Press Release / Feb. 8, 2002

Blair and Chirac must require transparency of resource revenues as a key to African development

Tony Blair’s call for a clamp down on companies that fuel wars across Africa is a landmark statement that must be followed with genuine regulatory action.

The lack of transparency in resource extraction industries across Africa sees the corporate sector providing major funds to unaccountable military and political elites who then use conflict to cover corruption and embezzlement in countries such as Angola (oil and diamonds), Democratic Republic of Congo (timber, diamonds, coltan), Sierra Leone (diamonds, Liberian timber) and the Sudan (oil).

Global Witness’ investigations in Angola suggest that almost a third of state revenue, some US$1.4 billion, went missing last year. “Highest level individuals connected to the Presidency – Angola’s ‘Oligarchy’ – loot cash from oil revenues and oil-backed international loans off the back of arms trafficking and the military procurement process. Angola’s war has been privatised,” said Global Witness director Simon Taylor. “The missing funds are over five times the US$200 million that the UN barely scraped together to feed the country’s one million internally displaced people”.

Most international oil companies in the country, such as ChevronTexaco, TotalFinaElf, Agip and ExxonMobil, are complicit in state looting because they refuse to release any public information about the magnitude of their payments to the state, making it impossible for civil society to hold the Angolan Government to account over the misappropriation of money from ‘their’ resources.

If Mr. Blair is serious about tackling the lack of transparency, his solutions must move beyond voluntary approaches like the OECD Guidelines for Multinational Enterprises. Even if companies want to be transparent, they face having their concessions terminated and awarded to less scrupulous competitors. “Mr. Blair must level the playing field between companies and call on the stock market regulators, such as the UK’s Financial Services Authority, to require companies to report their payments to all national governments as a condition for being listed,” added Mr. Taylor.

French President Jacques Chirac, who is to host the New Partnership for African Development in Paris (NEPAD) today, must also call for transparency over resource revenues to prevent NEPAD coming to stand for “National Evasion of Public Accounting and Development”. Further, Chirac must himself come clean about his own role in France’s Angolagate arms-to-Angola scandal and set an example by requiring French-Belgian oil company TotalFinaElf to publish what it pays to governments across Africa and internationally.

Please contact Simon Taylor or Gavin Hayman on +44 (0)7957 142121 or +44 (0)20 7272 6731.

Editor’s notes:

(1) Global Witness focuses on the links between the exploitation of natural resources and the funding of conflict and corruption.

(2) In December 1999, Global Witness published ‘A Crude Awakening’ – an exposé of corruption in Angola and an examination of the complicity of the oil and banking industries in the plundering of state assets. ‘A Crude Awakening’ highlighted a central set of characters - Angola’s ‘Oiligarchy’ - who may be responsible misappropriating Angola’s oil revenues.

(3) UK companies operating in Angola include BP and Shell. BP created a precedent on transparency in February 2001 by stating that it will publish what its pays in Angola and in all countries of operation but, so far, no public information has been provided.