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CFR’s Civil Society, Markets, and Democracy (CSMD) Program highlights noteworthy events and articles each Friday in "This Week in Markets and Democracy.” Africa’s Governance and Economic Struggles New IMF data and the 2015 Ibrahim Index of African Governance (IIAG), both released this week, show stalling or declining economic growth and governance progress across the continent. Despite better health, education, and human development statistics, IIAG found backsliding in accountability and rights, with thirty-one out of fifty-four countries deteriorating. Africa’s business environment—measured as competitiveness, bureaucracy and red tape, and investment climate—scored the lowest and fell the most of any category since 2011. The IMF echoed these gloomy metrics, projecting sub-Saharan growth to slow to 3.8 percent in 2015, hit by an overreliance on commodities. Both sets of data make clear the interdependence of governance and economic growth. The lowest-scoring countries on IIAG’s business indicators—including Eritrea, Somalia, South Sudan, Sudan, and Equatorial Guinea—also ranked among the worst on rights and participation. And Côte d’Ivoire, ranked as IIAG’s “most improved” based on its aggregate governance score is among the few sub-Saharan countries expected to post high growth through 2017. Post-Disaster Aid: When it Works, When it Doesn’t Nearing the six-month anniversary of Nepal’s devastating earthquake that killed more than 8,500 people, comparisons to other natural disaster relief efforts highlight the potential pitfalls of aid delivered in a governance vacuum. Thailand’s post-tsunami recovery fared well relative to others—the country’s centralized (albeit authoritarian-leaning) leadership owned the response, mostly relying on technical rather than financial assistance. In contrast, Haiti remains a cautionary tale—despite some $9 billion in relief aid 150,000 Haitians still live in “temporary” camps and the government remains fragile, as witnessed in the recent chaotic and violent parliamentary contest. Nepal appears to be heading on a similar route with the government yet to draw up a plan for spending $4.1 billion in international donations, even as three million survivors lack shelter, food, and basic medical care in one of the world’s poorest countries. With the new constitution in dispute, a political crisis brewing with India, and a worsening fuel shortage all costing the economy an estimated $1 billion, reconstruction will likely be delayed further. What We’re Reading on the TPP Agreement… This week twelve countries, representing 40 percent of the world’s GDP, signed onto the Trans-Pacific Partnership (TPP). Now experts are chiming in on the many potential effects for participants: Kimberly Ann Elliott from the Center for Global Development summarizes the TPP’s impact for developing countries: cutting agricultural subsidies and expanding access to capital controls may help poorer members, but concerns over rules of origin and intellectual property rights linger. Siddhartha Mahanta finds the changes to the heavily-criticized investor-state dispute settlement process important, saying they may “strike a blow to corporate impunity”—especially cases brought by tobacco companies against smoking bans. As the TPP deal closed, the World Bank announced that extreme poverty will drop below ten percent globally in 2015. John Cassidy argues that trade helped lift 1.3 billion people out of poverty, even as it increased inequality within countries. Fellow CFR expert Ted Alden says that a TPP deal reasserts U.S. leadership in global trade negotiations and strengthens its influence over future rules.    

On October 3, Thomas Piketty, the French economist and best-selling author of Capital in the 21st Century, said in his prestigious Nelson Mandela lecture that South Africa’s “…black economic empowerment strategies… were not successful in spreading the wealth.” He said that 60 to 65 percent of the country’s wealth is held by 10 percent of the population, compared with 50 to 55 percent in Brazil and 40 to 45 percent in the United States. He made the point that out of the wealthiest 5 percent of South Africans  up to 80 percent are white. That South Africa is one of the most unequal countries in the world in terms of distribution of wealth, and that the 9 percent of the population that is white holds a disproportionate share of that wealth is well-known. It is a reality that various black economic empowerment strategies were designed to address and have failed to do so. Piketty in his Mandela lecture made certain suggestions: a national minimum wage, workers on corporate boards, and accelerated land reform. In a comparison of the history of inequality in France and South Africa, Piketty addressed the race factor: “The difference of color of skin is also important because when everybody is white in France, you can sort of forget a couple of generations later who comes from what group, which is more difficult with the color of skin.” There appears to be a consensus in South Africa that “something must be done” about inequality and that formal programs such as the current Broad Based Black Economic Empowerment (BBBEE) are not working. But, there is no consensus about what to do. According to the South African media, former finance Minister Trevor Manuel after Piketty’s speech suggested the issues are political not economic: “We’ve got the framework in place but I think the problems are not in the economics: it is not even in the tax law. Our problems are in the leadership and how we convene society to understand we’re in this together.” From news reports, Piketty does not appear to have addressed the greatest driver of poverty: very high levels of unemployment, which approaches 50 percent in some demographics. That in turn reflects the dearth of unskilled jobs where official trade union and government policy has long promoted a highly-skilled “labor aristocracy.” Paradoxically, there are labor shortages because the poor primary education available to the mass of the population does not prepare them to enter the workforce. Meanwhile, elites benefit from the best academic institutions in Africa, and among the best in the world.

