Sunday, February 29, 2004
Big brother is bugging you
This US political consultant thinks that scare tactics are the best strategy to win the elections:
Only terror and Iraq work for the GOP's advantage... So the key is for Bush to heighten the saliency of terrorism as an issue. After all, Americans are wrong to see terrorism as a fourth-place issue... The more they feel that terrorism is still at our doorstep -- as it is -- the more they back Bush as the better wartime leader... Bush must make clear to us all the threats that remain.
That UK military historian sees a world of differences between bugging and eavesdropping...
There is a world of difference. Bugging is usually an illicit and sometimes a criminal activity. It often involves breaking and entering; at the very least, underhand activity. Interception, however, is an everyday activity of all governments, carried on not only against each other but also their own citizens. It is an essential tool in the fight against terrorism and organised crime and, while British courts impose strict limitations on the evidential use that can be made of material thus acquired, even the judiciary recognises that the police and the anti-terrorist organisations could not function unless they eavesdropped on their targets.
... in order to absolve the government and blame the victims:
If the substance of the story comes down to radio interception, the grounds for outrage are greatly diminished. This is an electronic world. Governments and organisations which expect not to be overheard should go into another business.
You thought we live in 2004? Wrong. Since 9/11, we are all living in a timewarp... back to 1984. "This is an electronic world", indeed. For these experts, as for New Labour and GOP, "power is not a means; it is an end".
Saturday, February 28, 2004
"Oh dear, there will be a transcript of this and people will see what he and I are saying"
Clare: Why bug Angola, Cameroon, or Guinea? Don't they know the Gulf of Guinea is closer than the Persian Gulf?
Kofi: Remember Tony's words, whend he said "Africa is the scar on the conscience of the world."
2003:::January 31
2003:::March 2
2004:::February 26
Friday, February 27, 2004
Fridayblog: blogging loud!
When I got this idea of the Fridayblog, I didn't foresee how far-reaching it would become for me. It's like a little oasis of fresh air in a sea of African Oil swamps. I thought it would be fun to have a recurrent section of the blog inside the blog that would be like a nice rendez-vous for you and me. The truth is now that I need it more than you likely do. I wait for the last moment, when I'm done with "serious" posts; then I can just relax in front of my CRT, then freestyle like creazy on my keaboard and use the literary means of the personal narrative to tell you about the people I've been connected with in the week that's now ending. It's all about conversations and actions happening right here right now in cyberspace; conversations you can join if you want to.
What were the most interesting conversations of the week? Asking that question now leads me to a set of topics that was widely discussed by like-minded bloggers lately: Joi Ito's post following Zephoria's echo chamber essay (that was itself a kind of reply to David Weinberger's article on Salon) is a good example of conversations I've followed without actively participating. However, the ideas expressed in the posts and some comments the triggered haunted me. It's only now that I realise that the Fridayblog - which is a good example of metablogging or blogging about blogging - is an excellent way (at least for me) to avoid becoming an "echochamberist" (I borrow this funny word from Joi Ito himself). Why? Because fridayblogging helps me distance myself from what I'm writing about: these conversations have already taken place and I'm not trying to make a smart contribution; being more meditation than minute-blogging, the words that come to my minds now open a new trajectory in the stream of my consciousness. It's like de-programming myself from the group-think nature of the echo-chamber phenomenon. (You're lost? Don't worry because the cool thing about fridayblogging is that I will then write about something else).
Ethan spent two days revising his "digital democracy" post. He turned it into an essay that will be eventually included in a book O'Reilly is planning to publish on Emergent Democracy. Congratulations to you Ethan. I'm glad some of my modest contributions to the debate were incorporated to the draft. I advise those who enjoy my fridayblogs to read it and send him your feedback. A place to look for the future of digital democracy is Adam Curry's blog news agency concept. The idea was in the air; he captured it nicely. I don't know if he intends to implement the concept. If he does, I'll keep track of the project to see how and if I can contribute. It's a practical solution to the issues adressed in Ethan's essay. Joi Ito's new interest for Africa and his connections to global media might help boost such a project. By the way, Joi was serious about visiting Africa. This what he wrote this week in the post I mentioned earlier:
Shouldn't we recognize the fact that people will hang out with their friends and create communities and try to focus on how use these communities together with our weak ties? I think that the project that Ethan and I are planning is an example of this. The idea is to take a group of bloggers to Africa. The strong ties allows us to have a group of people with whom we share a context so that we can support each other and work together to think about and create action based on things we see and learn in Africa. Going to Africa is an attempt to forge weak ties with a community outside. I think that without the smaller group of friends, trying to tie my Africa experience into my daily life would be more difficult and I think that going to Africa will enrich my local community with lots of new information and culture. I think the perfect balance is what we are trying to achieve.
Things are coming full circle. Time to talk about something else: the second Bloggercon is scheduled for April 17. It will be massive, and I'm sure most people I mentioned in this post will be there. So will I (hopefully). Join us. As for blogging & Africa, blogging from Africa or Africa-focused blogging, Akwe sent me a mail: I'll keep her offline reply to my online comment to her lastest Blogafrica post about Amoako's blog OFF the record. As for Amoako himself, he wrote about the audience's reaction to his speech (read "lecture") in Washington last week: "there was a lot of enthusiasm for the ‘capable state’ concept", he says. I read this as an invitation to reply, given the fact that I discussed his (not yet copyrighted) "capable state" concept in my previous comment to his speech. And I sent him my congratulations for his nomination and participation to the Commission on Africa, launched and chaired by British PM Blair. Yes!
Another big surprise came though my mailbox: (probably) after reading my post about his forthcoming book, Thomas Barnett from U.S. Naval War College dropped me a mail. He wants to send me an advance copy of his manuscript. Expect an interview with him soon on African Oil Politics. Before I went to bed, tired and happy, someone who has read my post on Sao Tome's revenue management law sent me a copy of the draft written byMartin Sandbu from Columbia University. What can I say about all these unexpected developments in Blogalia? Just 4 words: the power of blogging. I have no choice but keep on blogging loud!
Nigeria's sea-based war against pipeline pirates
I just read a story that can be read as a follow-up to my post on "Sea-based terror" sent two days ago, on Wednesday 25 and a previous one on piracy in the Gulf of Guinea. The excellent Environmental News Networks's site published an article by Associated Press journalist Dulue Mbachu that confirms the trend towards an increased militarization of Gulf of Guinea waters:
A donated U.S. Coast Guard ship sailed Thursday to Nigeria, where navy commanders said they would rig it with cannon and machine guns to guard international oil production against pirates and militants. The newly rechristened N.N.S. Obula, which arrived in the commercial capital of Lagos on Thursday following a 60-day voyage from Guam, is one of seven vessels the United States is donating to Nigeria, Africa's largest oil producer. Three ships arrived last year and three more vessels are expected in coming months. The ship, with an estimated worth of US$3.5 million, will be refitted with cannon and machine guns to battle militants and criminal gangs along the coast and the winding waterways of the violence-torn southern Niger Delta, said Lt. Commander Mohammed Wabi, spokesman for Nigeria's navy command post in Lagos. "We will use the ships ... to check the activities of those who steal crude oil," Wabi said. "The ships will be fully geared with guns and such military equipment you would expect a navy ship to have." Nigerian Vice Admiral Samuel Afolayan called upon the ship's new crew to "end the trouble in the Niger Delta," where ethnic and political militants frequently attack multinational oil installations... accusing the firms of colluding with Nigeria's government to deprive the impoverished, swampy region's residents of oil revenues.
