Nigeria receives approximately $83b per year in foreign aid from donors including the US, Europe, the World Bank, Europe, Japan, and the UN, and certain Gulf countries (AidData). The US aims to contribute approximately $720m in aid in 2015, while European Union aid to Nigeria between 2009 and 2013 totaled approximately $225m per year (Business Day, 2014) (EU External Action). The United States contributed a relatively small amount aid to Nigeria beginning at Nigerian independence in 1960s. Flows during this time were much lower than they have been since democratization. A major US-sponsored aid project in the country during this time was the development of several agricultural schools at Nigeria institutes of higher education (USAID). The US restricted aid the in the early 90s in response to drug trafficking inside Nigeria, donating about $7 million per year during this time (approximately $.06/person) (USAID). In 1999, Nigeria’s first president was elected, and twenty years later, the US president is requesting $720 million in foreign aid to Nigeria (approximately $4/person, adjusted for population growth) (Business Day). US aid to Nigeria thus increased dramatically during the same period that the country became a democracy.
There are various possible explanations for the significant increase in aid from the US to Nigeria over the past twenty years, or since independence. There has been growing recognition by governments and aid agencies of the importance of good governance in effective aid (Moss), and it is possible that agencies and governments have recognized the greater potential effectiveness of donations to a country under democratic rule. On the part of the United States, Other strategic interests that may foster larger aid flows include security concerns associated with the War on Terror and economic concerns at the US begins to import more oil from West Africa. A great deal of aid, approximately 60% of the US contribution, is designated to address the problem of AIDS/HIV. Internal security is also a concern, with aid dollars and advisory support directed especially towards the Niger Delta (EU External Action).
It is interesting to note that although ober $80b in aid makes its way to Nigeria annually, this statistic is much smaller than both foreign direct investment ($117.4b) and remittances ($182.9b). Although such sources of financing cannot be directed by a central planner to address any particular social problem, this type of inflow is viewed by scholars such as Dambisa Moyo to be less damaging to civil society than aid, as well as less vulnerable to corruption. The World Bank notes that Nigeria’s size and decentralized public authority may offer opportunities for corruption, as Nigeria’s 36 states and 774 local governments control half of the government’s total revenues, and have a great deal of discretion in this area (World Bank). A 2013 opinion piece in a UK news outlet argued that aid money is wasted in Nigeria due to the corruption levels, noting Nigeria’s poor 174/215 ranking by Transparency International (Daily Mail, 2013). There are certainly some aspects of development that aid can support, but in such a large country it is challenging to find conclusive evidence about the effectiveness of foreign aid.
Moss, Todd. “Chapter 8: The International Aid System.”
Moyo, Dambisa. Dead Aid.
World Bank: Nigeria Overview
Trading Economics: Nigeria
EU External Action: Nigeria
“Nigeria, a country so corrupt it would be better to burn our aid money” (The Daily Mail, August 2013)
“America wants to send $720m foreign aid to Nigeria in 2015” (Business Day, August 2014)