Identifier
Created
Classification
Origin
03ABUJA123
2003-01-21 16:43:00
CONFIDENTIAL
Embassy Abuja
Cable title:  

NIGERIA: UPDATE FROM NLC PRESIDENT OSHIOMHOLE

Tags:  ELAB ECON EFIN PGOV NI 
pdf how-to read a cable
This record is a partial extract of the original cable. The full text of the original cable is not available.
C O N F I D E N T I A L SECTION 01 OF 03 ABUJA 000123 

SIPDIS


FOR LABATTS: LONDON, PARIS, LAGOS, ACCRA, GENEVA, PRETORIA,
NAMIBIA




E.O. 12598: DECL: 01/16/13
TAGS: ELAB ECON EFIN PGOV NI
SUBJECT: NIGERIA: UPDATE FROM NLC PRESIDENT OSHIOMHOLE


REF: ABUJA 2744


CLASSIFIED BY AMBASSADOR HOWARD F. JETER: REASON 1.5(D).




C O N F I D E N T I A L SECTION 01 OF 03 ABUJA 000123

SIPDIS


FOR LABATTS: LONDON, PARIS, LAGOS, ACCRA, GENEVA, PRETORIA,
NAMIBIA




E.O. 12598: DECL: 01/16/13
TAGS: ELAB ECON EFIN PGOV NI
SUBJECT: NIGERIA: UPDATE FROM NLC PRESIDENT OSHIOMHOLE


REF: ABUJA 2744


CLASSIFIED BY AMBASSADOR HOWARD F. JETER: REASON 1.5(D).





1. (C) SUMMARY: In a late 2002 meeting with Ambassador Jeter,
Nigeria Labour Congress (NLC) President Adams Aliyu
Oshiomhole discussed talks he held with World Bank and IMF
representatives on poverty reduction and worker rights.
Oshiomhole revealed to the Ambassador an ambitious policy
agenda, including a possible fight with the GON over a 12.5%
pay increase for civil servants in 2003. He said that the
NLC has grown leery of striking against fuel cost hikes.
Oshiomhole cited the Administration's inconsistent economic
policies, particularly its failure to address low
productivity, lack of foreign investment, corruption and
private sector inertia as major hurdles to improving the
conditions of working class Nigerians. The NLC President
conceded that privatization is not inherently bad, but the
GON needs to keep parastatals such as the Nigerian National
Petroleum Corporation (NNPC) to protect national and worker
interests. END SUMMARY


--------------
Strange Bedfellows
--------------



2. (U) Ambassador Jeter and Econoff met Nigeria Labour
Congress (NLC) President Adams Aliyu Oshiomhole in late 2002.
Oshiomhole, just returning from an IMF/World Bank-sponsored
meeting with some 90 international labor leaders in
Washington, characterized the meetings as constructive and
enlightening. The IMF/Bank's Poverty Reduction Strategy
Program (PRSP) surprisingly paralleled the NLC agenda, he
stated. Oshiomhole, a strong critic of GON dealings with the
two IFIs, commended their position promoting a living wage
and the freedom of association -- two crucial pillars for
organized labor.



3. (U) Oshiomhole stated the IMF had often been the GON's
scapegoat but the truth was that public spending in Nigeria
had never stimulated economic growth. Nigeria's workers had
many priorities, especially medium to low-income housing,
added Oshiomhole. He complained an average worker was unable

to borrow money to purchase a house, but the GON was doing
little to remedy this deficiency. Regardless of the IMF, the
GON was spending billions of Naira building a National
Stadium in Abuja.


--------------
Difficult to Compete with Asia
--------------



4. (U) Oshiomhole stated that Nigeria's markets are flooded
with Chinese goods and that the international community
should make the playing field level for all nations. During
a visit to China, he observed workers laboring 10 to 12 hour
days, six to seven days a week. Oshiomhole added that the NLC
and Nigerian worker would not accept lower wages, longer
hours, and worse working conditions in order to compete with
China. He then said that poverty would not be reduced unless
the worker received a living wage.


--------------
Nigeria's Corruption
--------------



5. (C) Oshiomhole blamed much of Nigeria's corruption on 16
years of military rule, saying military leaders bloated the
civil service with unmotivated workers. Under current
economic conditions, he stated, "These people cannot live on
their wages, which breeds corruption." The civil service
consumes an estimated 67% of the GON's annual budget, he
said. He then chided the Obasanjo Administration, which set
ambitious economic goals in 1999, but like its military
predecessors, had sapped the economy's potential for growth
through over-reliance on oil exports. The GON failed to
jumpstart the non-oil sector, he chided. The NLC President
said the GON had also failed to address the problems of low
worker productivity, under-investment from abroad, corruption
and private sector inertia. The Ambassador asked whether
former military ruler Ibrahim Babangida was labor friendly.
Oshiomhole responded that Nigerian politicians are devious.
No leader really looked at what would be "good democracy."
He then said that Obasanjo, like Babangida, acknowledged
fraud and corruption but did nothing about it.


--------------
Corruption: No End to Parallel Market
--------------

6. (C) The Ambassador then asked what Oshiomhole thought of
the IMF's Nigeria program, particularly its call for
harmonizing the AFEM (official) and parallel market exchange
rates. Oshiomhole thought the GON would not eliminate the
parallel currency market because many in government were
getting rich by manipulating it. Oshiomhole said Nigerian
ministries often withhold salary payments for months to
enrich themselves by moving money in and out of the parallel
market or simply collecting the interest from the money. By
the time the civil servant gets paid, unscrupulous
businessmen and many GON officials have earned considerable
sums from that worker's salary, he stated.