I have nothing to add but this: in August 2003, Nigerian federal authorities have already established a joint security task force in Delta State (including army, navy, air force and mobile police) known as "Operation Restore Hope" that have not eradicated violence from the oil-rich region. Maybe the name of the operation is to blame: it didn't turn out well in Somalia and it's not working better in Nigeria. Or maybe the problem can't be solved by military might alone.
Thursday, February 26, 2004
U.S. Lifts 23 Year Old Ban on Travel to Libya
It's what some people call a breaking news of historic magnitude. If you've read our previous posts, you probably know better. Blair will visit Libya soon. US oil companies will resume their Libyan activities. Libya will be a key ally of the US-UK and will be rewarded with military cooperation and business investments. What can we add to this concert of forthcoming breaking news? This vintage African Oil Politics comment: Libya is the first high profile case of the US-UK "axis of oil", also known as "US-UK energy dialogue" revealed by the Guardian:
The [UK] government is helping the US to secure a guaranteed supply of oil from new sources in Africa and elsewhere... According to an internal memo to George Bush and Tony Blair, cooperation between the two governments has already delivered "immediate... substantial benefits". The decision to act was taken at a private summit at the president's Texas ranch in April last year.
That was few weeks AFTER Libya got in touch with the United Kingdom in a gesture to be reintegrated into the international community. CIA chief Tenet confirmed the date of the move in his latest declaration to the US Senate: "For years Qadhafi had been chafing under international pariah status. In March 2003, he made a strategic decision and reached out through British intelligence with an offer to abandon his pursuit of WMD."
You can image what Blair, who was already spying on the United Nations on behalf of the US National Security Agency, has made of such a piece of "intelligence":
American and British governments have woven together the "separate strands" of their countries' energy and foreign policies in a "frank sharing of strategic analysis and assessments". The countries have agreed "a set of coordinated actions to help achieve [their] objectives" across the world. The big British and American energy companies have been given favoured access to the discussions between the governments, taking part in meetings with officials. Both governments are keenly aware that, while the demand for oil is likely to rise, they cannot depend on the volatile and hostile Middle East as a safe source. ... British officials were charged with developing "investment issues facing Africa that could be ripe for US-UK coordinated attention".
The Guardian story focuses on West African oil, but given Libya's energy reserves, there's no reason to exclude the possibility. The "substantial benefits" to be gained by the US-UK partnership from the Libyan move are obvious enough for us not to feel that such a backward-looking view is somehow vindicated.
Pentagon report may change climate at White House & World Bank
According to a Pentagon planning unit, climate change is a national security threat greater than even the scourge of international terrorism. Peter Schwartz, CIA consultant and former head of planning at Royal Dutch/Shell Group and Doug Randall of the California-based Global Business Network, the authors of a report entitled "An Abrupt Climate Change Scenario and Its Implications for United States National Security" forsee how global warming could push the planet to the edge of anarchy and annihilation.
'Disruption and conflict will be endemic features of life,' concludes the Pentagon analysis. 'Once again, warfare would define human life.' The findings will prove humiliating to the Bush administration, which has repeatedly denied that climate change even exists. Experts said that they will also make unsettling reading for a President who has insisted national defense is a priority.
According to writer and independent journalist Mark Hertsgaard, the most immidiate outcome of the report will be felt at the World Bank. Those who have expected a gradual change at the institution might might well be surprised by a radical tipping point U-turn on April 15:
One immediate effect may involve the World Bank, whose board of directors is expected to vote by April 15 on a controversial recommendation to stop all funding of coal and oil development, the two fuels most responsible for the carbon dioxide emissions that propel climate change. The vote poses a dilemma for World Bank president James Wolfensohn, for the recommendation comes from an advisory commission he himself appointed to show that the bank was open to input from civil society. ... Citing the dangers of climate change and the often punishing human rights and pollution effects on local people, the review urged that the bank halt all coal loans immediately and all oil loans by 2008. ... These changes would amount to a virtual revolution in the World Bank's operations, so it's not surprising that bank management has resisted them. ... According to a draft response, World Bank management wants the board to reject nearly all the commission's reforms. Rather than halt coal and oil loans, management urges $300 million to $500 million a year in new funding. Fossil fuels, reasons the draft, are the cheapest energy available and thus promise to speed Third World countries' ascent from poverty.
I'm not as optimist as Mark. The World Bank is already an ice-age body, with a default built-in sub-program designed to help it resist change. Climate change is unlikely to overcome the Bank's institutional homeostasis. If something moves, it will be for political reasons.
'Disruption and conflict will be endemic features of life,' concludes the Pentagon analysis. 'Once again, warfare would define human life.' The findings will prove humiliating to the Bush administration, which has repeatedly denied that climate change even exists. Experts said that they will also make unsettling reading for a President who has insisted national defense is a priority.
According to writer and independent journalist Mark Hertsgaard, the most immidiate outcome of the report will be felt at the World Bank. Those who have expected a gradual change at the institution might might well be surprised by a radical tipping point U-turn on April 15:
One immediate effect may involve the World Bank, whose board of directors is expected to vote by April 15 on a controversial recommendation to stop all funding of coal and oil development, the two fuels most responsible for the carbon dioxide emissions that propel climate change. The vote poses a dilemma for World Bank president James Wolfensohn, for the recommendation comes from an advisory commission he himself appointed to show that the bank was open to input from civil society. ... Citing the dangers of climate change and the often punishing human rights and pollution effects on local people, the review urged that the bank halt all coal loans immediately and all oil loans by 2008. ... These changes would amount to a virtual revolution in the World Bank's operations, so it's not surprising that bank management has resisted them. ... According to a draft response, World Bank management wants the board to reject nearly all the commission's reforms. Rather than halt coal and oil loans, management urges $300 million to $500 million a year in new funding. Fossil fuels, reasons the draft, are the cheapest energy available and thus promise to speed Third World countries' ascent from poverty.
I'm not as optimist as Mark. The World Bank is already an ice-age body, with a default built-in sub-program designed to help it resist change. Climate change is unlikely to overcome the Bank's institutional homeostasis. If something moves, it will be for political reasons.
Resource curse in Nigeria & in the NYT
I can't help being appalled by Nigeria’s rising poverty level. Then I read Jeff Madrick's review of the Mineral Resources and Economic Development,
by Stanford economic historian Gavin Wright and his colleague Jesse Czelusta. The orignal paper is rather nuanced (check the document in my pdf permalinks); reviewed by the New York Times, it takes a more upbeat tune: Gavin Wright agrees that "overdependence on a single resource can lead to poor policies, but it is by no means inevitable. To the contrary, many developed and developing nations have used their mineral resources as springboards to wealth and broader-based development - not least the United States itself. ... Some nations do well with their endowments, others do not." Now I feel much better.
by Stanford economic historian Gavin Wright and his colleague Jesse Czelusta. The orignal paper is rather nuanced (check the document in my pdf permalinks); reviewed by the New York Times, it takes a more upbeat tune: Gavin Wright agrees that "overdependence on a single resource can lead to poor policies, but it is by no means inevitable. To the contrary, many developed and developing nations have used their mineral resources as springboards to wealth and broader-based development - not least the United States itself. ... Some nations do well with their endowments, others do not." Now I feel much better.
