Scramble for Africa resources fuels graft

2012-02-09 21:50

Johannesburg - The scramble for oil and mining contracts in Africa's most resource-rich countries risks aggravating corruption and instability on the continent, Global Witness warned on Thursday.

The natural resource industry watchdog raised alarm over oil and mineral deals involving shady local companies with politically connected shareholders and foreign firms that vehemently resist efforts to increase transparency.

The group called on the United States, Europe and China to make companies publish what they pay governments to operate mining and drilling projects, and for resource-rich African countries to disclose who benefits.

"Many resource-rich countries in Africa have suffered deeply from corruption, conflict and unfair foreign exploitation," Gavin Hayman, director of campaigns at Global Witness, said in a statement.

"Their citizens have a right to know how oil and mineral deals are being done, who is taking part in these deals and where the money is going."

Global Witness said it found a deep lack of transparency in a series of case studies on the awarding of oil and mineral rights in Angola and Nigeria, the continent's top oil producers, and in the Democratic Republic of Congo, famed for its wealth of cobalt, copper, diamonds and gold.

The report - titled Rigged? The Scramble for Africa's Oil, Gas and Minerals - found evidence that senior government officials in Angola and Nigeria had taken advantage of local investment requirements meant to benefit small businesses to acquire stakes in oil licenses.

Deals murky

In one case, an Angolan company called Grupo Gema that acquired such a licence was partly owned by men who had the same names as the former secretary to Angola's council of ministers and chief police commissioner.

In another, an investor who appeared to be the Nigerian lawmaker who chaired the senate committee on petroleum owned part of a consortium that won an offshore oil block.

But the group could not confirm that the officials were actually involved.

The report proposes a "Citizens' Checklist" that would enable anyone to trace the benefits of a resource-rich country's wealth.

"Very little of the information that actually shows how resource rights are won, and where the benefits go, is available to the public," it says.

"Unless and until this happens, pledges of greater transparency in the extractive sector will have little meaning."