Former Nigerian Military President, General Ibrahim Babangida, has justified his government’s spending of the $12.4 billion oil windfall, citing a nationwide culture of “profligacy” and “conspicuous consumption” that undermined the economy’s long-term development.
In his autobiography, ‘A Journey of Service,’ Babangida argued that the “meteoric” revenue from crude oil funded massive infrastructure expansions, but policies like the Indigenisation Decree of 1972 inadvertently provided “windfall gains” for a handful of influential individuals at the expense of non-oil sectors.
Babangida stated, “What I have done is not unusual in this country. Somebody did it before me, but I won’t mention names. We did undertake the construction of various ports and other projects (including bridges).” He further justified his actions, saying, “That money could have gone into the Federation Account. Yes, but whatever foreign exchange we earned, we monetised it, and those we monetised were what the state governments and local governments were getting… And if all we could spend between 1988 and 1994 was $12.4bn, that is very good.”
The former head of state also addressed criticisms of his government’s alleged extra-budgetary spending of oil revenues. In a 1995 interview with TELL Magazine, Babangida defended his government’s creation and management of a Dedicated Account, saying, “People believed that we shared some kind of booty. I didn’t start Ajaokuta, for example, but by the time I took over, $4bn had been sunk in. Having invested so much in it, I thought it would be unfair to allow the whole thing to waste away.”
Babangida’s justification of his government’s actions has sparked controversy, with many criticizing his handling of the oil windfall. The Okigbo Panel report had revealed that $12.4 billion passed through the Dedicated Account, with $12.2 billion allegedly spent on non-regenerative projects deemed non-beneficial to the Nigerian economy.