Sao-Tome: Oil revenue management law
After pioneering the "resource curse" research field, Jeffrey Sachs from Columbia University is now applying his knowledge and connections to help countries and African oilstates facing the "paradox of plenty". Last year, he has assembled a team of scientists and experts to advise the Sao Tomean government on a pro bono basis. Lately, Martin Sandbu, the man in charge of the "oil revenue management law" side of the project, has handed the draft of his work to the authorities in Sao Tome. Here's a nice little story about his adventures in Sao Tome:
Sao Tome and Principe, a poor island nation off the coast of Africa, recently discovered oil and, fearing this "paradox of plenty," asked for advice. The first influx of money from oil exploration contracts with Chevron/Texaco and other companies could be over $100 million, several times Sao Tome and Principe's annual gross domestic product (GDP). In September, [Martin] Sandbu was asked to sit in on a phone call with Jeff Sachs and the President of Sao Tome and Principe. As a result, President Fradique de Menezes, invited a group of advisers to Sao Tome and Principe in November 2003, and that group included Sandbu. During his research on the island, Dr. Sandbu conducted over forty interviews with presidential staff, cabinet ministers, parliament, judiciary, civil society, unions, and UN staff. Sao Tome and Principe is a small country, which offers the possibility for great change," says Sandbu. "It doesn't suffer the inertia of some of the larger countries, so there is hope this new wealth can be managed differently, in a way that alleviates poverty and disease." Sandbu may return to San Tome in a few weeks to help advise parliament on the writing of the "oil revenue management law," aiming to help the country avoid the problems that have plagued other low-income oil exporters. By integrating natural resource management for the benefit of everyone, Sao Tome and Principe stands to become a model for sustainable development in the 21st century.
I think I heard something like this about Chad before oil started to flow. Then the president started to use its oil bonanza to buy guns.
Escaping the Resource Curse
Escaping the Resource Curse:
Managing Natural-Resource Revenues in Low-Income Countries
Hosted by
Center on Globalization and Sustainable Development
The Earth Institute at Columbia University
Sponsored by
The Open Society Institute
February 26, 2004
9:00 am – 5:30 pm
I really get mad when I read a workshop program like that and can't attend it physically nor digitally. I'll be doing a little research of mine and try to find a blogger amongst the speakers: George Soros, Terry Karl, Jeffrey Sachs, Michael Ross, Philippe Le Billon, Martin Sandbu, Simon Taylor...
Managing Natural-Resource Revenues in Low-Income Countries
Hosted by
Center on Globalization and Sustainable Development
The Earth Institute at Columbia University
Sponsored by
The Open Society Institute
February 26, 2004
9:00 am – 5:30 pm
I really get mad when I read a workshop program like that and can't attend it physically nor digitally. I'll be doing a little research of mine and try to find a blogger amongst the speakers: George Soros, Terry Karl, Jeffrey Sachs, Michael Ross, Philippe Le Billon, Martin Sandbu, Simon Taylor...
Wednesday, February 25, 2004
Introducing the African Force
While American and British officials were waiting for Libya to express regrets about its PM Ghanem's comments and accept full responsibility for the Lockerbie bombing, African diplomats were gathering around Gaddafi, in Syrte. A special summit of the African Union (AU) is scheduled for Feb. 27 and 28, following a meeting of African defence ministers that took place earlier, Feb. 22 and 23. The leaders are expected to adopt the African Common Defense and Security policy discussed by the defence ministers.
The summit will come as the conclusion of a process that started two years ago, at the inaugural summit of the African Union, in South Africa in 2002. The summit had then approved the creation of a Peace and Security Council and was followed over the last two years by detailed proposals for an African Standby Force (ASF) and for a Common African Defence and Security Policy (CADSP). These discussions gave birth to plans for a continent-wide defence policy and a permanent military rapid reaction force. These plans are already ground-breaking, but Gaddafi has more ambitious visions for Africa:
Libyan leader Muammar Gaddafi, who likes to be seen as something of an African patriarch, on Monday renewed his call for a much more radical idea: the merging of all national militaries into a single, million-strong African army, saying this would halve the continent's defence expenditure. While this plan reputedly enjoys just enough support to get on to the Syrte summit agenda, most African countries dismiss it as unworkable or undesirable.
President Festus Mogae of Botswana, a former Oxford University economist, has clearly expressed his skepticism and dismissed the idea as "Gaddafi's dream". He's maybe right, but the idea of an African Union that would replace the Organisation of African Unity also sounded like a fantasy when it was first made public. Nothing will stop Gaddafi on his way to becoming a patriarch - as long as he uses Libya's oil money to foot the bill for his visions, and find African leaders ready to listen for money.
Sea-based terror & WMD proliferation in Africa
Since Africa is considered the soft belly in the war on terror, and containerized shipping a vulnerable link in the chain of global trade, containerized shipping in Africa is becoming a hot topic in U.S. Department of Homeland Security. Every year, some 200 million sea cargo containers move among the world's top seaports. This represents around 80 percent of world trade traffic, an attractive target for terrorists as well as a hard-to-monitor way to transport WMD: nearly 50 percent of the value of all imports arriving in the United States is made via sea container. With the American presence and anti-terror operation in the Horn of Africa, the continent has started playing an increasing role in the global U.S. war against sea-based terror and proliferation. More African countries are being invited to join in the fight.
In December 2003, the Container Security Initiative (CSI), a U.S. anti-terror initiative to secure cargo, became operational at the port of Durban: As part of the CSI program, CBP [U.S. Customs and Border Protection] will deploy a team of officers to the port of Durban to work with host government personnel to target high-risk cargo containers destined for the United States. ... CSI is the only formal program in operation today that is designed to detect and deter terrorists from exploiting the vulnerabilities of containerized cargo. When in South Africa last week, General James Jones discussed with Mbeki who declared that "fighting terrorism is very much on the African agenda."
Last week, Liberia and the United States signed an "agreement that would permit American security forces to board and search any ship under the Liberian flag suspected of carrying weapons of mass destruction (WMD), their delivery systems, or related materials." The importance of such an agreement is obvious: Liberia, with more than 2,000 vessels under its flag, has the second largest ship registry in the world after Panama. According to a CNN report, one-third of America's imported oil arrives in the United States on Liberia-flagged tankers. The deal has been facilitated by the Liberian international ship and corporate registry, a US-owned company which runs Liberia's maritime operations from is headquarted in the United States. Oil tankers and western ship owners make use of Liberia's flag of convenience for its tax benefits. I ignore how often they travel African waters; but one thing is certain: US navy, coast guards or custom agents are now to be find in North Africa (the Med), East Africa (the Horn), South Africa (Durban) and (soon) West Africa (the Gulf of Guinea) with Sao Tome or any other Gulf country as a likely location for a forward operation base. Rule America!
Tuesday, February 24, 2004
China-Angola reconstruction cooperation
China's African oil politics is making inroads in Angola, starting with infrastructure and reconstruction cooperation. Angola and China are both ruled by market-friendly communist regimes: oil and politics strengthen any kind of business ties.
Lybia's PM buying a virtual peace
The diplomatic community was expecting the United States to lift the ban on American passport travel to Libya today. Officials in the Bush administration's State Department had let it be known that the United States would announce the good news on Tuesday 24. Then something unexpected happened that triggered the decision by the US administration to delay easing Libya sanctions. What exactly had happened?
Earlier, [Libya's Prime Minister] Dr Ghanem was asked [on the BBC] why Libya had paid compensation over Lockerbie but not apologised. He said: "We feel that we bought peace. After the sanctions and after the problems we faced because of the sanctions, the loss of money, we thought it was easier for us to buy peace and this is why we agreed on compensation." But the victims' relatives insisted they had not been bought off, and expected Libya to take responsibility and co-operate with further investigations.
