of July 1-23, 2009 political/economic highlights, which 
did not feature in our other reporting, covering: 
 
--Political News 
--Economic News 
--Narcotics News 
--Delta Incidents 
 
POLITICAL NEWS 
-------------- 
 
¶1. (U) FOREIGN MINISTER ALMOST LAUGHED OFF STAGE:  ThisDay reported 
on July 17 that Minister of Foreign Affairs Ojo Maduekwe announced 
to hundreds of guests at the Lagos Civic Center that President Obama 
"held him by the shoulder and told him, 'I want to visit your 
country very soon.'"  The report also said that before he could even 
finish his sentence, the audience erupted in laughter for over two 
full minutes.  The report added that Maduekwe, visibly embarrassed 
by the laughter, stood looking helpless watching the scene, then 
attributed the negative response to President Obama's speech, which 
he said "debased Nigeria's self esteem as a people."  Maduekwe then 
added, "We are destined to laugh last... Nigerians know those who 
are their true leaders, and at the end of the day the Yar'Adua 
administration will definitely succeed." 
 
¶2. (U) NIGERIAN SENATE OPPOSES ANOTHER INEC BILL:  On July 21, 
ThisDay reported that the Nigerian Senate rejected the second, of a 
total six, electoral reform related bills introduced by President 
Yar'Adua. The Upper House had in May, this year, thrown out the 
Political Parties Registration and Regulation Commission (PPRRC) 
Bill, which was seeking to take over the registration and regulatory 
functions of INEC as constitutionally mandated. 
 
¶3. (U) INEC RETREAT TO WORK OUT KINKS:  ThisDay reported on July 23 
that the Independent National Electoral Commission (INEC) will hold 
a strategic retreat of top management and technical staff from 
August 3 to 4, 2009, reportedly in Kaduna.  Lagos State Resident 
Electoral Commissioner (REC), Mr. Moses Ogbe, told the local 
reporters that many of the problems that marred past elections would 
be addressed at the retreat "so that the 2011 exercise will mark an 
improvement on the past efforts."   He also added that "the number 
of re-run elections held so far was an opportunity to learn from 
past mistakes.  Speaking on the call from many groups and 
individuals for the removal of the INEC Chairman, Professor Maurice 
Iwu, he said, "Let me say that Professor Iwu's tenure has not 
expired.  Professor Iwu has also made it clear that if the 
stakeholders or the public say that he is part of the problem, then 
he should also be part of the solution. Like I have said whatever 
mistake that were made in the past we are also trying to correct 
them." 
 
¶4. (U) NATIONAL ASSEMBLY WANTS CREATION OF NEW STATES:  Leadership 
Nigeria reported on July 21 that Members of the National Assembly 
vowed that there would be no constitutional amendment on electoral 
reform without creation of additional states.  Senator Ayogu Eze, 
(Enugu State North) stated that "the issue of a constitutional 
amendment was key to democracy and that only state creation would 
provide the dividends of democracy.  Our people are interested in 
state creation; our people are of the view that state creation is 
very important in a democratic dispensation."  Eze also insisted 
that creation of states should come before the 2011 general 
elections, stating, "we know it is feasible and we equally know that 
it would unite the country." 
 
¶5. (U) TIME IS RUNNING OUT FOR ELECTORAL REFORMS:  The Daily Trust 
reported on July 21 that Electoral Reform Committee (ERC) Chairman 
and former Chief Justice, Muhammed Lawal Uwais, warned that with 
only 22 months to go before the tenure of current political office 
holders runs out, time is running out for the enactment and 
 
ABUJA 00001357  002.3 OF 004 
 
 
implementation of approved aspects of the ERC report.  In his 
remarks to participants at the National Conference on Consensus 
Building for Electoral Reform, jointly organized by International 
Republican Institute (IRI), National Democratic Institute (NDI) and 
Centre for Democracy and Development (CDD), Uwais blamed President 
Umaru Yar'adua and the National Assembly for the delay in the 
implementation of the ERC's recommendations, claiming that "he may 
not be interested in the electoral reform effort."  He added that 
the "Committee is convinced that the recommendations contained in 
the ERC report are necessary and sufficient to improve the quality 
of our election, and therefore should be considered urgent by 
President Yar'Adua, the National Assembly, Governors, and State 
Assemblies to affect the Constitutional, statutory, administrative 
and institutional changes required to achieve the desired effect." 
 