The biggest achievement of the past week’s United Nations General Assembly (UNGA) in New York was the adoption of a new fifteen-year plan for global development. Replacing the soon-to-expire Millennium Development Goals, seventeen new Sustainable Development Goals (SDGs) will guide UN and domestic development policies through 2030 with an ambitious, and some say overly idealistic agenda. Based on UN member and civil society input over a three-year process, the final set of SDGs aims to eliminate hunger, reduce inequality, promote shared economic growth, and “end poverty in all its forms everywhere.” President Obama, UN Secretary General Ban Ki-moon, and Pope Francis all endorsed the new “global goals” during the three-day UN Sustainable Development Summit held in the run-up to UNGA. Here are two major takeaways from the summit: The Global Goal of Good Governance One of the more controversial global goals is SDG 16, which promotes inclusive, accountable institutions and includes twelve specific targets on anti-corruption, representative decision-making, access to information, and the rule of law. With a UN-led global survey of over eight million people ranking governance as a top priority (the second most popular answer in low-income countries), leaders incorporated it into the SDGs despite “adamant resistance.” While many, including U.S. policymakers, support the citizen-led goal, others point to the ambiguity over what “good governance” means, owing to differing perceptions between developed countries and poorer ones. Further, defining and measuring corruption remains difficult, with no standardized cross-country metrics. While polling data propelled governance onto the SDG agenda, citizen participation may also determine whether goal 16’s accountability objectives are achieved. Financing the Global Goals The SDGs now set, the development community must find ways to pay for them as costs are estimated to run $3 trillion a year or more. With private capital as a growing funding source—foreign direct investment (FDI) outpaced government-led assistance by about five times last year—the UN and domestic donor agencies embraced multinationals during the summit. A “UN Private Sector Forum” convened business leaders including Unilever’s Paul Polman, Facebook’s Mark Zuckerberg, and MasterCard’s Tim Murphy with German Chancellor Angela Merkel and Oxfam International’s Winne Byanyima to discuss SDG priorities. Many pitched a win-win “business for good” model that stimulates domestic economic growth and cuts poverty while expanding the customer base. Yet others highlighted the limits of private investment—UNGA President Mogens Lykketoft pointed to the failure of big corporations and wealthy individuals to pay taxes. Next week rich countries may advance this conversation with new international rules to govern multinationals.