Ghanem's frankness became the media hype of the day. First, British officials tried to alleviate the devastating blow of Ghanem's declaration to Blair and his plan to visit Libya. British Foreign Secretaty Jack Straw declared that as far as the UK was concerned, the Libyan position remained unchanged: in a letter sent to the United Nations in August 2003, Libya wrote that it "accepts responsibility for the actions of its officials," one of whom was convicted of the bombing. The Tory opposition didn't take things so lightly and urged Blair "not to visit Libya until proper and public assurances are received". In the USA, the first reaction was to insist Libya take responsibility and admit Lockerbie bombing. State Department spokesman Richard Boucher Libyan leadership to "to explain and retract". Later on, the United States announced its decision to delay the lifting of travel restrictions. End of drama. How should one understand PM Ghanem's declaration and what does the American decision change?
First of all, one has to understand that Shukri Ghanem is not a diplomat, but an economist. He was appointed in June 2003 as Prime Minister, but his real job is the transformation of the Libyan economy: he has to open the economy to foreign investment and implement a new liberalization policy. He either knew what the impact of his words would be on the relatives of those who died in the bombing or he couldn't imagine such a thing. In the first case, he may have spoken as he did to show the Americano-British part that Libya remains defiant, untamed.
Mr Ghanem's remarks are very much in line with Libya's previous tactics of putting up a smokescreen to hide the fundamental changes in its position. This would be easily understood by Libya's friends. His words even echo the words of Colonel Gaddafi himself last summer when Libya finally agreed on compensation for the Lockerbie attack. For example, Mr Ghanem said of Libya's decision to pay compensation for Lockerbie: "We thought it easier for us to buy peace and that is why we agreed to compensation." The Libyan leader also declared that Libya had bought its way out of trouble. "God curse money. What is money for? With money we defend our country."
As for the importance of the travel ban on US-Libya oil relations, it is very limited. Those who think that easing the sanctions now could allow U.S. oil companies to resume activities in Libya ignore the fact that US oilmen already travel to Libya: "Eventually removing the travel ban would not have much effect on the U.S. oil companies, whose executives have been able to visit Libya in recent years with special permission." Since there is no technical reason to maintain the travel ban, Ghanem's words as well as US/UK reactions are but a diplomatic face-saving issue for the parties involved. Pure machismo!
Sudan: illusion of peace, reality of conflict
Marian Tupy, Africa specialist at the Cato Institute, wrote an exciting commentary on Sudan's ellusive quest for peace. Like in his previous essays and op-eds, Tupy remains a contrarian, an anti-utopist. One may not share his deep seated beliefs, but one cannot easily discard the cold-blooded clarity of his analysis. And that's one more reason to read his latest piece; once again, he's thought-provoking, refusing to indulge himself into the kind of rosy optimism expressed by the current U.S. administration's Africa officials when it comes to Sudan.
Rebel leaders from the south of Sudan and the government negotiators from the north have been meeting in the Kenyan city of Naivasha, attempting to put an end to Africa's longest civil war. The U.S. secretary of state, Colin Powell, who attended the peace talks last year, has telephoned the negotiators to urge them toward a final agreement. Despite the State Department's "optimism," however, the sad truth is that the accord will, at best, result in a prolonged, but ultimately doomed, ceasefire.
The rest of the piece is a review of the key obstacles likely to block the road to peace. The legal component of the agreement is a first problem:
According to reports, the rebels and the government in Khartoum have agreed to share revenue from Sudan's southern oil fields. But there will be two legal systems -- restricting the application of the harsh Islamic Sharia law to the Muslim north -- and two separate banking systems, allowing southern banks to charge interest on loans to individuals and businesses. Further, there are unanswered questions concerning a legal system that will govern the capital city and the fate of three provinces in central Sudan, which will either form a part of north or south. After an "interim" period of six years, the South will be allowed to hold a referendum on whether it wants to remain a part of Sudan or become independent.
Similar agreements in the history of the Sudanese North-South divide offer a Rosetta stone for guessing the probable outcome of the lastest deal and the current peace process: previous agreements have failed. In a way, the legal issue is but an illustration of the territorial borders issue that African leaders have so far failed to confront. The map of Africa-as-we-know it today has been determined in 1884-1885 by the agreements of European colonial powers. State borders thus doesn't reflect "national" nor cultural boundaries, but the balance of power between former western rulers whose views and interests have been confirmed in the ongoing post-colonial era: out of concern that new genuine national borders would bring new conflicts, the OAU (Organisation for African Unity) confirmed the status quo in 1963.
Boundaries of the "spheres of influence" became territorial and then state borders. Thus, the map that was drawn with no regard for historically as well as culturally and linguistically evolved identities became the de-facto political space of modern Africa. Many African "nations" (or groups of kinsmen) were split up. Others, enemies from time immemorial, were forced to live under the same regimes, sharing the same "country". As a matter of fact, the possibility of a territorial breakup of Sudan has been recently discussed by Hassan al-Turabi, the former deputy of the current leader of Sudan, General Bashir. Turabi interestingly states that the U.S.-backed agreement favours secession for the South. These words echo Marian Tupy's view. Beyond the legal and territorial obstacles lies the biggest issue of them all: the oil revenue sharing scheme.
Importantly, the Sudan peace plan does not address the long-term fate of the southern oil fields. Most of the country's 600 million barrels of oil reserves are in the south. Under the Naivasha agreement, the money from the sale of oil must be shared equally between the north and the south. So, what will happen to that agreement after the six-year interim period? There's every likelihood that the south will declare independence. The south had fought for independence for three decades and the interim period will not stifle the separatist sentiment. In addition, the prospect of benefiting from oil revenues without having to share them with the north will no doubt strengthen the appeal of southern independence. Similar feelings can, for example, be observed among the Yoruba and Ogoni people in Nigeria, who believe that they are not getting their share of oil revenues.
As you can see, Marian Tupy's commentary echoes the views held here at African Oil Politics. His conclusion is that the oil money is unlikely to solve Sudan's problems because of the oil curse - not to mention the conflict in the Darfur!
Monday, February 23, 2004
Sao-Tome: Study renews debate on US military base
The U.S. Trade and Development Agency (USTDA) gave more details about the study project we reported last week for Sao Tome port and airport facilities. The agency awarded two grants to the Ministry of Public Works, Infrastructure and Land Affairs of Sao Tome & Principe. The grants are described as follows:
The first grant, in the amount of $450,000, will fund a feasibility study on the development of a deepwater port on Sao Tome. The second grant, totaling $350,000, will fund technical assistance to assist with a development plan for Sao Tome’s airport. The grants represent the first investments by USTDA in Sao Tome & Principe... In particular, the USTDA-funded deepwater port study will review potential sites and identify the optimal location for the port, as well as make recommendations on its operation. The USTDA-supported technical assistance program will assist with the development of a strategy for the expansion and modernization of Sao Tome’s current airport facilities.
The USTDA press release doesn't say anything about the military base, but we know for a fact that the agency operates "at the nexus of foreign policy and commerce" and is no foreign to The White House African Policy. On the other hand, U.S. Ambassador Kenneth Moorefield who signed the agreement to study the possibility of developing a deep-water port and expanding the country's tiny airport, is also ambassador to Gabon - another African oilstate. Based on these pieces of information, analysts easily made the relevant connections. Alex Belida, from the Voice of America, did just that:
Pentagon officials remain tight-lipped about any possible plans they may have for Sao Tome. On Thursday, they dismissed questions about possible U.S. military access to any new port or airport facilities that might be developed on the island as hypothetical. But the Pentagon's interest is evident: last September, a top U.S. military commander told reporters Sao Tome is a potentially ideal site for one of the Pentagon's so-called Forward Operating Locations, bases available for temporary use by American forces in an emergency. Air Force General Charles Wald is deputy commander of the U.S. military's European Command, which is responsible for most of sub-Saharan Africa. He visited Sao Tome last year. He noted it is strategically located in the Gulf of Guinea, close to both west and central Africa, areas where U.S. forces have had to operate on occasion in the past, and might have to operate in the future. He also said it is in a region where stability is needed, especially as U.S. oil imports from West Africa grow.
