Olusegun Obasanjo

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During Nigeria's presidential election campaign in February, reporters were unsure how to address poll favorite Olusegun Obasanjo. Should they call the former President and retired military leader Your Excellency or simply General? "Just call me Uncle Sege," Obasanjo told them, referring to the affectionate name used by his family and friends.

Nigerians are not accustomed to such humor from their leaders. The country, Africa's most populous, has spent three of the four decades since independence ruled by the military. For much of the 1990s Nigeria suffered under the iron fist of General Sani Abacha, who seized power from fellow army officers in a 1993 coup and then used threats and terror to maintain control until his unexpected death from a heart attack in June 1998. Little wonder then that Obasanjo's earnest exhortations to rebuild the country — together with his refreshingly informal approach — appealed to voters. The 62-year-old Obasanjo, jailed by Abacha in 1995 for allegedly plotting a coup and released last year after the general's death, won the Feb. 27 election with 63% of the vote. In late May, he was sworn in as Nigeria's first democratically elected President in more than 15 years.

Nigeria's re-emergence as Africa's Great Black Hope was one of the continent's few high points in 1999. Countries like Eritrea, Ethiopia, Rwanda and Uganda — two years ago at the forefront of a supposed African renaissance — were either at war with each other or fighting elsewhere. A quarter-century of war in Angola heated up again, dashing hopes for a lasting peace, while in the Horn of Africa Somalia entered its ninth year without a government. Fighting in the Democratic Republic of Congo sputtered on, despite a peace deal and the presence of U.N. monitors, and clashes between government forces and ethnic Hutu in Burundi increased. Ghana faced a financial crisis and the economies of Kenya and Zimbabwe, once among the strongest in developing Africa, deteriorated.

Two positive notes were that at year's end a shaky truce was holding in Sierra Leone, where eight years of civil war have left at least 50,000 people dead and thousands more limbless after horrific machete attacks, and new South African President Thabo Mbeki won office in free and fair elections after the retirement of Nelson Mandela.

Obasanjo, who has taken on Mandela's role as elder statesman and unofficial spokesman for the continent, may have shown a lighter side during campaigning, but he wasted no time in getting tough once in power. He suspended all contracts made this year under General Abdulsalam Abubakar, who assumed office after Abacha's death and returned the country to democracy; he sacked the heads of many of the hopelessly inefficient state utilities and all military officers who had held political appointments from 1985; he promised to cut the size of the military from 80,000 soldiers to 50,000; he set up an inquiry into past human rights abuses, including any committed during his stint as Nigeria's military leader from 1976 to 1979; he announced an ambitious program of privatization; and he went after the ill-gotten gains of Abacha and other military dictators. "I believe that there is great need for moral and spiritual regeneration within our society," Obasanjo told Time days before being sworn in as President in May.

Perhaps most symbolically, Obasanjo ended the notorious fuel shortages that had come to define the decay and corruption in the world's seventh-biggest petroleum producer. Fortunately, world oil prices more than doubled this year, allowing room in the budget for spending on programs such as free primary education.

But the oil price windfall will not solve all the country's problems. Nigeria still needs to repair its crumbling infrastructure and pay off — or, as Obasanjo hopes, have canceled — a debt of around $30 billion. Violence has escalated in the oil-rich southwest, where local tribes are angry that so little of the oil wealth trickles down to them. Obasanjo has introduced a bill that will give locals a bigger share of profits, but tension remains high.

Other divisions appeared in October, when to the consternation of southern Nigerians, who are mostly Christian, the northern state of Zamfara declared its intention to introduce Islamic Shari'a law, which bans alcohol and includes such punishments as amputation for those guilty of theft. Ethnic tensions have already erupted into violence this year. Clashes in a Lagos market last month between Yoruba and Hausa, the two largest groups in Nigeria, left at least 50 people dead.

A lot rests on the new President. Friends describe him as a pragmatic and down-to-earth man who talks straight but has a short temper. After stepping down as leader in 1979, he retired to his farm outside the town of Otta, 80 km north of Lagos, where he farmed pigs and chickens and eventually set up an international think tank called the Africa Leadership Forum. Now based in the capital, Abuja, Obasanjo still likes to escape to Otta, where he runs local errands, eats goat stew with his fingers, reads, and writes to old colleagues overseas.

"Because of what happened in the recent past, many Nigerians were about to give up in desperation," Obasanjo said in May. "[They asked:] 'Is there any hope? Can it be done?' Now they are coming back, [saying] 'Maybe it can be done.' And I believe it can be done." It will be years, perhaps decades, before Nigeria regains the confidence it had during the oil boom of the 1970s. But under Obasanjo, a military-man-turned-democrat, at least the country has renewed reason for hope.