Over the past month, there has been a lot of “China drama.” The volatility in the Chinese stock market, the yuan devaluation, and now the Tianjin warehouse explosion have all raised China chatter to a new level of anxiety. Some of the anxiety is understandable. These events have real consequences—above all for the Chinese people. At the urging of the Chinese government, tens of millions of Chinese moved to stake their fortunes not on real estate but on the stock market—the most unfortunate used their real estate as leverage to invest in the market and are now desperate for some good news. The Tianjin warehouse explosion has thus far left 121 Chinese dead, more than seven hundred injured, and over fifty still missing. Globally, the yuan devaluation has triggered a rate rethink by central bankers in Europe and the United States, and the stock market slide has contributed to steep drops in Asian and U.S. markets. Events such as these in any country would garner international attention. In the case of China, however, the noise around such events is amplified by the absence of three mitigating factors: Transparency. A lack of transparency in China compounds the challenge of understanding what is going on. What, for example, is behind China’s devaluation of the yuan? Is it part of Beijing’s bid to push forward on its economic reforms by making the currency more responsive to the market? Is it an effort to persuade the International Monetary Fund that the yuan should become part of its basket of currencies before Beijing has to wait another five years for its currency to be considered? Is it an effort to prop up China’s ever-declining export numbers? Or is it a confluence of all three? Context. While the human toll inflicted by the Tianjin warehouse explosion was devastating, no one should be surprised by the disaster itself or the political aftermath. The pattern of Chinese behavior—including the corrupt environmental impact assessment system that allowed for the placement of the factory so close to people’s residences, the lack of knowledge of what precisely the warehouse stored, the generosity of the Chinese people trying to help those affected, and the attention paid by the Chinese government to assigning blame and shutting down information transmission and popular commentary via the Internet—is one that repeats itself frequently. Perspective. Drama surrounding China is also heightened by the tendency of outside observers to lose a bit of perspective. The media, as well as China analysts—and those who play them on TV— are rewarded for bold statements and predictions. I looked back at what people were saying about the Chinese stock market at the end of 2014 and early 2015 when the market was surging. At that time, unsurprisingly, there was a lot of triumphalism punctuated by a few dark warnings. The Economist, for example, produced a piece, “Super-bull on the rampage,” that focused 95 percent of its attention on all the excitement the stock market was generating, with only five percent at the end mentioning some of the potential weaknesses underpinning the rise in the market. Kudos to Gwynn Guilford at Quartz, however, who pretty much called it all back in 2014, seeking out commentators who underscored the dangers in the stock market’s reliance on leverage, shadow finance, and government public relations. Dramatic events will always prompt breathless speculation and commentary, but real understanding should begin by paying attention to real experts. In the case of the Chinese economy, reading studies by China economists and analysts—for example Nick Lardy, Barry Naughton, Patrick Chovanec, Dan Rosen, Fraser Howie, George Magnus, Michael Pettis, and Victor Shih—would be a good place to start. They represent a wide range of views and, if brought together for a discussion, would be hard-pressed to arrive at a consensus; but anyone taking the time to read or listen to a constellation of them will inevitably become smarter about the Chinese economy. The other much needed commodity is humility.  One of my favorite discussions of the Chinese currency devaluation is David Dollar’s interview in the Nikkei Asian Review. He argues that the devaluation is a “move toward a more market-oriented system but not a blatant effort to push up exports.” But, he then continues on to say, “If I’m wrong….”  This ability to acknowledge what we don’t know with regard to China is at least as valuable as sharing what we do know—and certainly worth more than pontificating about that which we only think we know.

This Week in Markets and Democracy will return on August 28. Until then, here is what CSMD is reading this week. The World Economic Forum identifies ten trends that will shape the future role of civil society—new technology and a focus on inequality topped the list. Economist Dani Rodrik argues that emerging markets are facing a slowdown because they did not follow the fundamental rules of growth, and failed to undertake the necessary political and structural reforms. In light of China’s recent devaluation, Shawn Donnan of the Financial Times looks at currency’s changing role in trade. As economies become more integrated into global supply chains, fluctuations matter less. In a new report, Transparency International concludes that half of the forty-one parties to the Organisation for Economic Cooperation and Development (OECD) Convention on Combating Foreign Bribery have not prosecuted any foreign bribery cases since signing the agreement.

This is a post in a new series on the Development Channel,“This Week in Markets and Democracy.” Each week, CFR’s Civil Society, Markets, and Democracy Program will highlight noteworthy events and articles. Calais Crisis: Europe’s Migration Woes The escalating Calais crisis underscores Europe’s serious migration challenges. Thousands of African and Middle Eastern migrants are camping in makeshift shelters on the French side of the Channel Tunnel and risking their lives in desperate attempts to cross into Britain. In response to Calais and similar scenes playing out across Europe, growing anti-immigration rhetoric blames migrants for taking native-born citizens’ jobs and draining government funds. Yet a study by Oxford’s Migration Observatory finds migrants may actually raise average wages for the UK’s medium and high-paid workers. (Those most adversely affected by UK immigration are likely migrants themselves, who tend to be low-wage workers facing increased labor supply). And as the EU ages and birth rates decline, migration will be vital to maintaining GDP growth and standards of living. Europe is expected to lose nine million workers by 2060. In Germany, the IMF warns that starting in 2020, growth will take a hit due to an aging population. From Calais to the Greek islands, governments are struggling to deal with short-term migration costs without losing sight of longer-term economic needs–the balance will require more cohesive EU migration policies. Time for TPP Deal Running Out Domestic interests prevented the twelve Trans-Pacific Partnership (TPP) members from reaching a final deal last week in Maui, and upcoming elections in two TPP countries threaten further derailment. Who’s to blame? Australia’s farmers want more access to the heavily-subsidized U.S. sugar industry. Mexico, a major auto exporter, made new demands on rules-of-origin for car parts. And the United States is fighting for long-term pharmaceutical patents opposed by all other members, especially developing countries. While U.S. Trade Representative Michael Froman is “more confident than ever that the TPP is within reach,” Canada’s eleventh-hour holdout on dairy concessions, coming as the nation heads toward October elections, undermines that bravado. With other TPP members seeing the dairy issue as non-negotiable, Canada could potentially opt-out or be kept out of the agreement. And even if Canada comes around, TPP pessimists–who note that the stalled Doha Round of trade talks broke down over similar agriculture and intellectual property disagreements–worry that looming U.S. elections will push a deal beyond 2016. Post-2015 Agenda – Moving from Rhetoric to Reality One hundred and ninety-three countries reached final agreement on the Sustainable Development Goals (SDGs) this week, sealing the post-2015 development agenda the UN will adopt in September. Many civil society organizations and governments praised UN member states for reaching consensus on seventeen goals that aim to eradicate poverty “in all forms everywhere,” among other ambitious targets. Advocacy groups celebrated the addition of next generation development issues with increasing global relevance, from ending modern slavery and human trafficking to acknowledging the significance of global migration. Still other rights groups are concerned that the SDGs’ monitoring and review process is vague and insufficient, and lacks a meaningful role for civil society. Getting from rhetoric to reality involves both financing and governance challenges. Only together can the private sector, aid donors and domestic governments raise the estimated $3.3-$4.5 trillion a year needed to fund the post-2015 agenda and guide projects necessary to meet SDG goals–these untested arrangements are already showing cracks.  

