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Overriding Nigeria’s development impasse: The enclave paradigm – Part 2


The United States had particularly paid strategic attention to Nigeria. In the course of the endless transition of the Babangida regime, with some measure of exactitude predicted its outcome: “Prospects for a transition to civilian rule and democratization are slim. . . . The repressive apparatus of the state security service . . . will be difficult for any future civilian government to control. . . .The country is becoming increasingly ungovernable. . . . Ethnic and regional splits are deepening, a situation made worse by an increase in the number of states from 19 to 30 and a doubling in the number of local governing authorities; religious cleavages are more serious; Muslim fundamentalism and evangelical Christian militancy are on the rise; and northern Muslim anxiety over southern [Christian] control of the economy is intense . . . the will to keep Nigeria together is now very weak”.

In 2005, in yet another intelligence report, the US predicted the possible dissolution of the Nigerian state by 2014. It noted that while “Nigeria’s leaders are locked in bad marriage that all dislike but dare not leave, there are possibilities that could disrupt the equilibrium in Abuja”. While the standpatters celebrated the “failure of that prediction” in 2014, the fact of a bad matrimony cannot be controverter and the possibility of a forceful divorce always looms large in the polity despite the intervening politics of brinkmanship.


In the context of the crisis of state in the 1960s, Awolowo had confidence that the Nigerian problems were surmountable. According to him, “Let us be honest with ourselves and confess our failings and limitations. What we lack very much is a sufficient number of powerful leaders with caliber, character, and qualities, requisite for uniting and keeping happily together the diverse elements in our infant nation, not for courageous and effective assault on the multitudinous and intractable-looking problems that beset us” The country is 59 years old; the adult child refuses to walk. May be it is still on a learning curve. In today’s global context, there are no waiting games, if you are left behind, you remain so. But painfully, the extant governing class appears to be consolidating the impasse in ways that would engender unreason as the solution. Ironically, while the call for restructuring, in other words, a change in our old way of doing things is gaining salience, it is being upended by counterproductive policies from Abuja.

The incumbent administration is mainstreaming its preferences and simultaneously altering the demographics by backing the land grab of itinerant Fulani in a country of indigenous people. Besides, it is currently compacting a bill to empower the central government’s control of water ways and creeks in the country, an issue Obasanjo administration had resolved in favour of the littoral states. Curiously, not too long the National Financial Intelligence Unit (NFIU), a brainchild of the Bretton Woods Institutions (BWIs) to curb global terrorism is being engineered to reify the skewed 774 local governments in the country into an autonomous tier of the Nigerian federation.


These measures, statist in essence, only reinforce the contradictions of the state system and the divorce impulses in the polity. In the African context, if a marriage is not working, the couple has two options: divorce or cohabitation under conditions of misery. In the Nigerian impasse, either of the options is possible. The latter option is presently the state of the union. The important question for us is: can the miserable condition be mediated? This is my pre-occupation in the next section of this conversation. Dan Agbese provides a useful preface. In his words, “Every problem has a solution but not every solution has a problem.

But Nigerians have come to understand in the critical business of moving the nation forward, the first patriotic order of business is to find solutions to the lingering problems and then find solutions to the anticipated problems. This is known as forward planning”. In the views of Jonathan H. Conning and James A. Robinson, an enclave economy is defined as an economic system in which an export based industry dominated by international or non-local capital extracts resources or products from another country. As a subset of the dependency theory it approximates the dependency relations of capital especially between the advanced economy and the peripheral ones in the global south.

The model denotes multinational corporations with roots in the metropoles that invests in the production of an export product meant for their home country and cost burdens are usually cut due to neo-colonial control of the host country. Capital flight characterizes their operation and could result in loss of income for the host countries in ways that reduce the latter’s capacity for development. Besides, gross human rights violation does take place through exploitative labour practices and repression of the local communities.


The Niger-Delta explicates the dynamics of enclave economy typified by the oil industry. The enclave nature of the oil industry in Nigeria and elsewhere has spawned the debate about ‘oil curse’. As Duncan Clarke has noted while summarizing the views of Macartan Humphreys, Jeffrey Sachs, Joseph Stiglitz and George Soros, “…the oil industry forms an “enclave”: it has few domestic linkages, may often be produced without large segments of domestic labour, and relies on foreign companies with unequal expertise and technologies (the state lacking capacity). Oil activity leads to rent-seeking, stimulates Dutch Disease (exchange-rate appreciation) and economic distortions in non-resource development, induces foreign import spending patterns, leads to income/earnings volatility with boom/bust cycles, and encouragement of government to live of their (hydrocarbon) capital rather than income from productive capacity. Moreover, it may be associated with insufficient investment in human capital, might generate “spoliation” (theft), and may create weakened and unaccountable states as people become untaxed, so undemocratic practices can abound. It also threatens democracy as the political elites trade power for tax rights and prefer to acquire the tools of coercion, while oil (in Africa) leads to grievances in producer regions, and may provoke military challenges and coups in the struggle for power and in the end control over oil. It is a damning list of liabilities and consequences”.

The exploitative depth of enclave economies is debatable in the literature. However, it is to be noted that the term enclave economy has other connotations in the literature. Also, it refers to ethnically defined communities, usually from the developing countries who are embedded in the advanced countries in somewhat differentiated form working under different immigration regimes. Ivan Light et al point to the terms “ethnic economy” and “ethnic enclave economy” which marks out an immigrant or minority business and employment sector that coexists with the general economy. My notion of the enclave paradigm diverges from the prevailing usage in the literature.

I use it in terms of what might be called self-imposed autonomy of production where there is prevalence of centralized autocracy that is counterproductive to the harnessing of local resources for local development. It refers to escape from the institutional and organizational strictures imposed by the autocracy which consequences undermine development, creates stasis and reproduces conditions of poverty.
Akhaine, a Professor of Political Science, Lagos State University delivered this lecture at the instance of Oriwu Club of Ikorodu, Lagos.


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