General Sani Abacha's 33-member cabinet includes several people, such as the Petroleum Minister, Don Itiebet, the Finance Minister, Kalu Idika Kalu and the Agriculture Minister, Adamu Ciroma, who command respect among Western creditors; but its room for manoeuvre depends entirely on the military. Only a radical effort to clean up graft, slash the budget deficit, and reach a new agreement with the International Monetary Fund (IMF) could begin to halt the slide.
The challenge is daunting. World prices for Nigeria's main export, oil, have fallen to 10-year lows. That means Nigeria's 1.8 million barrels per day in petroleum exports will earn dollars 1.3bn ( pounds 870m) less per year than was budgeted for. Arrears on the dollars 30bn foreign debt have reached dollars 5.9bn, or about one-fifth of the country's economic output.
'The Western creditors cannot do anything,' said one economist. 'They are not getting paid now, and they cannot reschedule the debt unless there is a deal with the IMF. So all they can do is wait.'
Living standards have plummeted. Last year alone a 100 per cent inflation rate halved Nigerians' purchasing power. Civil servants, police and soldiers, including the contingent to the international force in Somalia, have not been paid for at least two months.
Prospects for a quick economic turnaround in Africa's biggest oil- producing nation are bleak. When Ibrahim Babangida took power in 1985, he promised a get-tough economic programme to foster foreign investment, reschedule foreign debt, and eventually create jobs. By 1991, an agreement with the IMF was collapsing as government budget deficits exploded.
A 60-page report on the budget commissioned by the Ernest Shonekan administration, which General Abacha overthrew last month, found that in the first half of 1993 alone, General Babangida's government deposited dollars 1.5bn from oil exports into secret 'dedicated accounts' for special projects.
The study also said the military had run up large debts for arms purchases that the government could not meet. The British Vickers company is delivering 150 tanks in a sale that Western military analysts have described as irrelevant to the country's defence needs. A contract was signed this year with the German manufacturer, Dornier, for 100 Air Beetle training aircraft, beating a bid by the British Slingsby firm.
Investigating past financial misdeeds has been ruled out. 'Probing individuals is to probe millions of Nigerians in the business class, in the civil service, in the judiciary, in the military, in the police,' said Lieutenant-General Odalipo Diya, vice-chairman of the Provisional Ruling Council.
Ten years ago, when General Abacha announced a coup d'etat against the elected government of Shehu Shagari, he lambasted the civilian administration. 'You are all living witnesses to the grave economic predicament and uncertainty which an inept and corrupt leadership has imposed on our beloved nation,' General Abacha said then. 'Our economy has been hopelessly mismanaged. We have become a debtor and beggar nation.'
Since then, the situation has worsened dramatically under a military government in which General Abacha held the number-two position.
During that time massive budget deficits and political instability have driven down the value of the currency, the naira, from about pounds 1 to less than two pence.