The Natural Resource Governance Institute, a New York-based think tank and advocacy organization, has issued a must-read report, Inside NNPC Oil Sales: A Case for Reform in Nigeria. The authors are Aaron Sayne, Alexandra Gilles, and Christina Katsouris. The Nigeria National Petroleum Corporation (NNPC) sells about half of Nigeria’s oil, worth an estimated $41 billion in 2013. The report concludes that NNPC’s approach to oil sales “suffers from high corruption risks and fails to maximize returns for the nation.” The report is detailed—it runs to seventy-one pages with additional annexes. It is thoroughly convincing and offers specific recommendations. It notes that “the bad practices that undermine NNPC oil sale performance all have political interference at their root.” The report also argues that the new presidential administration of Muhammadu Buhari has a unique opportunity to tackle the problems at NNPC, which have long been ignored. At almost the same time the Natural Resource Governance Institute issued its report, President Buhari announced a wholesale sacking of the directors and senior management at NNPC. The president relieved the group managing director and the executive vice chairman, who had been appointed by former president Goodluck Jonathan. The following day, he fired the nine NNPC executive directors. Buhari’s choice of group managing director is Emmanuel Kachikwe. He has been executive vice chairman and general counsel of Exxon-Mobil (Africa). Among other academic attainments, he holds masters and doctorate degrees from the Harvard Law School, according to Nigerian media. He has also worked for Texaco Nigeria. Nigerian media reports that he intends to reduce the number of group managing directors from nine to four. As with his appointment of new military service chiefs, Buhari’s choices indicate that he focuses on expertise and experience, rather than on political connection. Inside NNPC argues that reform of NNPC does not require omnibus legislation, but rather a bold agenda with a short timeline. Buhari’s personnel choices fit that prescription.

South Africa’s general malaise owes much to its very slow recovery from the international economic crisis that began in the United States in 2008. The country’s gross domestic product growth rate has declined from a usual 3 percent to 1.5 percent in 2014. Weaker commodities prices have also slowed an economy that still includes a large mineral export sector. Unemployment is a major cause of South African poverty. It peaked in the first quarter of 2015 at 26.4 percent, according to Statistics South Africa, the national statistical service of South Africa. The rate is even higher among blacks, who constitute about 80 percent of the population. It is estimated that unemployment among black youth in the townships is around 50 percent. It is also high in rural areas. Hence it is good news that in the second quarter of 2015, unemployment dropped to 25 percent, according to the latest reports by Statistics South Africa. Very high levels of unemployment are a characteristic of the South African economy. According to Bloomberg, South Africa has the second highest jobless rate of the 62 countries that it tracks. There are now 5.23 million South Africans without jobs, which marks a healthy decline of about 305,000. The South African government estimates that economic growth will be 2 percent in 2015. This is better than 2014, but still not at pre-2008 recession levels. The South African government’s aspirational National Development Plan looks to cut unemployment to 14 percent by 2020 and 6 percent by 2030. While slow economic growth certainly contributes to high unemployment, there are also important structural issues. Trade unions, allied to the governing African National Congress, keep wages high. Government policy has not promoted the creation of low-skilled, low-paying jobs. Yet, in part because of the shortcomings of the educational system, a large percentage of the population is unskilled. In many African countries, the informal sector of the economy absorbs unemployment. South Africa, however, appears to have the smallest informal sector of any large African country. This, in part, is the baleful heritage of apartheid, which restricted black enterprise and mobility. Moreover, there are numerous other structural and technical drivers of high unemployment. Measuring levels of poverty in South Africa (and elsewhere) is difficult given the variety of technical and definitional issues. However, the Daily Maverick, a respected South African publication, concludes that 21.7 percent of the population lives in extreme poverty. That means they do not have enough money to pay for the food necessary to meet their nutritional requirements. An additional 37 percent are unable the purchase both food and meet other necessities, such as transport and fuel. So, more than half of the country’s population is poor, and a high percentage of the poor are unemployed. Over the past decade, the percentage who are unemployed in South Africa has fluctuated in the mid-twenties. The most recent drop in unemployment is a welcome sign, but is unlikely to be the harbinger of long-term trends. Until the structural roots of high unemployment are addressed in South Africa, serious progress on reducing poverty cannot be made.