During his latest anti-terror meeting with Thabo Mbeki, US General James Jones, the supreme commander of the U.S. military's European Command, sang his favourite mantra: "America sees Africa as a soft target for terror networks due to weak institutions, poor security and long stretches of unguarded coastline." The important words here are ungarded coastline. He already said two years ago that the military deal with Sao Tome would involve coast guards patrol training and capacity building. As African Oil Politics wrote few weeks ago, the growth of piracy activities in the Gulf of Guinea, especially in Nigeria, is the perfect rationale for a U.S.-backed military monitoring of the oil-rich area. Besides, as has been reported about the anti-terror meeting in South Africa:
Washington hopes to secure "forward operating locations" to enable it to react to security threats in Africa without setting up permanent bases, a US military source said. Officials have not confirmed reports that Washington is looking at sites in Mozambique and Sao Tomé and Principe off West Africa.
There won't be any official confirmation before the U.S. congress is handed the report that General James Jones and General Charles Ward are writing. Wait few more weeks. Stay connected.
Chad: oily courtship by U.S., China & France
Chad, one of the the poorest countries in the world, was an area where French interests remained paramount, though sometimes challenged by Lybia. Then, oil was discovered. American firms got rid of the French and built the Doba-Kribi pipeline, the largest private investment in Africa. The $3.7 billion underground pipeline stretches 670 miles and ferry crude oil to the Atlantic coast, through another France-influenced country: Cameroon. Oil began to flow in Oct. 2003, transforming the country into Africa's latest oilstate. Chad's new status brought attracted lots of attention from U.S. media as never before. The New York Times wrote lately:
Oil is bringing big changes to Chad, some cultural... like the way the World Bank will be overseeing how Chad manages its new wealth... Because the pipeline stands to transform this landlocked country, for better or worse, Chad is under a special glare — from the oil industry, global lending institutions and development groups. The investment has come with strings attached: the oil revenues are to be transparent, and the government is to use the wealth to better the miserable lives of its nine million citizens. A citizens' committee is to review all spending to see that it conforms to the law.
All this attention doesn't change the nature of the regime: when handed its a $25 million "signing bonus" four years ago, the regime spent the first chunks on essential poverty reducing-mesures such as buying arms and refurbishing ministers' offices. In case more oil is discovered in the country, the regime would certainly welcome a differnt kind of investors. Why not China?
the state-owned China National Petroleum Corp. (CNPC) had just signed a major oilfield deal with the central African country of Chad and was very likely to launch oil prospecting there from November this year. The bold step of conducting oil exploration in the country was made just as the largest Chinese land oil producer had listed Chad along with neighboring Niger as its focus for tapping oil resources in Africa this year... The Chinese company is considering pursuing more oil interests in neighboring Chad and Niger now, as a major anticline structure traversing the three countries is believed to be a potential oil and gas bonanza. As Interfax previously reported, CNPC was awarded the oil prospecting rights for the exploration of two blocks, the Tenere and Bilma, in Niger last November and signed a deal concerning the rights with the Nigerois Ministry of Mining and Energy.
After Hu Jintao's latest trip to African oilstates Gabon, Algeria and Egypt, China's intentions towards African oil are thus confirmed. In order to remind Chad of its presence in the country, France allocated 4 million euros to the Chadian "energy sector" through its aid agency AFD. A security assisance deal already links Chad and France: 950 French troops are positionned in the Kossei military base.
Oil reserves: SEC probes Shell while Exxon smiles
The mood is gloomy at Shell: US Securities and Exchange Commission launched a formal investigation after the company decided last month to cut its estimated oil and gas reserves by 20 percent. The company was already facing a major PR backlash because of the way the chairman, Philip Watts, managed the issue. This formal probe will only hasten full disclosure and a greater oversight of the firm's corporate structure.
The revision occurred in part because Shell had classified oil and gas in some of its Nigerian and Australian projects as "proven" in the late 1990s, even before the fields were developed. Watts was head of Shell's exploration and production unit... and was responsible for classifying reserves.
In the 1990's, Philip Watts was in charge of the subsidiary in Nigeria. Part of the explanation for Shell's reserves downgrade has to do with the financial incentives offered by Nigerian authorities to oil firms that could show reserve bonus. Shell failed to disclose these incentives, until it could not hide them anymore: between 1991 and 2001, Nigerian authorities had, introduced fiscal incentives to encourage companies to devote funds to oil exploration. It was a way of using fiscal measures to gear up exploration among oil companies. But Shell didn't reported these incentives over new discoveries to investors and regulatory authorities in the United States and Britain. The market was furious. The Financial Times reported earlier this month that Nigeria accounted for about a third of 3.9 billion proved reserves, thus making the country the largest contributor to the slashed reserves. Other industry sources say "natural gas was a big factor in Shell's misjudgement in prematurely booking some of Nigeria's oil and gas fields that are ready for development between 1996 and 2002".
Since then, several oil and gas companies, including Houston-based El Paso Corp. have cut their assessments of reserves. Amid this increased investor scrutiny of reserves as well as the U.S. market regulator's formal investigation into RoyalDutch Shell Group, ExxonMobil remains upbeat: the world's largest publicly traded oil company announced that "it added the equivalent of 1.7 billion barrels of oil to its reserves in 2003 as additions exceeded production for a 10th straight year. Proven reserves [jumped] to 22 billion barrels of oil equivalent on Dec. 31... The company said its oil and gas holdings would take 14 years to exhaust at current production pace."
The revision occurred in part because Shell had classified oil and gas in some of its Nigerian and Australian projects as "proven" in the late 1990s, even before the fields were developed. Watts was head of Shell's exploration and production unit... and was responsible for classifying reserves.
In the 1990's, Philip Watts was in charge of the subsidiary in Nigeria. Part of the explanation for Shell's reserves downgrade has to do with the financial incentives offered by Nigerian authorities to oil firms that could show reserve bonus. Shell failed to disclose these incentives, until it could not hide them anymore: between 1991 and 2001, Nigerian authorities had, introduced fiscal incentives to encourage companies to devote funds to oil exploration. It was a way of using fiscal measures to gear up exploration among oil companies. But Shell didn't reported these incentives over new discoveries to investors and regulatory authorities in the United States and Britain. The market was furious. The Financial Times reported earlier this month that Nigeria accounted for about a third of 3.9 billion proved reserves, thus making the country the largest contributor to the slashed reserves. Other industry sources say "natural gas was a big factor in Shell's misjudgement in prematurely booking some of Nigeria's oil and gas fields that are ready for development between 1996 and 2002".
Since then, several oil and gas companies, including Houston-based El Paso Corp. have cut their assessments of reserves. Amid this increased investor scrutiny of reserves as well as the U.S. market regulator's formal investigation into RoyalDutch Shell Group, ExxonMobil remains upbeat: the world's largest publicly traded oil company announced that "it added the equivalent of 1.7 billion barrels of oil to its reserves in 2003 as additions exceeded production for a 10th straight year. Proven reserves [jumped] to 22 billion barrels of oil equivalent on Dec. 31... The company said its oil and gas holdings would take 14 years to exhaust at current production pace."