¶6. (U) INEC REGISTERS FOUR NEW POLITICAL PARTIES:  On July 20, the 
Independent National Electoral Commission (INEC) registered four new 
political parties, bringing the total number of political parties to 
54, all of which are to be registered for participation in electoral 
contests in Nigeria.  The new parties are the United National Party 
for Development (UNDP); National Movement of Progress Party (NMPP), 
the Kowa Party (KP), and People for Democratic Change (PDC).  In a 
statement released by INEC's Acting Director for Public Affairs on 
July 21 to ThisDay, Mr. Umenger Emmanuel, INEC approved the 
registration of the four Political Parties after they had satisfied 
all requirements specified in Sector 222 of the Constitution of the 
Federal Republic of Nigeria and the Electoral Act 2006.  Emmanuel 
added that "INEC is considering applications from political 
associations that have also applied for registration." 
 
¶7. (U) BAUCHI STATE DEP GOVERNOR HOUSE TO BE RAZED:  Bauchi State 
Deputy Governor Garba Gadi has encountered additional difficulties. 
On July 8 the Daily Trust reported that the Bauchi State government 
plans to demolish a two-bedroom flat owned by Gadi.  News of the 
planned demolition was presented to Gadi just two weeks after he was 
served with an impeachment notice alleging financial misconduct (ref 
A). 
 
¶8. (U) RIVERS STATE GOVERNOR BANS EFCC AND AG:  According to ThisDay 
on July 20, Rivers State Governor, Rotimi Chibuike Amaechi, slammed 
Nigeria's Attorney General Michael Aondoakaa and Economic and 
Financial Crimes Commission Chair Farida Waziri for "not abiding by 
the rule of law."  He also warned that "neither Aondoakaa nor Waziri 
would be allowed into Rivers State until the Federal High Court 
recognize that the power to investigate the state's accounts rests 
with the State house of Assembly, not the Federal Government."  At 
the same time, Amaechi also condemned the ceding of over 80 oil 
wells belonging to Rivers State to Akwa Ibom, and pointed out that 
he will not only challenge the ceding of the wells in court but the 
entire 186 wells involved.  He claimed that the Niger Delta region 
was "always suffering from neglect and unfair treatment by the 
federal government" and that he had to "resort to use of State 
resources to repair the roads which belong to the federal 
government." 
 
NARCOTICS NEWS 
-------------- 
 
¶9. (U) UK AND GON SIGN MOU ON ANTI-NARCOTICS OPERATIONS:  On July 
21, ThisDay reported that the U.K. signed a Memorandum of 
Understanding (MOU) with the GON to fight trafficking in hard drugs, 
just as the GON sacked 70 officials of the National Drug Law 
Enforcement Agency (NDLEA) for allegedly compromising their duties. 
The MOU will allow the U.K. to reposition NDLEA operations with 
better technical expertise.  Acting British High Commissioner to 
Nigeria, Peter West, described the joint cooperation as "a welcome 
development that must be promoted globally."  He added that "a study 
carried out in 2006 by Britain and other stakeholders revealed that 
West Africa was the most vulnerable transit region for Colombian 
drug traffickers." 
 
ECONOMIC NEWS 
------------- 
 
ABUJA 00001357  003 OF 004 
 
 
 
¶10. (SBU) CBN LOWERS LENDING RATE, ANNOUNCES BANK CONSOLIDATION 
PROPOSAL:  Similar to our reporting from Ambassador's July 8 and 13 
meeting with the new Central Bank of Nigeria (CBN) Governor (ref B), 
that it would be implementing a new inter-bank rate and looking at 
performance of banks, the press reported on July 23 that the Central 
Bank of Nigeria (CBN) lowered its inter-bank lending rate from 25 to 
13 percent.  The press also cited the CBN proposal for a new round 
of bank consolidations to begin early in 2010.  In the July 7 
meeting with the Ambassador, the CBN Governor had stated that these 
measures were under consideration (ref B).  The announcement 
indicates that the CBN Governor is implementing his proposals.  The 
objective of the first measure is "to inject liquidity into the 
market and promote sustainable growth and development."  Until July 
17, banks lent to each other at the 25 percent interest rate.  Since 
then, the inter-bank lending rate has fallen to 13 percent. CBN's 
aim with the proposed bank consolidation is to reduce the number of 
banks from 24 to around 15.  In Ambassador's previous conversations 
with the CBN Governor, he clearly stated his preference for further 
consolidations, but only market driven consolidations.  He also 
stated that he would support and encourage mergers and acquisitions 
among banks, both domestic and foreign, and provide any assistance 
to those weak banks that choose to merge with other strong banks. 
The press reported that the outcome of the banks' audits, currently 
underway, would determine whether the new round of consolidations 
would be CBN or market driven.  Post will monitor the situation and 
report septel. 
 
