Fears of a coup in Nigeria fade, but President is in rough waters

Nigerian President Alhaji Shehu Shagari is facing the severest test yet of his ability to balance the demands of competing regional and tribal groups. Nigerians adamantly deny that any of the difficulties threaten the country's two-year-old US-style democracy. And rumors last month, circulating largely among Western sources, that a military coup was possible -- or even likely -- now appear to have been exaggerated.

but there appears to be little question that the Shagari government, firmly -- opponents have said, arrogantly -- in control since its election in October 1979, has lost momentum because of the recent domestic and international troubles.

Moreover, the manner in which President Shagari handles the current crisis seems likely to determine whether he will remain the choice of the Hausa-dominated National Party of Nigeria (NPN) for president in 1983, and indeed, whether the NPN will retain the reins of power in Lagos.

Mr. Shagari's problems come from several directions, and at a glance, all would appear to defy easy solutions.

In early July, the often-fragile coalition of Shagari's NPN and the Ibo-dominated Nigerian People's Party (NPP) that had permitted Mr. Shagari to push through the congress his ambitious five-year plan, the 1981 budget, and the controversial revenue-sharing formula, broke apart for good. With it went Shagari's guaranteed majority in both the Senate and the House of Representatives.

Two days after the breakup, a dispute between civilian and religious personalities in the northern city of Kano erupted in violence. Religious disturbances there last December had left 2,000 people dead and the Shagari governmnet badly shaken when it was forced to call on the Army -- quiescent since handing over power in October 1979 -- to restore order.

The President's problems did not stop at the Nigerian border, either. A small border clash with neighboring Cameroon in mid-May led to a crescendo of criticism from opposition leaders, the press, and reportedly the military for Shagari's failure to "retaliate." Only Cameroon's agreement to compensate families of five soldiers killed in the action defused the Nigerian xenophobia and the mounting criticism of the President.

Nor is politics -- domestic or international -- Shagari's only trouble. Since the beginning of the year, Nigeria's oil production has declined steadily, as a result of growing world surpluses and Lagos's refusal to lowers its $40 -per-barrel price, one of the highest in the world.

Western oil company sources here say production is now little more than one-third of the normal 2 million barrels per day.

Not only does Nigeria count on oil exports for 90 percent of its foreign earnings, but also economic sources in Lagos say that the ambitious $125 billion five-year plan unveiled in January was based on a return of $39 per barrel, and exports of 1.9 million barrels per day in 1981 alone. (Modest price increases were factored in for subsequent years.)

Perhaps the most intractable problem is the economic one. Barring a sudden cutback in production by Saudi Arabia -- which Nigerian Vice-President Alex Ekwueme has blamed for the current world oil surplus -- the Nigerian authorities are faced with the disagreeable choice between lowering prices and continuing the production cutbacks.

There are some reports that the Nigerians have invited recalcitrant buyers "in for a chat," according to one source, but no sign yet that they are willing to drop their price by the $5 per barrel the companies say is necessary to put it in line with other suppliers.

Given the traditional Nigerian distrust -- a dislike, really -- of oil companies, any concession to them is certain to have political ramifications. Nevertheless, the sharp drop in exports has reduced income severely, with expectations that the country will make only about half -- or less -- of the $27 billion projected at the beginning of the year.

Already, members of Shagari's government have conceded that both the 1981 budget and the 1981-85 development plan may have to be cut back.

And that too will have a political price tag. But despite the unquestionable seriousness of the problems, Nigerian and other African sources discount rumors o an imminent collapse of Nigerian democracy as alarmist Western hyperbole.

"I don't think it's really a crisis," a Nigerian diplomat said calmly.

"It's hot [in Nigeria]," acknowledged another African diplomat just back from Lagos. "But I think Shagari will come out on top. I think he's stronger than they [the opposition] are."

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