Elections are not the ultimate arbiter. Power struggle in key oil state typifies political risk in Nigeria.

A tussle for supremacy between Rivers state governor Nyesom Wike and federal transport minister Rotimi Amaechi is stoking political tension in the state. Private investors must beware - they risk getting caught in the crossfire. 

Governor Wike of the People's Democratic Party (PDP) is seeking re-election in February 2019, but his re-election is far from certain. To win he must counter the efforts of former Rivers state governor Amaechi of the All Progressives Congress (APC), who is backing energy businessman Tonye Cole to unseat the incumbent. 

We trace the rift back to 2015 when Amaechi and Wike first became opponents. At the time, Amaechi was concluding his final term as governor while Wike was a federal minister. Wike defeated Amaechi's preferred candidate in that year's governorship election riding on 'federal might', which in Nigeria refers to the use of federal institutions such as security forces by a federal government figure against a political opponent. 

The 2015 dynamic is now reversed. Wike is governor while Amaechi now wields the federal might as a minister in the president's cabinet, and, perhaps unsurprisingly, Amaechi is inclined to retaliate against his old nemesis. This has set the stage for the potential for severe political violence. Already, there's been militant clashes involving both sides, notably in Amaechi and Wike’s home area of Ikwerre. 

Political violence is markedly pronounced in Rivers state because of the high incidence of militancy, and because the state gets the second largest share of oil revenue from the federal government, enticing politicians seeking enrichment. 

The fall out of the rivalry is certain to touch foreign investors who remain attracted to the state. Investors with interests in physical facilities, such as shopping centres or factories, face a risk of disruption to their supply chain, production or sales; as well as a risk of physical damage and in the worst case scenario - loss of life. We are aware that Shoprite is in talks with the state to set up a new mall. There is also the recently built Next Mall which is said to be backed by foreign investors and by Peter Obi, the People’s Democratic Party’s (PDP) vice presidential candidate. These are some of the assets that may be affected by the fall-out of the Amaechi-Wike rivalry.

Beyond this, there is a risk of political interference in major contracts, in the form of delays or cancellations. We have noted rumours of the transport minister blocking certain investments at the Onne port to spite Wike. ATM Terminals is one of three concessionaires at the port.

These dynamics are not unique to Rivers state. With the February 2019 elections drawing close, we are observing disputes in other states between political leaders scheming to retain or win control of patronage networks. In Lagos for instance, the state governor Akinwumi Ambode won't even be on the ballot in next year's election. APC party bigwigs such as Bola Tinubu have chosen Babajide Sanwoolu to replace him, and sources describing the fallout ascribe it to the governor's programs and contracts that put old patronage systems at risk—and consequently alienated party chiefs.  

Nigeria's electoral system continues to place control in the hands of the elite, more so than rank and file voters, and the implications for foreign investors remain significant. Politicians will try to outdo opponents by gaining physical control of voting areas, raising security risk. Contracts and private investment become easy targets in a political brawl, and elected officials will answer to the influential individuals who put them in power, and not the electorate.