Cablegate: Meeting with President's Private Secretary Oronsaye

This record is a partial extract of the original cable. The full text of the original cable is not available.

130348Z Feb 04




E.O. 12958: N/A


1. (SBU) SUMMARY: Charge met with the Private Secretary to
the President Steven Oronsaye February 10 on the occasion of
a visit by AF/W Nigeria Desk Officer Dan Epstein.
Highlighting the imminent production of the National Economic
Empowerment and Development Strategy (NEEDS), Oronsaye lauded
President Obasanjo's successes in reform while expressing
reservations over the implementation timetable. He claimed
that the Economic and Financial Crimes Commission (EFCC) was
performing well on corruption, and that the NEEDS program
would produce growth. He said the GON had not capped
gasoline prices, merely set an upper limit, in the highly
political fuel deregulation issue. Oronsaye added that
gasoline was still being subsidized, but not nearly as much,
nor in the same way, as before. END SUMMARY.

2. (SBU) Oronsaye stated that he "does not talk politics,"
but he was open in discussing various economic and reform
issues. When asked if Obasanjo's economic reform efforts
would succeed, Oronsaye said "it will take the grace of God,"
but was possible. He claimed that Obasanjo was beginning to
consult widely with all segments of society and make efforts
to explain the need for reforms in every region of the
country. He criticized the President's naysayers, stating
flatly that "Obasanjo knows it is good for Nigeria." Even
so, he expressed doubts over the pace of reforms. "As an
insider I know the reforms are good, but I wonder if we
really need all of them immediately," he commented.

4. (SBU) The President's secretary also claimed the
anti-corruption campaign is "making progress." The EFCC was
doing well but some obstacles remain: loopholes in the laws;
and the need for judicial reform. "The judiciary needs to
weed out those who don't belong," he said. He also lauded
the efforts of the President's Budget Monitoring and Price
Intelligence Unit (BMPIU) headed by his colleague Dr.
Ezekwesili, claiming that the efforts to make contracting
transparent had saved the GON 50 billion Naira.

5. (SBU) Looking forward, Oronsaye said the National Economic
Empowerment and Development Strategy (NEEDS) document will be
finalized and released "in the next few days." This document
will produce growth, he claimed, but he expressed concern
that the associated state governments' SEEDS might run into
trouble. Some states lacked the capacity to produce the
necessary documents, and did not really understand what a
strategy should be. He said the NEEDS document should be
released in "the next few days."

6. (SBU) Oronsaye thought the ongoing deregulation of fuel
prices controversy stemmed from confusion over reintroducing
the fuel price levy of one and one half Naira per liter. If
the levy had not been mentioned, Oronsaye stated, then the
price increases would have been accepted. "Labour thinks
there is no reason to raise fuel prices for Nigerians," but
the GON had no choice but to stop paying such a huge subsidy.
Moreover, the state-owned refineries were not functioning,
and gasoline prices were too low to encourage private
refineries. In response to a question, Oronsaye claimed that
the GON had not put a cap on fuel prices, but rather the
GON's Petroleum Products Pricing Regulatory Agency (PPPRA)
had published a price band that vendors were not to exceed.
Since the PPPRA band is much closer to the landed cost of
imported gasoline, the GON was saving at least 16 Naira per
liter in subsidies over what it had been paying when
Nigerians were paying only 26 Naira per liter. Oronsaye did
state that, while the amount of subsidy is not known, there
will be in reality some form or another of subsidy as long as
the price of gasoline imports remains higher than what
gasoline sells for in Nigeria, although the subsidy is a tiny
fraction of what it was before.

7. (SBU) Responding to DeskOff's question on what the USG
should do for Nigeria, Oronsaye stated that "the State
Department is not fully aware of what is going on" in
Nigeria. The GON's debt service expenditures on domestic
bonds is nearing its debt service on foreign debt. In his
pitch for debt relief, Oronsaye said it is not fair that the
interest on our debt remains high while the prevailing
worldwide rates are low. The foreign debt was money that
previous regimes had stolen, and it was no longer in Nigeria
to be used for paying off either debt. Making a pitch for
Paris Club relief, he said "Whatever solution is found, the
USG should take the lead if you think we are doing things

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