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November 14, 2003 - USAID and Shell form partnership to launch
$20 million Nigerian Development Program
 
Photo of Connie Newman and Dawn Liberi with Shell executives
 

The United States Agency for International Development (USAID) and the Shell Petroleum Development Company of Nigeria Limited (Shell) today announced they are to be partners in a $20 million sustainable development program in Nigeria.

The agreement was announced in Washington D.C. by Andrew S. Natsios, USAID Administrator, and Sir Philip Watts, Chairman of the Committee of Managing Directors of the Royal Dutch/Shell Group of Companies.

The partnership is one of the largest country-specific agreements under USAID's new business model, the Global Development Alliance, which promotes public-private partnerships to implement sustainable development programs around the world. By partnering with the private sector, in addition to developing country governments and non-governmental organizations, USAID is able to extend its reach and effectiveness in responding to new global challenges.

USAID Nigeria in the News
 
Shell will contribute $15 million over the next five years to the partnership and USAID will contribute $5 million. The partnership's program will aim to help build capacity and opportunity for Nigerians in the strategic areas of agriculture, health, and small and medium size enterprise.

USAID and Shell initially plan to focus their work on food security through a cassava cultivation support program; the prevention of malaria; and supporting the export shrimp industry.

The cassava project is expected to be the first to commence, with start-up by the end of 2003. Its aim is to provide greater income for cassava farmers in 11 Nigerian states. The program will improve technology transfer to address cassava mosaic disease and to develop cassava processing. It will also help identify further commercial markets for cassava, such as ethanol production, livestock feed and use in baking. In addition to being a staple food, starch from cassava is already used in other industries including textile manufacturing.

The cassava project will be implemented by the International Institute of Tropical Agriculture in Ibadan, an international agricultural research centre which has successfully implemented USAID and other cassava program. The institute is also a key partner with the Government of Nigeria in the implementation of the Nigerian Presidential Cassava Initiative.

Sir Philip said today: "Shell already spends about $60 million annually in the Niger Delta on its well-established social investment program. I am proud that Shell will now be able to extend this important work with this partnership with USAID. I am confident that our program together will make a significant contribution to socio-economic development in Nigeria and in the Niger Delta in particular. "

Mr. Natsios said: "Investing in people is perhaps the single most important factor in achieving long-term economic growth. USAID is proud to partner with Shell in the Delta region, particularly as we embark on implementing a new $350 million, five-year program of development and capacity building throughout Nigeria."

USAID has been working in Nigeria since the 1960s and provides $65-70 million annually in development assistance to Nigeria in the areas of democracy and governance, economics and agriculture, education, health and HIV/AIDS.

The Shell Petroleum Development Company of Nigeria Limited was incorporated in 1937 and is the oldest and largest producer of oil and gas in Nigeria. Shell in Nigeria spends some $60 million each year on social investment, assisting communities to develop agriculture and social infrastructure including community health and educational facilities.
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On September 25, 2003, the United States Agency for International Development (USAID) Mission to Nigeria and the Shell Petroleum Development Company (SPDC) signed a five-year, $20 million Memorandum of Understanding (MOU) to share their common goals of promoting democracy, stability and economic prosperity in Nigeria. USAID/Nigeria will contribute $5 million and SPDC will contribute $15 million. This is the largest strategic partnership for USAID.

The MOU was signed with the understanding that an Addendum will be executed for each specific activity to be implemented. Initially, USAID and Shell will focus on food security, economic growth and health activities such as cassava cultivation, prevention and treatment of malaria, and support for the shrimp industry. The first Addendum, to be signed by USAID/Nigeria and SPDC/Nigeria in mid-November 2003, will launch the Cassava Enterprise Development (CED) Project. This $4.2 million Project is a four-year, integrated initiative that aims to provide income for cassava farmers in eleven Nigerian states by increasing production, expanding post-harvest, value added processing, and identifying commercial markets for cassava within various industries.

The USAID and Shell strategic partnership will help promote economic growth and stability by revitalizing the cassava industry. Cassava is one of the most widely-cultivated crops in Nigeria and provides food and income to over 30 million farmers and large numbers of processors and traders. It is an important regional food source for 250 million people in West Africa - nearly one-third of the population of sub-Saharan Africa.

Despite the significance of cassava to the region, production has been nearly stagnant over the past ten years. More recently, this food-staple has been threatened by the Cassava Mosaic Disease (CMD). Having devastated crops in Uganda in the late 1980s, CMD became a pandemic in East and Central Africa by 1999, causing up to 100 percent loss of the crop in affected areas. In Nigeria, the most vulnerable areas are the South-South and South-East states, including the Niger Delta region. The Delta is an area that has suffered historical conflict and unrest and is the center for Nigeria's multi-billion dollar oil industry.

The United States, through USAID, is the largest bilateral donor to Nigeria. Under USAID/Nigeria's Transition Strategy, 1999 - 2003, USAID provided assistance to Nigeria totaling more than $320 million in support of democracy and governance, economic management and agricultural growth, education and health, including HIV/AIDS, and infrastructure.

USAID/Nigeria's recently approved five year strategy for 2004 - 2009 will provide close to $350 million to improve democratic governance, increase economic livelihoods, enhance social sector services delivery, and reduce the impact of HIV/AIDS. USAID/Nigeria works at national, state and local government levels with over 500 local public, private and civil society partners to develop activities and approaches to consolidate democratic rule, increase incomes and delivery key social sector services (education and health) to communities. USAID/Nigeria also works with communities, particularly women's groups and other non-governmental organizations, to help institutionalize democratic principles and increase the capacity of these organizations to advocate for their needs and hold government accountable.

The Shell Petroleum Development Company (SPDC) of Nigeria has a long history in Nigeria and has grown to be one of the largest oil companies operating in the country. Consistent with sound corporate citizenship and its support for sustainable development, Shell has substantial social sector investments in the Niger Delta, the area from which it extracts oil and gas, as well as other regions of Nigeria.