DiamondWorks' projects in Mozambique & Nigeria
Petrolplus Africa, a subsidiary of Vancouver-based Canadian resources firm DiamondWorks Limited, is conducting a feasibility study for the oil pipeline from Mozambique’s seaport of Nacala to Liwonde. Wilfred Ali, project coordinator for the Nacala Development Corridor (NDC), expects a survey report before the close of the year.
the pipeline, which sources say will cost close to US$1billion, is expected to reduce transport costs which are largely driven by import costs for oil... The 400 km oil pipeline is crucial to Malawi’s aspirations in the Nacala Development Corridor (NDC), a spatial development with Mozambique and Zambia. [Signed in May last year,] Petrolplus Africa’s agreement with the Malawi government mandates the firm to carry out a feasibility study of the pipeline project and if found viable, put up infrastructure in return for fuel supply contracts.
Energem Petroleum, another subsidiary of DiamondWorks, has entered into a deal with Yinka Folawiyo & Sons Ltd. of Nigeria to set up a gasoline and oil products storage and distribution business.
The two companies will operate an oil products receiving, storage and distribution depot with a monthly capacity of 150,000 tonnes in the deep water port in Lagos, Nigeria's capital. DiamondWorks said the project will cost about $10 million US and will be the only privately owned depot in Nigeria capable of receiving, storing and distributing full cargos of petroleum products for distribution into the Nigerian petroleum market, the largest in Africa.
DiamondWorks is best known as a diamonds mining company operating in West Africa (Angola, Central African Republic, Sierra Leone). As for Yinka Folawiyo, it is one of the largest and most diversified conglomerates in Nigeria, with business ventures in construction, energy, shipping, agricultural products, fishing and financial services.
Friday, February 20, 2004
Fridayblog: blogging for change in Africa
I haven't been much involved into debates this week, being very busy with my own research and working on the evolution of African Oil Politics. But I must report two interesting initiatives that indicate a likely path for bringing change to the continent through digital technology and communication skills.
The first initiative takes place in Nigeria: antigraft.org is a website built by guys from the Anti corruption Internet Database (ACID) with the aim of creating a tool that "informs, educates and keeps data about corruption in Nigeria and other parts of the world". And it delivers, believe me. Of particular interest is the corruption news feed that updates every 6 hours, with lots of stories "on corruption, fraud, money laundering, and related issues". Now, I can pretty well how blogging could impact such a site: a group of dedicated citizen journalists would report not stories they have read in the press, but fished with those who have witnessed first hand cases of corruption and bribery. Imagine that you can connect to the antigraft hotline with your cellphone, send short messages (sms) that would be then published after proper editing. That's what I call a one-stop corruption boutique, with early warning functions!
The second initiative is a follow-up to my discussion with Akwe and Ethan about bringing "High profile bloggers" online. Akwe reported that K.Y. Amoako, the head of the UN's Economic Commission for Africa, has just launched his own blog. That's a remarkable achievement, given the fact that African officials are usually techno-shy and resist accountability. As a matter of fact, our discussion is about how blogging can be "a potentially powerful tool of accountability and change". Akwe argues that when "setting out to reflect on things in public, bloggers agree to be held to account for what they say"; her conclusion is that the "decision to be open" is what makes the difference. I agree, but I don't think that blogging by itself constitutes a strong commitment to openness and change. In the future, when blogging becomes more widespread among African leaders, the ultimate test for assessing accountability will lie in the ability of a "high profile blogger" to allow his visitors to feedback and comment upon his posts. It's easy putting a blog online; it's more difficult to accept being challenged by laypersons. Walking the talk, I then visited Amoako's blog - which is not only good, but better designed and written than Jimmy Carter's one. Once there, I decided to challenge the openness: I sent two short thought-provoking comments of my own. I hope he will pick on this and accept discussing his views. But I must admit that the guy is smart and sounds cool. I'll tell how it turns out. Hey, I found a new job: digital challenger of "high profile bloggers".
World Bank: from rhetoric to arrogance
The World Bank is under attack for the way it's handling the conclusions of the Extractive Industries Review process it had initiated. Caspar Henderson's latest post on OpenDemocracy offers a balanced analysis of of the debate. His conclusion represents a good contribution to the debate about (digital) democracy and civil society participation to economic decision making:
Innovative NGOs and disruptive social entrepreneurs ... together with new forms of regulation, are likely to be necessary to constraint corporate power. That means a new politics, all the more needed as the World Bank’s rhetoric, and action, to redress inequality is ever less in accord with the concerns of the United States administration.
Thursday, February 19, 2004
Who owns Nigerian crude?
Nigerians are currently busy thinking about the problems that oil and gas brought to the country. Ugochukwu Ejinkeonye writes an op-ed article in Vanguard that's worth reading because it reflects the views of part of Nigerian intellectuals:
It has indeed become too evident that the greatest obstacle to Nigeria's economic and political and even social survival today is, perhaps, the oil which this country has in abundance. This is most painful because, God who blessed us with abundant oil intended it to be a great blessing to us as a nation. But unfortunately, due to gross failure of leadership and character, we have most willingly turned it into our collective undoing... Oil has polluted our politics. When you see politicians killing each other to gain political power, they are all being motivated by the lure and charm of oilâ-oethe commodity that rewards idle men at the expense of the hard working ones. Nigeria is the only place where the sole job of the President is just to give out money. Every month, states and local governments file up to receive their share. So long as oil is flowing, no matter how bad it is, all the 'elected' people will remain confident that their salaries and 'allowances' are intact.
This moral as well as religious view on the local politics of oil is matched by the hope of other writers who think otherwise: they believe that the monitoring body set up by Obasanjo, the National Stakeholders’ Working Group, might actually help correct the oil curse. The stated goal of the monitoring group is "to deter bribery and graft within a sector which is reputedly rife with illegal commissions on contracts, large-scale theft and lax environmental controls".
Olusegun Adeniyi, the only member of the new body who is a journalist, as written a personal account of his involvement in the initiative that his grounded in a clear view of what is at stake: "This initiative is rather important given the fact that majority of Nigerians are agreed today that only a small percentage of the population enjoy the proceeds of our oil while many more still believe we are being shortchanged by the multinational oil companies and their local collaborators. There have indeed been series of evidence to back these perceptions." He then goes on to outlines petroleum revenue transparency issues such as bonuses, royalties, profit taxes, or production shares. The op-ed, which starts on a rather sceptical vision ends on an upbeat tone:
At least with the NSWG in place, we now have an idea of who actually owns Nigerian Crude hence no fat cat in NNPC will ever again have the gut to run a N245 million hotel bills in NICON-Hilton. That era is gone and, to adopt the words of President George Bush on Saddam Hussein's Iraq....it will not be coming back!
Time will tell... But I'm personally grateful to the author for giving the URL of a Nigerian digital transparency initiative called antigraft. I think I'll get in touch with these guys and let you know what's up down there.
It has indeed become too evident that the greatest obstacle to Nigeria's economic and political and even social survival today is, perhaps, the oil which this country has in abundance. This is most painful because, God who blessed us with abundant oil intended it to be a great blessing to us as a nation. But unfortunately, due to gross failure of leadership and character, we have most willingly turned it into our collective undoing... Oil has polluted our politics. When you see politicians killing each other to gain political power, they are all being motivated by the lure and charm of oilâ-oethe commodity that rewards idle men at the expense of the hard working ones. Nigeria is the only place where the sole job of the President is just to give out money. Every month, states and local governments file up to receive their share. So long as oil is flowing, no matter how bad it is, all the 'elected' people will remain confident that their salaries and 'allowances' are intact.
This moral as well as religious view on the local politics of oil is matched by the hope of other writers who think otherwise: they believe that the monitoring body set up by Obasanjo, the National Stakeholders’ Working Group, might actually help correct the oil curse. The stated goal of the monitoring group is "to deter bribery and graft within a sector which is reputedly rife with illegal commissions on contracts, large-scale theft and lax environmental controls".