--------------
Corruption: Too Much Overhead
--------------



7. (C) Government officials, high-ranking civil servants, and
National Assembly Members bill millions of Naira in overhead
to the GON, said Oshiomhole. This scheme too is not
complicated; the official travels to Lagos or New York and
collects thousands of dollars in per diem, charging lavish
hotel rooms and even family travel to the GON. The National
Assembly is especially adept at allocating money to specious
activities, he commented.


--------------
The NLC View on Privatization
--------------



8. (C) Oshiomhole said that the GON should privatize NITEL
and NEPA because they had failed as public utilities.
Nigeria must have functioning telephones and electricity;
otherwise, the cost of doing business is too high for the
country to become competitive and workers will suffer as a
result. However, the NLC had strong reservations about
privatizing NNPC because of the revenue it generates for the
public interest.


--------------
NLC's Evolving Policy Agenda
--------------



9. (U) Oshiomhole listed many NLC advocacy programs: child
labor awareness campaign, worker capacity-building, living
wages and proper working conditions, and a government
transparency campaign. Oshiomhole stated that most in the
GON misunderstood the NLC's goals, seeing the union as an
adversary not as a partner. The NLC President said the union
was largely apolitical, but added that it would support the
Presidential candidate best for workers.



10. (U) The Ambassador asked why the NLC had pushed the GON
for a 25% pay increase in September, but accepted a 12.5%
increase starting January 1, 2003, a move which the
Ambassador commended as rational given Nigeria's economic
situation. Oshiomhole agreed strongly that the deal was good
given the GON's current economic constraints.



11. (C) COMMENT: The GON's economic blueprint for 2003-2007
aims to downsize the civil service and pay its workers
competitive salaries to boost productivity and curb recurrent
expenditures. In late December, President Obasanjo said he
would not grant civil servants a 12.5% pay increase.
Oshiomhole, in turn, has repeatedly stated that workers would
attempt to "make the country ungovernable" (i.e., attempt a
general strike) if the 12.5% pay rise were not implemented in

2003. The GON is in a difficult position; if it grants the
pay raise, Nigeria's finances will be even more confused; if
not, the country might experience sporadic strikes during an
already politically tense time. The NLC's National
Conference comes up in a few weeks and the 12.5% pay increase
is likely to be the centerpiece of its deliberations and
possible calls for a strike action by NLC workers nation-
wide. END COMMENT


--------------
No Fuel Cost Increase Strikes
--------------



12. (U) The Ambassador inquired why the January 2002 fuel
strike had fizzled. Oshiomhole said the NLC had the public's
support and thought the strike was effective. The NLC
judged, however, that it was more important to maintain the
rule of law, instead of extending the strike, he claimed.
Oshiomhole said that the situation was tricky, and the NLC
gave the GON a viable option. The NLC leader said he
suggested that the GON not raise prices but instead let fuel
prices drop, so that people could see a real commitment by
Abuja to the people. He said the NLC would have not have
struck if fuel prices rose slowly instead of the steep
increase the GON proposed. The GON did not accept his deal.



13. (U) NOTE: In January 2002, Oshiomhole had led a two-day
nation-wide strike protesting the GON's hike in fuel prices.
After a Nigerian court ruled that the strike was illegal and
Oshiomhole and several others were briefly arrested, support
for the strike quickly fizzled. Disinterest and general
apathy forced the NLC to call off the strike action, but it
cited "respect for the law" as the reason. The price
increase stood. END NOTE



14. (U) Oshiomhole said the NLC had learned a lesson that in
embarrassing Obasanjo with the strike, the President was less
willing to engage in dialogue. He said that Obasanjo was
increasingly temperamental and lacked trust in the NLC.


--------------
Honored and Humbled
--------------



15. (U) Oshiomhole thanked the Ambassador for the USG's
considerable support for the NLC. Oshiomhole stated that he
was "honored and humbled" by a recent USG-sponsored visit to
the U.S. and especially appreciated meetings with U.S. labor
organizations. He said that the NLC had been an alliance
with the AFL-CIO, and added that the NLC had signed an
agreement with the Carter Center.


-------------- ---
NLC: One of Nigeria's Only National Institutions
-------------- ---



16. (C) COMMENT: The frank, well-spoken and well-traveled
Oshiomhole was confident and on top of his brief during the
meeting. Some of Oshiomhole's arguments, however, seemed
disingenuous; for example, he argued for higher wages while
refusing to acknowledge that Nigerians need to work harder
and longer hours to compete in the international market. He
also bristled at times, especially when asked about his arrest
in January 2002. Despite labor's weaknesses, Oshiomhole draws
considerable influence from the fact that he heads one of the
only truly national institutions that claim membership across
the country, transcending ethnic, regional and religious
divides. If the GON refuses to meet the NLC's pay-raise
demands in 2003, Oshiomhole and the NLC might feel compelled
to call strikes and stoppages. While understandable from the
NLC's perspective, such action could raise political tension
at a time when political activity will already be frenetic in
the lead up to the general elections in April. In the past
Oshiomhole and President Obasanjo have been close, with
frequent informal discussions behind closed doors. Obasanjo
will need Oshiomhole for his current bid for a return to Aso
Rock. END COMMENT
JETER