“The helicopter gunships hovered low over a crowded street, where people had gathered to celebrate an annual festival, and opened fire with machine guns and rockets, according to several accounts. ”

I am lucky to be out of the country! Here is the link to the full story.

Sadly there has been a hostage killed in the delta region of Nigeria.

I am currently in Abuja and leaving for London tomorrow. This was my scheduled departure time but it will feel good to be in a safer place soon.

So in an effort to keep things local and practical to the students here I had a guest lecturer today named Frank Onwuachi from the Microfinance Bank of Oba. The idea was to get away from my theory and knowledge of what works in Canada and get some hands on training for here in Nigeria.

The presentation was a great success! The students seemed to have enjoyed it and got a lot of information out of it and Frank left saying he was happy to come and would be willing to do it again. All in all it seemed like a great win win for everyone.

Some of the things covered: The bank will give loans of up to 10 to 1 the cash you are willing to leave on deposit with them. So if you put 5,000 Naira on deposit they will loan you up to 50,000 Naira. So you don’t need a ton of collateral, which is a big problem for most poor people. You do need to have one guarantor for the loan but this can be anyone; your friend, brother or neighbor. The maximum amount they are willing to loan out is 200,000 Naira or around 1,250 USD.

The interest rates are shocking though. They offer two types of loans of 4% per month or 6% per month. These translate into 60% or 100% effective annual rates if compounded for 12 months. That is a lot of interest! I am told though that this is cheap compared to the 10% per month or 214% effective annual rate the money lenders outside of the banks charge.

The normal banking institutions charge 22% annually but are not accessible for the 65% of Nigerians who are still too poor to use them.

Frank’s family lives in Houston and he moved back to Nigeria a year ago to start his bank. Part of me looks at the effective annual rates and is shocked and appalled at them. Almost makes me think he is a crook. Then I look at the alternatives and think maybe he is a hero. At the end of the day I think he is an entrepreneur who is trying to provide loans to people who value them at more then what he charges. He told me his current delinquency rate is around 10% so not everything always works.

As much as I would love to see entrepreneurs have access to cheaper money this seems to be a win win for Frank and the people who borrow the money. Frank understands this and wants to make sure everyone is happy and he is servicing his customer. That is more then a lot of Nigerians! Truly he wants to do well and help out here, for that I applaud him.

So back in the 30’s Josef Schumpeter described economic growth as creative destruction. You tear down the old and use creative forces to rebuild it better then it was in the past.

This is what I am trying to teach to the students here with a little twist: positive creative destruction.

It is evident here that people can use creative destruction to keep the corruption going and even make it worse if they choose. If they could just keep the creative juices flowing in a positive direction maybe through a lot of baby steps they can destroy old system and replace it with transparency and justice.

It is hard trying to find a way to explain to the people that it is in their own interest not to be corrupt when the chances of getting caught are so low and the rewards so great. How to you explain to someone that they will be better off if they don’t take the million Naira when they know that no one will ever catch them. How would you explain that to someone in Canada let alone here?

The school takes the moral approach. I am trying both that and talking with them about their reputations. How if they take the money it may benefit them in the short term but then it has the potential of ruining there reputation. Not that they will get caught but that other people will suspect them of doing it. If that is the case then anyone who wants to do business with people who are not corrupt would not want to do business with them.

They can’t control the poor reputations of Nigerians at large but they can control their own individual reputations. My best advice for them getting a good reputation is doing what they say they will do. Don’t make false promises and don’t take bribes. Keep everything above board and it will open up doors for them in the future.

Keep your reputation, keep things moving positively to a better place, but don’t be afraid to destroy what was there before you. Schumpeter would have told them that it doesn’t need to be a brand new technology to do this, it can be as simple as using the resources they have at their disposal a little better. Can you get the work one with 9 people instead of 10, can you find a way to get production done one day faster. Can you actually motivate people to do a good days work!

All these are ways of using ingenuity with the local resources to take incremental positive creative destructive steps to improve themselves and their world around them.

Go and DESTROY!

When I meet new people in Nigeria one of the fist questions I try to ask them is if they could change one thing about the country what would it be. The answer is always resoundingly the same thing: fix the corruption.

Over the years billions of dollars has been transferred to Nigeria through loans from the IMF and the World Bank. These loans are meant to be for the common citizen but in talking with them they see none of the money. Instead what the common citizens see is a few people at the top who put billions of dollars into their own pockets and become untouchable here since they have so much cash.

