Despite years of growth, Nigeria has also seen a huge increase in the number of people living in poverty. A new report condemns its failure to tackle this inequality, amid warnings that it could lead to civil unrest
At least 86 million people live in extreme poverty in Nigeria. The country’s richest man, Aliko Dangote, is said to earn 8,000 times more each daythan a poor compatriot would spend on their basic needs in a year.
“Income inequality is one of Nigeria’s most serious but least talked about challenges,” says Matthew Page, formerly the US intelligence community’s leading expert on Africa’s biggest economy. “It is this disparity between rich and poor, more than poverty itself, that generates anti-government sentiment and could fuel civil unrest down the road.”
Page’s analysis is backed up by a new global index, produced by Oxfam and Development Finance International, which puts Nigeria outright last in a list of 152 countries ranked by their “commitment to reducing inequality”. Nigeria’s social spending (on health, education and social protection) is, according to the report, “shamefully low” and “reflected in very poor social outcomes for its citizens”.
The billionaire Dangote – also Africa’s richest man – is a 60-year-old Nigerian cement tycoon and philanthropist. His main residence in Lagos is on Banana Island, the country’s most expensive residential estate and a hub for the super-rich.
“People always assume that everyone who works in Banana Island earns a lot of money – but it’s not true,” says David Obi, who has worked among the millionaires and billionaires of this exclusive manmade island (built in the shape of a banana) since 2006.
“The rich do not pay you well but they make you work endlessly,” he says. “I once worked with a rich man where, after I’d finished my work, the family would call me back at one or 2am to come and serve the boss. Yet at the end of the month, they would not pay me. I had to leave because I was owed my salary for several months.”
Obi resides in a part of this gated community where workers are not allowed to stay with their families. “While the rich stay in their mansions, those who work for them will be given a very small space in the boys’ quarters – sometimes two or three workers are made to share one small room.
“The rich don’t want the poor to make progress,” he concludes. “If you are a poor man working for them, they prefer that you stay poor for the rest of your life. They think if they enhance your life and you become rich, you may refuse to work for them again. They want only them and their families to be rich forever.”
A ‘scary level of wealth’
Noel Anago is a 32-year-old chef who cooks for rich clientele at a variety of social events in Lagos. “I am often surprised at the displays of wealth,” he says. “I see very rich businessmen, former presidents, top politicians and governors, many with police escorts and people from the state security service. I am amazed by the expensive dresses, the shoes and the high-quality bags the women carry. They are worth thousands of dollars.”
Between 2004 and 2010, inequality in Nigeria significantly worsened, according to Oxfam, with the upper class benefiting from dubious tax wavers and legislators receiving earnings that were among the highest in the world.
The number of people living in poverty, meanwhile, increased from 69 million in 2004 to 112 million in 2010, despite an average economic growth of more than 7%. In the same period, the number of millionaires in Nigeria increased by 44%.
“The overlap between political and economic power in Nigeria is near total,” says Page. “Politicians often use businesses to siphon money from state coffers, and many business moguls have grown rich on the back of close relationships with top officials, juicy government contracts, or protectionist policies. Nigeria resembles the United States in this way – but with less transparency and minimal independent scrutiny of what are often conflicts of interest.”
In 2014, a report by the former minister of finance, Ngozi Okonjo Iweala, found the Nigerian government had lost approximately 800bn naira (£1.9bn) to tax wavers and concessions to businesses and corporations between 2011 and 2013. The report concluded these wavers led to no measurable benefit for the Nigerian economy.
“Sometimes you are scared by the level of wealth here,” Anago says. “Inequality has an impact on my life: I am working hard just to survive, whereas the rich have everything. They can afford to go to hospitals abroad, while many poor people remain at home with ill-health until the situation gets out of hand. When you don’t have money to even feed, you can’t think of your health – you only think of how to feed the stomach.”
Nigeria has now slipped into its longest recession for more than 25 years, and is grappling with one of the worst humanitarian crises in the world – heightened by Boko Haram’s violent insurgency. More than 4.7 million people are facing food insecurity in the region, according to the UN, while 49% of young people are either unemployed or under-employed in insufficient or part-time work.
Yet according to Nonso Obikili, a Nigerian-based economist, public debate about inequality has decreased in recent years. “In times of economic growth under the last government, there was more of a focus on ‘inclusive growth’ – but even then, nothing significant was done to address it.
“Now there is a recession, the focus of the country is on returning to growth,” he says. “The current government have improved the situation in terms of corruption, but the changes have not been systemic – and that is a problem.”
A high-profile anti-corruption campaign – a key pledge in the election of President Muhammadu Buhari in 2015 – has attempted to stem the country’s historic levels of corruption. Several properties, assets and state funds have since been seized and recovered, and investigations continue.
Talk to both Anago and Obi, however, and they are dubious that much has changed. “Corruption is responsible for inequality,” says Obi. “This country has a lot of resources and if properly managed, there would be no poverty. But people are taking all the country’s resources for themselves and their families.”
According to Anago, “Corruption is the number one factor that brings about the gap between the rich and poor in Nigeria. Many of the rich became extremely rich due to corruption.”
He offers a bleak example of the difference between rich and poor here. “As a poor man, you can’t get justice in Nigeria. For example, when the police arrest the poor, they ask them to bring money to bail themselves. If you don’t have the money, they will detain you.
“It happened recently to one of my cousins: the police arrested him and demanded 45,000 naira (£109). We all had to come together to contribute the money, and even beg the police to reduce the amount. Money matters a lot with the justice system, because money talks when it comes to getting justice in Nigeria.”
Oxfam has been most critical of the country’s political class, finding that, despite adequate resources, poverty alleviation has been hampered by “the ill-use, misappropriation and misallocation of resources”. Small businesses and traders are disproportionately taxed while the rich benefit from arbitrary tax relief, according to the research.
“I am not sure the government is really willing to address the problem of inequality in Nigeria,” Obi says. “If they were, they would have done it a long time ago. When the government itself is paying a very low minimum wage, how can it address the plight of the poor?”
Last year, Nigeria ranked 118th out of 144 countries in the Global Gender Gap report. Economic and educational challenges for poor Nigerians are almost all worse for women: in the poorest section of society, 75% of women do not attend school, and in urban areas 51% do not enrol in education – almost twice the share of men.
“Nigerian women are a negligible and undermined force politically” – with the lowest share of female parliamentarians in sub-Saharan Africa, according to Oxfam.
“The government must build a new political and economic system that works for everyone, and not just a fortunate few,” says Celestine Okwudili Odu, a good governance programme coordinator for Oxfam in Nigeria. “The government can make a start by tackling corruption, investing in vital public services, and protecting the rights of women.”
Back on Banana Island, however, Obi is philosophical about the gulf between rich and poor that he sees so vividly every day. “This place is full of billionaires – but some don’t want anyone to know they are here,” he says.
“I prefer my life to that of the billionaires because I am a free person. When they want to come out, they must do so with the police, whereas I am free; nobody is looking for me. Yes they have money, they can eat, they can do whatever they like – but I have more freedom than they do.”
Some names have been changed at the interviewees’ request.
By Emmanuel Akinwotu and Sam Olukoya. This article first appeared in the Guardian.