Drumming Support for the NEAT Initiative in Nigeria

By Innocent Edemhanria

The NEAT (Nigerian Endowments through Asset Transformation) Initiative represents an innovative approach to addressing the chronic funding challenges faced by Civil Society Organizations (CSOs) in Nigeria. Through its strategy of “Philanthropication through Privatization” (PtP), the initiative seeks to leverage assets, including recovered loot, extractives industry proceeds, and debt swaps, to create endowments that can independently fund developmental work. By channeling proceeds from asset transfers into independent, private, charitable foundations, it hopes to fund projects that address Nigeria’s economic, social, and climate challenges.

The initiative has three elements. Firstly, there is an asset that is owned, controlled, or substantially subsidized by government. Secondly, there is a planned transaction through which this asset is being sold, leased, or otherwise transformed or transferred yielding significant proceeds (simply put, the asset will be invested which then continuously yield proceeds). Thirdly, an agreement is made that all or a portion of these proceeds will be channeled into an independent, private, charitable foundation dedicated to priority public-purpose objectives operating under best practice principles of transparency, accountability, and community responsiveness.

The governance principles would involve independent governance, professional management, transparency (operate with complete transparency—statutes, by-laws, grant information, board and staff list, reports, and finances would be publicly accessible), there would be accountability and conflict of interest provisions, and the governance should be meaningfully representative of the constituencies they serve through robust community consultation processes.

Good Examples to follow

Specific case studies exist of similar models which have been demonstrated in other jurisdictions. In fact, up to 643 NEAT types of foundations have been identified in 28 countries around the world and such foundations are managing over US$201bn. The NEAT Initiative is inspired by successful models in other countries, like the BOTA Foundation in Kyrgyzstan and the Kiisi Trust Foundation in the case of human rights abuses in Ogoniland, Nigeria. The BOTA Foundation in Kyrgyzstan was established through a multi-lateral agreement to accountably and efficiently distribute returned corruption-based assets to the neediest citizens of Kazakhstan. The BOTA foundation has been widely cited as one of the most effective and successful examples of asset return administration, including by Transparency International France in its 2022 “Handbook for Asset Restitution.”

The Kiisi Trust Foundation (KTF) was set-up from the philanthropic actions of the plaintiffs of the 2009 Wiwa vs. Shell lawsuit with USD 5 million out of the USD 15.5 million out-of-court settlement in the U.S. District Court for the Southern District of New York. The plaintiffs where victims of human rights abuses arising out of SPDC’s operations in Ogoniland. At the time of the settlement, it was agreed that the Kiisi Trust “should stand as one legacy of the labours of our heroes past.” The Kiisi Trust Fund is used to support programmes in education, health, community development, and other benefits for the Ogoni people and their communities.

Justification for the NEAT Initiative

There is a decline in Official Development Assistance (ODA). Nigerian civil society organizations (CSOs) rely disproportionately on international donors, with more than 500,000 organisations competing for scarce donor funds even as Official Development Assistance (ODA) to Nigeria declined from $11.43 billion in 2006 to just $3.38 billion in 2020—a 70% drop.

There is a huge debt profile, recovered loots and significant revenue from the petroleum sector to harness. According to DMO. Nigeria currently has a total public debt profile of US$88.89 Billion as of September 30, 2024. Huge sums of money have been recovered by the Nigerian government, and more are still being negotiated. The country has earned and still earning significant revenue from the petroleum sector.

Lessons can be drawn from the recent dismantling of USAID and the foreign funding freeze by the U.S. president, Donald Trump. If the Trump approach works, some more countries may take a cue from the U.S. As a result, by tapping into the significant revenue from Nigeria’s petroleum sector and leveraging recovered assets and debt swap, NEAT offers a potential solution to the financial needs of CSOs, especially as reliance on international donors declines.

The Initiative can also fill gaps in the areas of corruption, insecurity, infrastructure deficiency, and poverty. CSOs should thus be enabled to promote good governance in Nigeria and fill service gaps. However, sustainable, locally generated resources are needed to support this internal development work. While some private philanthropy exists in the country, primarily from high-net-worth individuals, it is insufficient to meet the needs of CSOs, especially for advocacy organizations championing human rights, climate change adaptation and resilience, inequality, and other broad governance work. The fact is, Nigerian CSOs need funding that is reliable, sustainable, transparent, and sufficient to be effective partners in addressing the country’s pressing social needs.

Efforts and Goals Moving Forward:

High-level advocacy efforts have been launched, including the formation of an advisory committee by the Africa Network for Environment and Economic Justice, to push for the adoption of the NEAT initiative by the Nigerian government. The committee will engage with key stakeholders, including government officials within the executive and legislature, academia, and civil society organizations, to drum support for its adoption and implementation.

To succeed, the initiative needs passionate advocates who can raise awareness and garner political support. It is a promising strategy for addressing the funding challenges faced by CSOs and contributing to the country’s development.

The NEAT initiative represents a bold and innovative step toward self-sustaining, locally driven development solutions in Nigeria. With support, it could play a significant role in addressing the country’s most pressing social and economic challenges.

Innocent Edemhanria is ANEEJ Programme Manager and writes from Benin City