Olusegun Adeniyi, the only member of the new body who is a journalist, as written a personal account of his involvement in the initiative that his grounded in a clear view of what is at stake: "This initiative is rather important given the fact that majority of Nigerians are agreed today that only a small percentage of the population enjoy the proceeds of our oil while many more still believe we are being shortchanged by the multinational oil companies and their local collaborators. There have indeed been series of evidence to back these perceptions." He then goes on to outlines petroleum revenue transparency issues such as bonuses, royalties, profit taxes, or production shares. The op-ed, which starts on a rather sceptical vision ends on an upbeat tone:
At least with the NSWG in place, we now have an idea of who actually owns Nigerian Crude hence no fat cat in NNPC will ever again have the gut to run a N245 million hotel bills in NICON-Hilton. That era is gone and, to adopt the words of President George Bush on Saddam Hussein's Iraq....it will not be coming back!
Time will tell... But I'm personally grateful to the author for giving the URL of a Nigerian digital transparency initiative called antigraft. I think I'll get in touch with these guys and let you know what's up down there.
New peace prospects in Sudan
The United States made important steps in the last three weeks that are likely to influence favorably the peace process in Sudan. First, Colin Powell cut a deal with French FM Dominique de Villepin: the State Department would reverse its opposition to sending some 6,000 United Nations peacekeepers to Ivory Coast if France backs the U.S. plan to send a UN peacekeeping force to Sudan.
The deal allowed John Negroponte to announce that the Bush administration had asked Congress to authorise the move after opposing it on budgetary grounds:"The US pays 27% of the UN's peacekeeping budget and correspondents say the force is likely to be approved on 27 February, when the mandate of the current UN team and the French and African peacekeepers expires." The U.S. U-turn on the Ivoirian case is behind the current Villepin's diplomatic intervention in the Darfur crisis. Visiting Chadian President Deby today and Sudanese leader Bachir tomorrow, Villepin will add French (waning) influence in the region to the (growing) pressure of the United States on his new clients:
Call off your troops and militias in the west, or expect no peace dividend for an agreement with the south. US State Department sources say this was the message carried to Khartoum last week by a high-level American delegation headed by Charles Snyder, acting assistant secretary of state for African affairs. Snyder reportedly warned Khartoum that the US would not lift sanctions against Sudan, and the “troika” mediating the north-south talks the US, Britain and Norway would not fund a new era of peace with the SPLA as long as the war in Darfur rages unabated. If confirmed, and if translated into meaningful pressure at the north-south talks that resumed in the Kenyan town of Naivasha on Tuesday, the new tough line with Khartoum may mark the end of a year in which the US administration turned a blind eye to the war in Darfur in its eagerness to score a foreign policy success in the south.
All these developments show how important the Sudan peace process is for Bush. In fact, the Lybian drama and the Sudanese peace process are his biggest hopes for showing a breakthrough on the international front. After Angola and Liberia, a complete peace in Sudan and a tamed Lybia would constitute key victories for the U.S. administration. The African front would prove that Bush is really the (oil) war (on terror) President.
The deal allowed John Negroponte to announce that the Bush administration had asked Congress to authorise the move after opposing it on budgetary grounds:"The US pays 27% of the UN's peacekeeping budget and correspondents say the force is likely to be approved on 27 February, when the mandate of the current UN team and the French and African peacekeepers expires." The U.S. U-turn on the Ivoirian case is behind the current Villepin's diplomatic intervention in the Darfur crisis. Visiting Chadian President Deby today and Sudanese leader Bachir tomorrow, Villepin will add French (waning) influence in the region to the (growing) pressure of the United States on his new clients:
Call off your troops and militias in the west, or expect no peace dividend for an agreement with the south. US State Department sources say this was the message carried to Khartoum last week by a high-level American delegation headed by Charles Snyder, acting assistant secretary of state for African affairs. Snyder reportedly warned Khartoum that the US would not lift sanctions against Sudan, and the “troika” mediating the north-south talks the US, Britain and Norway would not fund a new era of peace with the SPLA as long as the war in Darfur rages unabated. If confirmed, and if translated into meaningful pressure at the north-south talks that resumed in the Kenyan town of Naivasha on Tuesday, the new tough line with Khartoum may mark the end of a year in which the US administration turned a blind eye to the war in Darfur in its eagerness to score a foreign policy success in the south.
All these developments show how important the Sudan peace process is for Bush. In fact, the Lybian drama and the Sudanese peace process are his biggest hopes for showing a breakthrough on the international front. After Angola and Liberia, a complete peace in Sudan and a tamed Lybia would constitute key victories for the U.S. administration. The African front would prove that Bush is really the (oil) war (on terror) President.
US-E.Guinea: unreported deals
Vicky Bailey, the current U.S. Assistant Secretary for Policy and International Affairs at the Department of Energy, was last week in Malabo (Equatorial Guinea). During her visit (February 8-11), she met the Guinean minister of energy, Cristobal Menana Ela, and the strongman of the country, President Teodoro Obian Nguema. The United States and Equatorial Guinea signed three bilateral cooperation deals focusing on energy activities (oil and gas), technology transfer and human resources (training).
George Staples, U.S. ambassador to Cameroon and Equatorial accompanied the American delegation. Equatorial Guinea is the third biggest sub-saharan oil producing country, after Nigeria and Angola. Almost two thirds of its hydrocarbon production is sold to the United States. The biggest oil firms operating in the country as American companies: ExxonMobil, Chevron-Texaco or Triton-Hamerada. Equatorial Guinea is so important for the United States and the growth of US private investment in the country so rapid since 1996, that the United States re-opened an embassy in Malabo less than five months ago, in October 2003.
Given the profile of such a country (known now as “the Kuwait of Africa”), not to mention the roles of Vicky Bailey and George Staples, I wonder why American media failed to report this visit that was announced (at least) in France, Spain and China. Is it because the visit took place during a dangerous political crisis in Equatorial Guinea, a country caught in a “murky power struggle” since December 2003? Is it because the power struggle is leading to “mysterious army movements”? Or is it because of the paranoia of the President, who asked his followers to be vigilant, to lookout for possible danger, and “monitor everybody, locals as well as foreigners, and report all movements, all activities designed to destabilize the country”?
I guess the goal of this information blackout (of an important African oil policy issue) is to avoid giving mixed signals to the U.S. public opinion in an election year – both in the United States and Equatorial Guinea.
The hearts & minds of darkness
The more I work on this blog, the more I tend to think that the basic rationale behind the growing U.S. engagement in every corner of Africa has a kind of philosophical meaning to it: when compared to the absolute lack of security of African populations, the U.S. quest for absolute security, summarized in code words like "energy security" and "war on terror", bears the grinning face of arrogance.
The Africans' absolute lack of security is made even worse by the fact that globalization helps give absolute power to those who are the most to blame for the current situation of African populations: private corporations, private networks of special interests (lobbies) linked to local autocratic rulers (so-called leaders) whose vision of "governance" has nothing to do with democracy (government of the people, by the people, for the people) and everything to do with tyranny: African elites share the same un-democractic values that are the hallmark of the current U.S., French or Russian regimes. Their dream of unchecked, unaccountable and non-transparent power is the complete anti-thesis of what people living in the internet age should be about.
The pathological quest for security, power and profit is what tie together western elites, African rulers and private transnational corporations. They share the same world-view and "personality": they are irresponsible because they put everything at risk in the attempt to satisfy their goal of absolute security, power and profit. They usually "refuse to accept responsibility for their own actions and are unable to feel remorse". Those who care for the evolution of the world as we know it and for the future of Africa have a lot to learn from the people who are running what I call the "oil war on terror": "This is a dynasty bringing in all the old retainers and the people who represent various interest groups and geopolitical commitments."