This is a post in a new series on the Development Channel,“This Week in Markets and Democracy.” Each week, CFR’s Civil Society, Markets, and Democracy Program will highlight noteworthy events and articles. Takeaways from Third Financing for Development Conference World economic leaders and civil society groups were in Addis Ababa this week for the Third Financing for Development Conference, discussing how to fund global development for the next 15 years. Most debated was international tax reform. Developing countries advocated two changes: replacing the existing OECD tax-regulating body with a UN agency (to give them more of a say), and cracking down on corporate tax evasion. Unsurprisingly, rich countries blocked the UN proposal. One issue that participants were able to agree on–the need for more accurate, real-time development data. As a first step, the U.S., U.K. and the Hewlett Foundation jointly pledged $5 million to the Global Partnership for Sustainable Development Data, launched in Addis on Wednesday. Pope Francis Takes on Capitalism, Corruption in Latin America Pope Francis sealed his status as champion of the marginalized during an eight-day tour through Bolivia, Ecuador and Paraguay. In public speeches and meetings with civil society, he decried the “globalization of exploitation and indifference,” and the ills of free market capitalism–poverty, injustice and environmental degradation. The Pope openly criticized political leaders for their role in deepening inequality, even as many tried to use his visit to boost their credibility. In Ecuador, the Pope urged President Rafael Correa to forego the short-term economic benefits of resource exploitation, responding to indigenous groups’ concerns over expanded oil exploration. In Paraguay, he called on government officials to banish corruption, the “gangrene of the people,” and to improve rule of law with “rapid, clear trials,” a nod to the country’s flawed judicial system. Though the Pope’s message was well-received in a region facing severe poverty and graft, some question bringing this anti-capitalist rhetoric to U.S. Congress and UN General Assembly speeches this fall. Egypt and China Justify Recent Arrests In the name of countering Islamic State terrorism, Egyptian President Abdel Fattah al-Sisi’s government is systematically silencing dissent. Last week’s arrests of four journalists add to the eighteen already imprisoned for allegedly “sympathizing” with the banned Muslim Brotherhood. And a new counterterrorism law that would impose draconian jail sentences on journalists who contradict government information was only amended after significant domestic and international pushback. Egypt’s “anti-terror” crackdowns echo China, where this week security services detained more than 50 human rights lawyers and activists, accused of creating “social chaos” as part of a criminal syndicate.  

Governments, civil society groups, and business leaders are gathered this week in Addis Ababa, Ethiopia for the UN’s Third Financing for Development Conference (FFD3). Up for debate is how to fund the Sustainable Development Goals, or SDGs, a new set of global development indicators that the UN will adopt in September. The Addis agenda reflects two major changes since the First Financing for Development conference held in Monterrey, Mexico in 2002. First, the good news–there has been a dramatic reduction in global poverty. Between 2002 and 2015, 28 low-income countries–as classified by the World Bank–made the jump to middle-income status. The second, less-encouraging trend is that foreign aid commitments from developed countries have faltered. Aid spending is far from the UN target of 0.7 percent of gross national product (GNP) established in Monterrey. Instead, the OECD average is closer to 0.39 percent as of 2014, ranging from 1.1 percent in Sweden to 0.08 percent in Poland and the Slovak Republic. In the wake of these trends, the Addis talks will focus on two alternative approaches—private sector investment and domestic reforms. Foreign direct investment (FDI) in developing countries already far outstrips aid flows, totaling $480 billion in 2012, compared to $90 billion in aid spending. While investment stimulates growth and creates jobs, conference participants want to ensure that FDI contributes to inclusive growth that reaches the poorest populations. One proposal at Addis seeks to end tax evasion by multinational corporations, estimated to siphon $100 billion away from developing economies each year—money that might otherwise be used for health and education, and to modernize agriculture and infrastructure. Another avenue for post-2015 development financing is mobilizing domestic resources. Developing countries can raise revenue through higher taxes–now only 13 percent of their GDPs–and improve collection through automation. Equally important is combating corruption and illicit financial flows, which deprive developing economies of an estimated $1 trillion annually. The policy recommendations adopted at FFD3 will be non-binding. But, they could help set the tone for September, when governments and the development community commit to an ambitious post-2015 agenda that aims to eradicate poverty, end hunger, and ensure water and sanitation for all. Whether the 17 proposed SDGs will be achieved largely depends on financing.            

