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Obama ties debt relief to Taylor handover


- Rodney D. Sieh

(Wednesday, June 22, 2005)

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"I strongly believe that Nigeria is a worthy candidate for debt relief and a key U.S. partner in West Africa. When Charles Taylor is turned over, there is no doubt in my mind that I will be a forceful advocate for debt relief for Nigeria," said the U.S. Senator.


Senator from Illinois pledges to become a forceful advocate for Nigeria's debt relief, but says the West African nation must first turn over the former Liberian dictator--an indicted war criminal who has the blood of thousands on his hands and threatens, once again, to destabilize the region--to the Special Court. United States Senator Barack Obama, D-Illinois has suggested that any debt relief for Nigeria must be conditional provided the West African giant succumbs to international pressure and turn over former Liberian dictator Charles Taylor to the Special Court in Sierra Leone. Obama, who was born in Hawaii, but is the son of a Kenyan, made the assertions on Wednesday (a copy of the transcript of the Senate session obtained by the Observer) on the floor of the U.S. Senate in a frank exchange with fellow Senator Patrick Leahy, D-Vermont, the ranking member of the Appropriations Subcommittee on State, Foreign Operations. When the world's wealthiest countries clinched a deal on Saturday to wipe out more than $40 billion of impoverished nations' debts in a drive to free Africa from hunger and disease, Nigeria was one of the few countries that was noticeably absent from the list to win an automatic debt relief.

Eighteen Highly Indebted Poor Countries -- Benin, Bolivia, Burkina Faso, Ethiopia, Ghana, Guyana, Honduras, Madagascar, Mali, Mauritania, Mozambique, Nicaragua, Niger, Rwanda, Senegal, Tanzania, Uganda and Zambia -- will benefit from the debt writeoff. During his recent visit to Washington to meet President Bush, it was widely reported that Nigerian president Olesegun Obasanjo and U.S. President George Bush discussed Nigeria's debt problems. However it appears that Obasanjo was unwilling to part with Taylor in exchange for debt relief for his country. World Bank President Paul Wolfowitz, on his first foreign trip as head of the World Bank was in Nigeria this week, provided a partial explanation as to why Nigeria was left off the debt-relief list.

According to the Associated Press, Wolfowitz said Nigeria was not excluded from the G8 deal. "Nigeria was not excluded from the consideration of the G8 finance ministers. What you may not know is that in their private discussion, they spoke very positively about what you have started here and spoke very strongly about how important Nigeria is for the rest of Africa," Wolfowitz said. In recent times, Nigeria has embarked on economic and political reforms and has recently launched a crackdown on corruption, prosecuting top officials who allegedly stole money or engaged in corrupt acts. But many see Wolfowitz's gesture as an attempt to calm a muddy water Nigeria has already made for itself. Nigeria's foreign debt is officially put at 35 billion dollars and Obasanjo has in the past years led an African campaign for debt relief for countries in the continent in general, and Nigeria in particular.

However, Obama said debt relief from the United States is not automatic and in the past, debt relief has come with conditions, including making progress in fighting corruption and on economic reform, to ensure that this relief achieves the maximum results. In the case of Nigeria, Obama said, "this means turning over Charles Taylor--an indicted war criminal who has the blood of thousands on his hands and threatens, once again, to destabilize the region--to the Special Court. "I strongly believe that Nigeria is a worthy candidate for debt relief and a key U.S. partner in West Africa. When Charles Taylor is turned over, there is no doubt in my mind that I will be a forceful advocate for debt relief for Nigeria," said the U.S. Senator. While heaping praise on Nigeria for its leadership on other issues, especially their efforts to lead the African Union force in Darfur, Obama said he wants nothing more than to see the Taylor issue "successfully resolved so we can focus our attention on other important issues with the Nigerians." "I would also reiterate what the Senator said about the waiver authority contained in section 585. The President can waive these restrictions, including those pertaining to Nigerian debt relief, by formulating a plan to get Mr. Taylor to the Court."

Nigeria's debt

Three percent of Nigeria's official external debt is owned to the United States -- a very small percentage of its (Nigeria's) overall exposure. All told Nigeria has about $33,000 million in loans due, with $25,000 million of the amount owed to donor countries of the so-called Paris Club, a forum where developing countries meet with donor countries, including the U.S., to renegotiate the terms of their government to government debts. Nigerian debt relief and reduction has also been pursued among the G-7 group and the G-7 financial ministries deputy groups on multiple occasions.

