From Babangida to Obasanjo: The State, rent seeking behaviour and the realities of privatization in Nigeria

Abstract

In line with the orthodox thinking regarding economy development, privatisation of public enterprises hitherto have
become critical component of Nigeria’s economic reform programmes since the last decade and a half. This paper argues
that privatisation a much touted program from the regime of Ibrahim Babangida (1985 to 1993) to the second coming of
Olusegun Obasanjo (1999 to 2007) did not act as the much expected economic elixir but rather became as a process of
transferring public wealth into the hands of opportunistic political and economic elites. In this case, while the popular
expectation was initially that privatisation would usher in economic growth, provide jobs and raise general quality of life,
the selfish pursuit of the elite class invariably undermine these expectations. Privatisation in Nigeria starting from then till
now can be likened to ‘economic terrorism’ on the population by the elites. Moreover, given the nature of Nigeria’s political
elites as rent-seeking ‘prebendalists’, it may be better for the privatisation exercise to borrow a leaf from the Chinese
example of ‘patriotic economics’ which recognises that there is no long term benefit in denationalising strategic sectors of
the economy.