From the TUC

Nigeria needs infrastructure investment, not privatisation and price rises

15 Jun 2011, by in International

The Nigerian Labour Congress (NLC) has a long and honourable history – including resisting harassment and initimidation when the army was in charge of the government. But one of the main reasons they are respected by both government and the rest of civil society in Nigeria is the part they have played in resisting petrol price rises. Now they fear that the government is gearing up again to try to increase the price of oil for Nigeria’s working poor, and the NLC will once again resist them. Oil is a major issue in people’s lives, because it affects almost every aspect of the economy. If oil prices rise in the morning, bread prices are up by the end of the afternoon.

Nigeria faces a series of economic problems caused by years of corruption and neglect. Despite being a major oil producer, Nigeria imports petrol because it cannot refine enough in its outdated refineries. The elctricity generating infrastructure is similarly archaic and unmaintained, so Nigeria functions on oil for factory generators and trucks rather than high-speed trains. The two main cities, Abuja and Lagos, are nine or ten hours drive from each other, but a proper high speed rail link could cut journey times to two or three hours. Instead, people fly, at great cost both to the economy and the climate.

In response, successive governments has seen oil price rises and privatisation of the electricity industry as the only way to get the system working again, but the NLC points out that rising prices at the pumps will hit ordinary people’s living standards, and privatisation will only mean that the people responsible for letting the industry decay will take it over for a fat profit. Instead, the NLC is calling for a system of licences that would lever in external expertise and capital needed to modernise refining and electricity generation, but leave the industry in the hands of the Nigerians. The NLC wants modernisation before price rises, which would boost the economy and help minimise the impact of the eventual increases in prices.