One of the country's chief supporter is Sen. Maxine Waters, D-Calif. who favors debt forgiveness, speculated that the rescheduling option suggested by the treasury officials will prove to be unworkable. The California lawmaker once asserted that President Obasanjo "will not be able to sustain democracy and his presidency if he does not get some immediate help and (debt) relief. In 2003, The Paris Club agreed to reschedule $23.4 billion of Nigeria's foreign debt, which is almost four-fifths of its outstanding external debt.

A History of loans, debts

Recorded documents suggests that the bulk of Nigeria's debts are reportedly from new loans which were incurred in the period 1978 during the first Obasanjo regime through the Shagari regime (when most of it was really incurred in an outrageous manner) to the Buhari regimethat ended in December 1983. In fact the first two so-called "jumbo loans" totaling $1.75 billion dollars were incurred in 1978. During this 5-year period, of the new 90 or so new loans, 22 were under Obasanjo, 59 under Shagari and 8 under Buhari. The bulk of total debts (new plus arrears plus particularly the effects of rescheduling) was incurred during the Structural Adjustment Program SAP years (July 1986 - December 1992) of General Babangida (who took over from Buhari August 27, 1985 and retained his head-of-state position till August 27, 1993)

For his part, Sen. Leahy, reminded his peers about an often overlooked, provision of law that governs the relationship of the United States with nations that harbor individuals who have been indicted by the Special Court for Sierra Leone or the International Criminal Tribunal for Rwanda.

"This provision, section 585 of the Foreign Operations Appropriations Act, which was signed into law by President Bush in January 2004 and reauthorized about a year later, makes it clear that the Unites States stands for the rule of law in Africa, " said Leahy.

Obama voiced his strong support for the efforts of the special court in Sierra Leone. "I would also like to add my support for the efforts of the Special Court for Sierra Leone to bring to justice some of the worst war criminals of the 20th century. While the Special Court has not been perfect, there is no question that the Court is doing vitally important work of promoting peace and reconciliation, increasing accountability, and strengthening the rule of law throughout West Africa. I also want to discuss a related issue--the case of Charles Taylor. I know the Senator from Vermont has been working for years on this issue, said Obama.

Obama on Nigeria

"No nation should be permitted to willfully ignore an indictment issued by the special court. Moreover, there are credible reports that Mr. Taylor has broken the terms of his exile, is a threat to the Liberian peace process, and continues to meddle in the internal affairs of Liberia--just a few months before the Liberian elections. "

Obama said Taylor is an indicted war criminal, and he needs to be transferred to the Special Court to stand trial as soon as possible. Obama accused Nigeria of allowing to live in exile, within its borders, with the support of the international community, including the United States, since August 2003. "While we owe Nigeria a debt of gratitude for helping prevent further bloodshed in Liberia, it is time for Mr. Taylor to be transferred to the Special Court, said Obama, adding that "no nation should be permitted to willfully ignore an indictment issued by this tribunal." Moreover, Obama asserted, there are credible reports that Mr. Taylor has broken the terms of his exile, is a threat to the Liberian peace process, and continues to meddle in the internal affairs of Liberia--just a few months before the Liberian elections.

Leahy said Taylor's actions are a breach of his promises to Nigerian President Obasanjo and said that he believes that if Nigeria does not hand over Charles Taylor for trial, it could constitute a threat to Liberian peace, justice in Sierra Leone, and the rule of law throughout West Africa.

"This is why the provision of law that I mentioned earlier is so important. It is the law of the United States that there shall be no assistance to the central government--including debt relief--for countries harboring fugitives from the Special Court for Sierra Leone, " said Leahy.

'Not in Africa's interest'

Leahy asserted that there is strong bipartisan support in the U.S. Congress to reauthorize this provision in fiscal year 2006, which means that unless President Bush issues a waiver, Nigeria will not be eligible for U.S. debt relief or military assistance, or any other assistance to the central government, until it sends Charles Taylor to the Special Court for trial.

"I would point out that President Bush can exercise the waiver authority in the law by simply submitting a plan in writing on how the Administration will get Mr. Taylor to the Special Court to stand trial, Leahy said. "Mr. President, it is not in the interests of the people of West Africa, including Nigeria, or the United States, to continue to shelter Charles Taylor from justice," said Leahy.

Leahy said as a strong supporter of debt relief, he believes that there is a strong case to be made that Nigeria's debt should be forgiven--but not until President Obasanjo again demonstrates leadership and hands over Charles Taylor for trial. "At that point, I will strongly support debt relief for Nigeria and actively lobby the administration and Congress to make it a reality."

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