¶11. (SBU) SENATE OKAYS NATIONAL CLIMATE CHANGE COMMISSION: According 
to press reports on July 22, 2009, the Nigerian Senate passed a bill 
for the establishment of a National Climate Change Commission.  The 
House of Representatives now has to pass the legislation before the 
president can sign it into law.  The bill stipulates that the 
Commission will receive funding from the Ecological Fund as well as 
revenues from carbon financing.  The Commission is expected to 
tackle key issues of desert encroachment, deforestation and ocean 
surge and other environmental issues that arise from global climate 
change.  In addition, the Commission will coordinate and formulate 
Nigeria's response to issues of climate change and play a 
significant role environmental-related crisis in the Niger Delta. 
 
¶12. (U) NEMA WARNS OF NATURAL DISASTER:  On July 11, Director 
General of National Emergency Management Association (NEMA) Mohammed 
Audu- Bida disclosed that Nigeria is prone to natural disasters that 
could have a negative impact on social and economic development if 
adequate measures are not taken.  Audu-Bida pointed out that 
southern parts of Nigeria are under threat of flooding and 
deforestation, and emphasized that climate change is causing rising 
sea levels, coastal and marine erosion, and flooding, particularly 
in South- South and South-West. 
 
¶13. (U) NIGERIA-US TRADE HITS $42.2 BILLION:  On July 13, during a 
seminar on consumer protection organised by the United States 
Federal Trade Commission and Nigerian Consumer Protection Council, 
Permanent Secretary of the Ministry of Commerce and Industry,  Linus 
Awute, disclosed that total trade volume between Nigeria and the 
United States was $42.2 billion in 2008.  Awute highlighted that the 
U.S. exports to Nigeria include vehicles, machinery, IT software, 
electronic gadgets, toys, wheat, and others.  He added that Nigerian 
exports to the U.S. include petroleum, organic chemicals, cocoa and 
rubber. 
 
¶14. (U) GON APPOINTED NEW HEAD OF NSEC: On July 17, the Arunma Oteh 
was appointed as the new head of the Securities and Exchange 
Commission (NSEC).  Oteh was previously the Vice-President of the 
Corporate Services at the African Development Bank Group (AfDB). 
 
¶15. (U) FIRST BANK TO OPERATE IN CHINA:  Press reported on July 5 
that First Bank of Nigeria was granted approval from the China 
Banking Regulatory Commission to open an office in Beijing.  Group 
Managing Director and Chief Executive Officer of First Bank Bisi 
Onasanya stated that the First Bank's expansion highlights the 
steady rise of the Nigeria's banks in the international financial 
 
ABUJA 00001357  004.3 OF 004 
 
 
market. 
 
¶16. (SBU) SECURITY EXPANDING AT ABUJA INTERNATIONAL AIRPORT:  The 
Transportation Security Administration (TSA), in partnership with 
the GON, conducted a Man Portable Air Defense System (MANPADS) 
assessment for the Nnamdi Azikiwe International Airport in Abuja 
from July 13 - 17. A two person Federal Air Marshall (FAM) Team led 
the assessment, accompanied by Embassy Air Attach and approximately 
20 representatives from Nigeria's Airport Security, State Security 
Service (SSS), the Nigerian Police, Air Force, Office of the 
National Security Advisor, and Customs.  The assessment concluded 
with a training session on MANPADS including video of actual 
incidents.  TSA will prepare a written report on their findings 
within 60 days. 
 
DELTA INCIDENTS 
--------------- 
 
¶17. (U) SIX ATTACKS IN LAST TWO WEEKS:  Militants continued their 
intensified campaign against oil installations with six attacks in 
the last two weeks, including one spectacular attack under the nose 
of the Nigerian Navy in Lagos. Although the Movement for the 
Emancipation of the Niger Delta (MEND) took credit for all attacks, 
there are strong indications that the militants behind the most 
recent attacks are only very loosely tied to MEND and certainly not 
controlled by the alleged leader of MEND, Henry Okah, who was 
released from prison under the GON's amnesty terms on July 13. 
 
¶18. (U) DETAILS OF RECENT ATTACKS:  According to press accounts, six 
expat crewmembers (no Americans) were removed from a chemical tanker 
operating off Escravos in Delta State on July 5. The press also 
reported that on the same day, an attack was made against a Shell 
oil well in Rivers State and a Chevron manifold in Delta State. On 
July 8, two further attacks were made on facilities in Bayelsa 
State, affecting facilities owned by Shell and Agip according to the 
media. The attack in Lagos, the first such attack outside the Niger 
Delta, occurred on July 12. 
 
¶19. (U) TOTAL ATTACKS:  This brings to date the number of attacks 
against oil facilities since the start of the military Joint Task 
Force (JTF) offense on May 15 to over 20. An estimated 589,000b/d 
are now shut in, according to a report presented by the Group 
Managing Director of the Nigerian National Petroleum Corporation 
(NNPC) Mr. Mohammed S. Barkindo to the oil and Gas workers in Abuja 
on July 4. 
 
SANDERS