NIGERIA: POLICE ARREST LABOR OFFICIALS

C O N F I D E N T I A L SECTION 01 OF 02 ABUJA 001787

SIPDIS


E.O. 12958: DECL: 10/15/2008
TAGS: ELAB EPET PGOV PHUM NI
SUBJECT: NIGERIA: POLICE ARREST LABOR OFFICIALS


REF: A. ABUJA 1737 B. LAGOS 2090


Classified by Poloff Russell Hanks for Reasons 1.5 (B) and
(D).



1. (C) Summary: Nigerian Police arrested six Nigeria Labour
Congress (NLC) leaders Monday in an apparent move by the GON
to hinder Labor's efforts to monitor a 34 naira per liter cap
on fuel prices and blunt a possible NLC nationwide strike.
Abuja's Magistrate Court refused bail yesterday for the six
officials and instead charged them with criminal conspiracy.
In response, the NLC called an emergency National Executive
Council meeting this morning in Nassarawa State to formulate
an agenda for tomorrow's scheduled stakeholders meeting in
Abuja between the NLC, 36 State Governors, and Nigerian oil
marketers. With oil importers subject to market prices and
the GON unwilling to revert back to selling directly to
suppliers at a fixed price, the NLC may set a nationwide
strike date following tomorrow's meeting. Tomorrow's meeting
will also test State Governors' willingness to support the
President in an unpopular policy decision or respond to the
NLC's populist stance. End Summary.


GON PLAYS HARDBALL WITH NLC
--------------



2. (C) Federal Capital Territory Police arrested Monday and
continued to detain today Linus Ukamba, NLC's Senior
Assistant General Secretary, and five other labor officials
for picketing a fueling station in Abuja that was charging
motorist more than 34 naira per liter. The NLC, Nigeria's
State Governors, and oil marketers brokered a deal last week
that in theory guaranteed that fueling stations throughout
the country would sell petrol at the official 34 naira price
(reftel A),at least until the end of October. Benson Upah,
a senior NLC official, stated to Econoff that by arresting
and detaining the NLC officials, President Obasanjo clearly
indicated that the GON was "at war" with Labor.


NLC's Credibility at Stake
--------------



3. (C) Upah informed Econoff that he was surprised that the
GON would take such actions with a stakeholders meeting
scheduled tomorrow. According to an Abuja-based AFL-CIO
official, oil marketers informed NLC leadership yesterday
that a Unipetrol shipment had just arrived in Lagos. Oil
marketers said they are now paying 33 naira per liter and,
after additional costs and profit margins, will have to sell
at approximately 45 naira per liter. Press reports indicate
that major oil marketers may instead keep prices in Abuja and
Lagos at slightly below 40 naira for the short-term.



4. (C) The Labor Attach met this afternoon with Denja Yaqub,
NLC's Assistant Secretary for Organisation, who stated that
NLC leadership was worried that Labor would have problems
mobilizing its members quickly for a strike. Nonetheless,
Yaqub said that the NLC would react fast to either mobilize
Labor and threaten to strike or accept a price increase
acceptable to NLC's constituents. Yaqub commented that the
NLC would have a difficult time explaining a price increase
to its constituents after it called off last week's strike
and proclaimed victory by brokering a deal to keep fuel
prices at 34 naira.


Prices Steady But Likely to Climb
--------------



5. (C) Nassarawa State Governor Abdullahi Adamu State
confirmed that the agreement reached last week with Labor
would only last another week or two and said it was based on
PPMC's (the GON's fuel marketer) present stock of fuel.
Abdullahi stated that the issue would be addressed at
tomorrow's stakeholders meeting. During the weekend, Econoff
traveled to Kano and Kaduna where fuel was scarce and selling
from 60 to 100 naira per liter. Poloff returned yesterday
from a trip to the East of Nigeria where fuel was selling for
well over 100 naira per liter. Note: In late September,
President Obasanjo suspended all PPMC contracts for the
importation of fuel for the last quarter of 2003 and first
quarter of 2004, preparing the ground for importation by the
major marketers and successful deregulation of the downstream
sector. End Note.



6. (C) Comment: President Obasanjo clearly stated last week
(reftel B) during a nationally televised speech that any NLC
strike without a 15 day warning required by law would be
illegal. Labor's view, however, is that this is an extension
of the June/July strike action which was merely "suspended"
rather than settled. Monday's arrests may be a precursor to
further arrests of Labor officials over the next several
weeks as the GON attempts to stop a possible NLC strike over
ever increasing fuel prices. Since the NLC has already
informed the public that a deal was reached last week to keep
the price at 34 naira for the next three weeks, labor leaders
are now meeting to discuss how they plan to respond. They
have three options: spin the issue to keep people from
protesting the increase; ask oil marketers to give them more
time; or strike. Even though outside Abuja and Lagos, prices
are double or triple the NLC's 34 naira benchmark, tomorrow's
stakeholders meeting will test the NLC's political muscle and
will. Tomorrow's meeting will also test State Governors'
willingness to support the President in an unpopular policy
decision or respond to the NLC's populist stance. End
Comment.
MEECE