The purpose of this study is to increaseknowledge about state capacity in Nigeria by taking stock ofgovernance issues, including public financial management andcivil services, and analyzing them in representative statesacross the regions, as states assume an expanded role indelivering services to their populations under the 1999constitution. Specifically, the study lays the groundworkfor preparing a program of assistance to state governments,should the Federal Government seek financing from the Bank.Before capacity can be strengthened, the context forcapacity building must be understood and the constraintsanalyzed. Thus the study focuses both on the evolving storyof federalism in Nigeria, as well as the challenges statesface in managing their finances and delivering services inthe aftermath of misrule and decay under the military. Sixstates were selected for review: Bauchi, Nasarawa, Rivers,Anambra, Ogun and Sokoto--one from each of the geo-politicalzones of Nigeria. These are some of the principal findings:There is a great deal of variation across states in theircapacity for governance. A new generation of state governorsis emerging, albeit still a minority. Some are beginning toaddress public sector reform, through civil servicemodernization and right sizing, and strengthening financialmanagement. These last are suggested areas for support, butthey must be calibrated with the commitment to state reform,and not provided as an entitlement.
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