This is a post in a new series on the Development Channel,“This Week in Markets and Democracy.” Each week, CFR’s Civil Society, Markets, and Democracy Program will highlight noteworthy events and articles. Development Community Debates MDG Report The UN released its final Millennium Development Goals (MDGs) report, hailing the effort as “the most successful anti-poverty movement in history.” Since the MDG’s introduction fifteen years ago, the number of people living in extreme poverty and the global child mortality rate have halved. Yet the development community is split over how much the MDGs mattered for this progress. The Center for Global Development warns that emphasizing goal-setting distracts from policy discussions. On the other side, proponents contend that setting data-based yardsticks and reducing the global agenda to eight priorities helped channel focus and funding. As attention shifts to post-2015 development goals, the UN report recognizes uneven gains–growth in China and India has pulled millions out of poverty while the poor in other countries have been left behind. Modi’s Heavy-Handed Efforts to Control the Indian Narrative The Indian government has delayed release of a UNICEF child welfare survey for months, some believe to avoid political embarrassment for Prime Minister Narendra Modi after his home state of Gujarat–where he served as chief minister until 2014–showed dismal results. These revelations coincide with the public ouster of Nobel Prize-winning economist Amartya Sen from Nalanda University. In a televised interview this week, Sen warned of unprecedented government interference in academia under Modi. Modi’s carefully-crafted narrative extends to social media, where his government rolled out a Narendra Modi mobile app. The app awards points for approving government policies through “likes” and sharing flattering articles about Modi–there is no option to disapprove. Reigning in Civil Society in China and Cambodia The Chinese and Cambodian governments are moving forward with proposed laws that threaten civil society autonomy. China’s NGO bill would require both foreign and domestic groups to undergo vetting by state security forces. While framed as part of a broader rule-of-law campaign, NGOs contend that it would allow the government to shut them down. In Cambodia, the draft Law on Associations and Non-Governmental Organizations (LANGO) gives the government broad powers to dissolve any organization deemed a danger to national security or to the “culture, traditions and customs of Cambodian national society.” Cambodian legislators say the bill enables needed regulation of some 5,000 civil society groups. Human rights advocates disagree–32 domestic and international groups demanded the law’s withdrawal, and protestors rallied at Cambodia’s National Assembly to block its passage.        

Reflecting a drop in government revenue caused by the fall in international petroleum prices, many Nigerian federal and state civil servants have not been paid their salaries, in some cases for up to ten months. To alleviate the hardship, President Muhammadu Buhari has approved what the Nigerian media calls a three-pronged relief package. This package freshly distributes petroleum and liquefied natural gas revenue to the federal government and the states. According to the Nigerian media, the total amount is N804.7 billion (USD 4.05 billion). In addition, the Central Bank of Nigeria will offer financing in the range of N250 billion to N300 billion (USD  1.26 to 1.51 billion) to the states specifically to pay back salaries. The Debt Management Office of the federal government will also help the states restructure their commercial loans, which total an estimated N660 billion (USD 3.32 billion). According to the Nigerian press, twelve of the thirty-six states owe their workers more than N110 billion (USD 550 million). They are: Osun, Rivers, Oyo, Ekiti, Kwara, Kogi, Ondo, Plateau, Benue, and Bauchi. Civil service pay arrears is an old song in Nigeria, and contributes to poor morale and inefficiency. Here, the concern must be that the funds made available by this relief package are actually used to pay civil servants and are not diverted to other purposes by governors. Still, the Buhari-mandated package is a positive step forward.