The last three heads of police are all being investigated for corruption. It is pretty hard for the government to charge them with anything since the head of police was hired to fix the elections so people could get in power. How can you bite the hand that knows all of your secrets!

The great story I heard was of ballot boxes being stolen in elections and then allowed to be submitted and counted a couple hours later. What exactly do the election officials think one does with a stolen ballot box??? Check out this story to see what Amnesty International thinks about the situation:

http://thereport.amnesty.org/eng/regions/africa/nigeria

Or another story has the government giving favorable contracts and then getting kick backs off shore so that it can’t be traced here in Nigeria. And you wonder why Nigeria gets such a bad reputation in the world. This is the link to the most recent bribe case:

http://www.nytimes.com/2008/09/04/business/04bribe.html?_r=1&ref=africa

The big problem for the average Nigerian is that this corruption is keeping them in the poverty trap. They can’t get enough assets put together to start saving and improving their education. At least if the government was truly trying to help the people and not themselves the citizens here would have a better chance of moving towards prosperity.

As if the pot holes the size of cars were not enough to keep things at a crawl when driving in Nigeria, add to that having to stop and talk to the police every 5 minutes!!

This would generally give you a sense of peace they are police officers after all! Here in Nigeria though it is a different story all together. As I have been told I can do anything I want here, after all if I have money freedom is just a bribe away!

At least the road blocks have a method for dealing with these things. A line up of the people who don’t want to pay slows thing down while a second much faster line with people hanging money out the window zips past. The general toll: 20 Naira or around 15 cents! We are lucky since we travel with a policeman that we don’t get stopped but the openness about the bribes is just amazing to see.

So far I have not had to pay any bribes. A little bit of charm and getting them to laugh is my first approach and if that doesn’t work then I throw a fit and yell at them. As a white person they are still a little fearful of me.

I don’t really know what is worse that the police all are looking for bribes here or that the fact that I am white and there is still racism here to make them scared of me gets me off from having to pay.

Here is a report going on from the BBC about the safety here in Nigeria. Enubu the city they are taken from is where I fly out in and out of and around 40 minutes from the house I am staying at.

Mom, you shouldn’t read these!!!

On Patrol With Nigerian Police

Nigeria’s Vigilantes

So my first week in class came with a few distractions from the students. Talking with the other lecturers about it they told me that I had to lay down the law. So from this came our new rules for engagement:

Our classroom manifesto:

Class starts promptly at the scheduled time.
No latecomers to class will be permitted, this includes latecomers from breaks.
If you are late please join the class during one of the breaks.
If your phone rings during class you will be asked to leave and not return until a class break occurs.
No listening to music during class.
No yelling or being disrespectful to your lecturer or classmates at any time.
No mid class interruptions from guests.
This page will act as the attendance for this class.

Failure to abide by any of the above will result in being asked to leave the class.

If you agree to the above please place your name, registration number and signature below.

Name Registration Signature

Out with the Sheriffs badge to get some structure in the class!!!

So I wanted to leave the school last week and go down to an internet café to post a blog when I was casually informed that I was not allowed to leave the university. It turns out that there was an armed bank robbery just down the street. Sadly the robbery resulted in the loss of life.

Robberies, violence and corruption are all part of life here in Nigeria. The robberies are infrequent and the violence is mostly focused in the Delta region by the oil companies then it is where I am staying. That being said it is still always here in the background. As much as I would love to have full days to be productive here I am limited due to the curfew that has been imposed on me for my own protection. I can’t be out any later then 6 pm. It is for my own good they tell me.

Not listening to rules, as usual, I stayed at an internet café until 8 pm the other day and I was getting phone calls from people worried for my safety. Getting ready to leave we unlocked the door to the café yet still having a couple of minutes before we would actually go the owner promptly locked the door again saying that it wasn’t safe. The door comes with a sliding peep hole just like in the movies.

I really look at it like everywhere else I have travelled. If I keep my eyes open and don’t do anything that stupid then I am sure I will be fine. Here I just have to be prudent and keep my eyes open more then usual.

It is getting close to 6

When I first arrived I was spending the bulk of my time with Peter the school registrar. Here the school registrar runs all the non academic parts of the school as well as looks after students acceptance into programs. To put it another way; Peter is way to busy to baby sit me!

Nothing like a few peeps to make the adventure here a little more interesting!

Tansian University has around 1,000 students who study across 17 different disciplines. The Pro-Chancellor or head of the school is a gentleman named Father Bosco who is about as nice as anyone can get.

I guess human nature is not that different wherever you go….