Theories of Corruption “Public Choice-Extractive Theory” as Alternative for Combating Corruption

Theories of Corruption “Public Choice-Extractive Theory” as Alternative for Combating Corruption

Olusola Joshua Olujobi (Covenant University, Ota, Nigeria) and Oluwatosin Michael Olujobi (University of Lagos, Lagos, Nigeria)
DOI: 10.4018/IJESGT.2020070105
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Corruption is a recurrent decimal in Nigeria's upstream petroleum sector due to weak enforcement of anti-corruption and transparency laws. This sector is considered corrupt due to the rampant mismanagement of petroleum resources. The article analyses rent-seeking, public choice and extractive theories of corruption among others due to their impacts in combating corruption. It also queries other anti-corruption models that are relevant to this study to promote transparency and to strengthen national anti-corruption laws for combating corruption in the Nigeria's upstream petroleum sector. The study is a doctrinal legal research that adopts a point-by-point comparative approach with library research method. The study proposed a hybrid theory of corruption titled “Public Choice-Extractive Theory of Corruption” as an alternative perspective that will effectively combat corruption in the sector. In conclusion, the study finds that corruption strives on the weak enforcement of anti-corruption laws and lack of political will in providing effective regulatory intervention. The study recommends among other reforms, soft law approach and strict enforcement of anti-corruption laws for transparency in the upstream petroleum sector in Nigeria.
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1. Introduction

The attention of legal scholars have been drawn to the weak regulatory governance in Nigeria’s upstream petroleum sector (Olujobi, 2017). The weak legal framework has had a detrimental consequence on the economic growth of the country (Global Witness, 2017). Corruption increases transaction costs in the sector, thereby undermining the judicious and proper management of petroleum resources for the development of the country.

One of the challenges that give room for corruption in the oil sector is the absence of a political will to combat corruption by the Federal Government of Nigeria. This legal deficiency has led to failure in transparency and good governance despite the various anti-corruption audit reports that have uncovered corruption in the sector. The lack of commitment to combat corrupt practices has led to the reluctance of some international anti-corruption institutions from providing their full supports on the repatriation of proceeds of corruption to Nigeria. These anti-corruption audit reports have not been used to gain useful insights to reform the sector. Meanwhile, some government officials are allegedly benefiting from the corrupt practices thereby resisting all transparency measures. This has led to loss of oil revenues to the government from the sector.

The fundamental problems with the anti-corruption legal framework are weak enforcement and the ambiguity of laws. Ambiguous laws make it difficult to understand its objectives, leading to loss of corruption cases in courts (Bello, 2014). This is evident in section 404(1)(a) of the Criminal Code that criminalises the demand of property. Similarly, many anti-corruption laws fail to concurrently combat corruption in both the private and public sectors. As majority of the upstream petroleum operators are private companies thereby weakening the enforcement of anti-corruption laws and encouraging corrupt practices in the sector.

Meanwhile, the law pertaining to bribing public officials entails the offering, promising, giving and receipt of bribes. However, the enforcement of the law is weak. Weak enforcement of anti-corruption laws by anti-corruption agencies due to corruption and bribery has occasioned loss of revenues to the Federal Government. Such revenues could have been used for infrastructural development in Nigeria, if there was compliance with the anti-corruption laws.

Consequently, in 2004, Nigeria set up an Investigation Committee to investigate the allegation of corruption in the sector but the then Attorney General of the Federation (AGF) and Minister of Justice Mr. Michael Aondoaaka applied mere administrative reprieve instead of the criminal prosecution of Halliburton suspects (Igbinedion, 2011). This was a violation of the rationale for sections 174(1)(c) and 211 of the 1999 Constitution of the Federal Republic of Nigeria (as amended) that empowered the AGF to institute, discontinue and undertake criminal proceedings against any person before any court in Nigeria with provisos of taking into cognizance public interest, justice and due process before the exercise of such powers. This abuse of power of nolle prosequi by the former AGF prompted loss of revenues to the Federal Government through frequent unprosecuted incidence of corruption in the sector.

The shoddy prosecution of corruption cases shows that the Federal Government lacks the political will to combat corruption in the sector. Since no one has been successfully prosecuted for the Halliburton bribery case in Nigeria, while other culprits have been convicted in the United States and Germany, this has brought ridicule upon the nation on the international scene. The decline in oil revenues and investments in the sector seems that the Federal Government has resolved not to prosecute the beneficiaries of Halliburton bribery (Ogbonna-Nwaogu, 2010). A strong political will is sine qua non for effective enforcement of anti-corruption laws to guarantee transparency and accountability in the sector.

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