CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
Corruption is unarguably one of the most topical issues in the discourses of the deepening crisis and contradictions of post-independence Nigeria. The level of attention devoted to it ·may not only be due to its rapid and unprecedented expansion to all facet of human Endeavour and its menacing consequences, but also because of the seeming fecklessness of successive attempts at combating it. The problem has become so endemic that, as (Omotola 2006; 2004) has pointed out, one can begin to talk about the political culture of corruption in the country. To be sure, Transparency International, an international non-governmental organization that is reputed for its exploits in its measurement of countries' Corruption Perception Index, ranked Nigeria as the most corrupt among the 52 countries ranked in 1996 and 1997.
This could be regarded as of little significance as the country was then under the firm authoritarian grip of the military. The hope that the advent of democracy in 1999 would mark an appreciable breakaway from the past, including the country's perennial problem of corruption, largely remains in the pipeline. Nigeria, in·what seems senseless squandering of hopes, ranked as the most corrupt in 2002, the second most corrupt in 2003, and the third most corrupt in 2004 (Omotola, 2006). These findings point to the fact that the anti-corruption war has hardly made a positive impact in the country, perhaps due to the depth of the phenomenon.
It is important to know that ‘corrupt’ acts are displayed at various sectors in Nigeria, but this work would focus more attention on exposing and proffering solutions to various means of corruption in the governmental/political body in Nigeria, both in the Federal, state and local levels, as decisions made at these levels affects every facet of life.
Nigeria is rich in natural resources, but the problem lies with the technique at which the political leaders manage and allocate the profits realized from these resources as they are directed to the wrong sources because of the thought of retaining a portion of the budget for their personal uses. The nature reflected by these leaders is therefore that of greed; and it is evident as we see a leader deciding to carry out a particular project at the expense of another because of his/her vision of generating profits from the budget set aside for the initial project for their personal pockets.
Due to these corrupt acts and more, Nigeria is still facing problems of bad roads, low educational standard, bad electricity supply, bad and limited amount of bridges, undeveloped and obsolete railway systems and many more, because when the initial budget for a project is intentionally reduced, the result of the job done will be poor requiring attention again after a short while. This makes us know that corruption and its illicit acts pull the country backwards, thereby hampering development.
Amuwo (2005) and Obayelu (2007) consider corruption as the exploitation of public position, resources and power for private gain. Fjeldstad & Isaksen (2008) and Ogundiya (2009) define corruption as “the betrayal of public trust for individual or sectional gain”. Obayelu went further to identify corruption as “efforts to secure wealth or power through illegal means for private gain at public expense; or a misuse of power for private benefit.” Corruption covers a broad spectrum of activities ranging from fraud (theft through misrepresentation), embezzlement (misappropriation of corporate or public funds) to bribery (payments made in order to gain an advantage or to avoid a disadvantage). From a political point of view, Aiyede (2006, p. 5) views corruption as “the abuse or misuse of public or governmental power for illegitimate private advantages.” His view corroborates the position of Lipset and Lenz (2000) that corruption is an effort to secure wealth or power through illegal means for private benefit at public expense. Tanzi (1998) adds that such abuse of public power may not necessarily be for one’s private benefit but for the benefit of one’s party, class, tribe, or family. Although corruption is global in scope, it is more pronounced in developing societies because of their weak institutions. It is minimal in developed nations because of existing institutional control mechanisms which are more developed and effective. The effects of corruption on a nation’s economy are damaging. A nation inundated with corruption cannot be viable economically; neither can the system generate enough support/ affection required for the survival of democratic system. This is a situation in Nigeria where corruption has become part and parcel of the political culture. Corruption has indeed robbed Nigerians the benefit of economic development because scarce available resources that should have been deployed to execute development project have gone into private foreign accounts.
Corruption is widespread in Nigeria, not because the people are different from other parts of the world, but because the conditions are ripe for it. There are many reasons why this is so. The motivation to earn income from among the populace is relatively stronger; exacerbated by poverty, unemployment and low wages. In many developing countries Nigeria inclusive, accountability is generally weak. Political competition and civil liberties are often restricted. Laws and principles of ethics in governance are poorly developed and the legal institutions charged with enforcing them are ill-prepared. The research seeks to investigate corruption in Nigeria as a threat to sustainable Economic development.
1.2 Statement of the Problem
The menace of corruption, which has eaten deep into the fabrics of all sectors of Nigeria projects and programmes, would require all the necessary antidotes to effectively control it. In other words, no single and simple remedy will achieve it. Nigeria has documented the solutions to tackle corruption; but like poverty bedeviling the nation, implementations of the laws are the Achilles heel (a vulnerable point) of the society. In the name of turning Nigeria into a corruption-free society, the nation has experimented with many strategies, programmes and policies. It has tried the judicial commissions of enquiry, the Code of Conduct Bureau. It had wrestled with the Public Complaints Commission to no avail. Also it fiddled with the Mass Mobilization for Social Justice and Economic Recovery (MAMSER), and the National Open Apprenticeship (NOA), War Against Indiscipline and Corruption (WAIC), National Drug Law Enforcement Agency (NDLEA) in 1989, Money Laundering Act of 1995 re-enacted 2004, Advance Fee Fraud (419) and Fraud Related Offences Act of 1995, prosecution and conviction of high ranking administration officials, tracing, seizing and confiscation of all proceeds of crime, privatization of failing public institutions, creation of an enabling environment for effective private-public partnerships, Failed Banks Act of 1996, Banks and Other Financial Institutions Act of 1991, Foreign Exchange Act of 1995 etc. But to our greatest dismay, corruption instead blossomed admist all the purported weapons of war against corruption.
1.3 Objectives of the Study
The study sought to know the effect of corruption on sustainable economic development. Specifically, the study sought to;
i. determine the level at which corruption has an effect on economic development in Nigeria.
ii. know the effect of corruption index and employment level on sustainable economic development in Nigeria.
iii. evaluate the relationship between the corruption index and employment level.
1.4 Research Questions
i. To what extent has corruption affected economic development in Nigeria?
ii. What are the effects of corruption index and employment level on sustainable economic development in Nigeria?
iii. Is there a relationship between the corruption index and employment level?
1.5 Research Hypotheses
Hypothesis I
H0: There is no relationship between the corruption index and employment level.
H1: There is a relationship between the corruption index and employment level.
Hypothesis II
H0: Level of corruption does not have an effect on sustainable economic development in Nigeria.
H1: Level of corruption does not have an effect on economic development in Nigeria.
Hypothesis III
H0: There is no effect of corruption index and employment level on sustainable economic development in Nigeria.
H1: There is an effect of corruption index and employment level on sustainable economic development in Nigeria.
1.6 Significance of the Study
This study will be of immense benefit to other researchers who intend to know more on this study and can also be used by non-researchers to build more on their research work. This study contributes to knowledge and could serve as a guide for other study.
1.7 Scope of the Study
The study appraises corruption in Nigeria and elucidates its effect on sustainable economic development. The study employs data mainly from the secondary source which are obtained from the CBN publications.
1.8 Limitations of study
Financial constraint: Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).
Time constraint: The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.
1.9 Definition of Terms
Corruption: Amuwo (2005) and Obayelu (2007) consider corruption as the exploitation of public position, resources and power for private gain. Fieldstad & Isaksen (2008, p. 3) and Ogundiya (2009, p. 5) define corruption as “the betrayal of public trust for individual or sectional gain.” Obayelu went further to identify corruption as “efforts to secure wealth or power through illegal means for private gain at public expense; or a misuse of power for private benefit.” Corruption covers a broad spectrum of activities ranging from fraud (theft through misrepresentation), embezzlement (misappropriation of corporate or public funds) to bribery (payments made in order to gain an advantage or to avoid a disadvantage). From a political point of view, Aiyede (2006, p. 5) views corruption as “the abuse or misuse of public or governmental power for illegitimate private advantages.
Economic Development: According to Imhonopi & Urim (2010), national development is the ability of a country or countries to improve the social welfare of the people, namely, by providing social amenities like good education, power, housing, pipe-borne water and others. The components of national development include economic development, socio-cultural empowerment and development and how these impact on human development. Without human development, which is the development of the human capital of a nation or its citizens, national development can be thwarted or defeated. In fact, human development is one basis for judging the effectiveness of the economic development component of national development (Ogboru, 2007; Ranis, Stewart, & Ramirez, 2000). As they observed, economic development expressed in GNP can increase human development by expenditure from families, government and organizations such as NGOs. With the increase in economic growth, families and individuals will likely increase expenditures with the increase in income. This increase can lead to greater human development. Streeten (1982) put it better when he said that development must be redefined as an attack on the chief evils of the world today such as malnutrition, disease, illiteracy, slums, unemployment and inequality. In other words, development must be measured in terms of jobs created, justice dispensed and poverty alleviated.
Corruption Index: This is the ranking of countries according to the extent to which corruption is believed to exist. The corruption perception index was created in 1995 by Transparency International. It ranks almost 200 countries on a scale of zero to 10, with zero indicating high levels of corruption and 10 indicating low levels.
Employment Level: This simply means the level at which people are employed in Nigeria annually.