Corruption is the word that best describes the confusion between pubic authority and private interest: the lack of democracy in Africa goes hand in hand with the lack of social corporate responsibilty. African populations are already used to that state of things: Americans are slowly discovering where the current corruption of their admnistration lead them. Having an Halliburton-State is no better than an Elf-State or a Shell-State. U.S. administration is going the way of the French in Africa. Corruption always comes home to rest! The Middle East legacy is the added bonus of their coming late to the game : welcome in the heart of darkness.
Wednesday, February 18, 2004
US-China: the next oil war?
After Chinese leader Hu Jintao visited three oil exporting African countries (Gabon, Algeria, Egypt), analysts described the energy relations between China and Africa as an illustration of the coming US-China resource war. The visit was seen as a threat to the United States’ oil interests because China “imported more than 100 million tonnes of oil last year, over 30 per cent higher than it did in 2002”. Such views are not new, but their main interest lies in the hidden assumptions they carry about Africa and the superpowers' battle to grab it. Africa is viewed as an object - not an actor of its own history: it's a piece of real estate that is “up for grab”, up for sale. This view, that hold true for the behaviour of African leaders such as Bongo, Bouteflika and Mubarak, ignores those like Ken Saro-Wiwa who struggle(d) and resist(ed) the corporate takeover of the continent. Beside, in order to show how morally superior Americans are, US sensitiveness to human rights violations and corporate social responsibility are over-highlighted. The reality is of course less rosy: Equatorial Guinea’s appalling human rights record has not been an obstacle when the United States decided to re-establish an embassy there few months ago, in October 2003.
More intersting are analysts like Gal Luft who stretch the US-China resource war thesis quite far. So far that he has to come up with a solution to avoid an all out oil-war. According to him, the United States should initiate a new dialogue with the Chinese authorities, in order to:
With 1.3 billion people and an economy growing at a phenomenal 8 percent to 10 percent a year, China, already a net oil importer, is growing increasingly dependent on imported oil... Without a comprehensive strategy designed to prevent China from becoming an oil consumer on a par with the United States, a superpower collision is in the cards. The good news is that we are still in a position to halt China's slide into total dependency. Unlike the United States, China's energy infrastructure is largely underdeveloped and primarily coal-based. It has not yet invested in a multibillion-dollar oil infrastructure. China is therefore in a better position than the United States to bypass oil in favor of next-generation fuels. The United States should embark on a frank dialogue with China, conveying to the Chinese the mutual benefits of circumventing oil and offering any assistance required to curb China's growing appetite for it. A shift from oil into other sources of transportation energy -- such as bio-fuels or coal-based fuels, hydrogen and natural gas -- could prevent future conflict and foster unprecedented Sino-American cooperation with significant economic benefits for both countries.
While a bit over-optimistic, Gal Luft's idea is not uninteresting. The main problem on the road ahead that he maps is that such a partnership already exists:
The International Partnership for the Hydrogen Economy (IPHE) creates a mechanism to organize and implement effective, efficient, and focused research, and to develop and deploy activities that advance hydrogen and fuel cell programs. The coordination instituted through the IPHE will leverage limited resources and bring together the worlds best intellects and talents to solve difficult challenges to making the hydrogen economy a reality. The IPHE will foster the implementation of cooperative efforts to advance research, development, demonstration and commercial use of hydrogen production, storage, transport and distribution. The IPHE will also enhance collaboration on fuel cell technologies, common codes and standards for hydrogen fuel utilization, and help to coordinate international efforts to develop a global hydrogen economy.
IPHE involves The U.S., EU, China, India, Japan and so on. Whereas the partnership has somehow become a reality, Hu Jintao's recent trip to Africa is an indication that "a superpower collision" over african oil remains in the cards.
....................................................................
More intersting are analysts like Gal Luft who stretch the US-China resource war thesis quite far. So far that he has to come up with a solution to avoid an all out oil-war. According to him, the United States should initiate a new dialogue with the Chinese authorities, in order to:
With 1.3 billion people and an economy growing at a phenomenal 8 percent to 10 percent a year, China, already a net oil importer, is growing increasingly dependent on imported oil... Without a comprehensive strategy designed to prevent China from becoming an oil consumer on a par with the United States, a superpower collision is in the cards. The good news is that we are still in a position to halt China's slide into total dependency. Unlike the United States, China's energy infrastructure is largely underdeveloped and primarily coal-based. It has not yet invested in a multibillion-dollar oil infrastructure. China is therefore in a better position than the United States to bypass oil in favor of next-generation fuels. The United States should embark on a frank dialogue with China, conveying to the Chinese the mutual benefits of circumventing oil and offering any assistance required to curb China's growing appetite for it. A shift from oil into other sources of transportation energy -- such as bio-fuels or coal-based fuels, hydrogen and natural gas -- could prevent future conflict and foster unprecedented Sino-American cooperation with significant economic benefits for both countries.
While a bit over-optimistic, Gal Luft's idea is not uninteresting. The main problem on the road ahead that he maps is that such a partnership already exists:
The International Partnership for the Hydrogen Economy (IPHE) creates a mechanism to organize and implement effective, efficient, and focused research, and to develop and deploy activities that advance hydrogen and fuel cell programs. The coordination instituted through the IPHE will leverage limited resources and bring together the worlds best intellects and talents to solve difficult challenges to making the hydrogen economy a reality. The IPHE will foster the implementation of cooperative efforts to advance research, development, demonstration and commercial use of hydrogen production, storage, transport and distribution. The IPHE will also enhance collaboration on fuel cell technologies, common codes and standards for hydrogen fuel utilization, and help to coordinate international efforts to develop a global hydrogen economy.
IPHE involves The U.S., EU, China, India, Japan and so on. Whereas the partnership has somehow become a reality, Hu Jintao's recent trip to Africa is an indication that "a superpower collision" over african oil remains in the cards.
....................................................................
Pan Sahel Intiative: U.S. trains Mali troops
Last month, I reported how the United States is expanding anti terror efforts to the remote reaches of West Africa's Sahara borders in Mauritania, Mali, Niger and Chad. The small team of experts that arrived in Mauritania has been followed by other units and private defense contractors who are now operating in Mali.
U.S. military experts have beguntraining soldiers in Mali to tighten border controls on the fringes of the Sahara desert, where Washington fears Islamic militants could be moving along ancient trade routes. Three U.S. teams aretraining units in the capital Bamako, the eastern town of Gao and the desert city of Timbuktu to combat arms trafficking and banditry in the north, Mali's chief military spokesman, Abdoulaye Coulibaly, said on Tuesday. "We've selected three units -- one at Timbuktu, one at Gao and one based in Bamako, each one with around 100 members," he said. Around 10 U.S. experts are training each unit. The support, which includes around 40 off-road vehicles and communications equipment, is part of a U.S. scheme to help four nations on the southern edge of the Sahara -- Mali, Mauritania, Niger and Chad -- combat security threats.... But some diplomats say there is no firm evidence of al Qaeda penetration in the region and critics argue some West African leaders deliberately play up the threat to get their hands on Western cash and military know-how.
Al Qaeda's presence may be a fiction; but this useful fiction will help the low-profile spread of U.S. security initiatives away from U.S. european bases and NATO deployments at east Africa's Horn of Africa. With Mali and Niger, Mauritania makes up a triangle of countries whose border with Algeria has been used in the past by Touareg rebels fighting the regime in Bamako, by Algerian islamists, looters, kidnappers and bandit groups mixed with Islamic extremists.
Providing 60 days of military training within the four nations, the underfunded Pan-Sahel Initiative is coaching host countries' troops in everything from desert navigation to small-unit infantry tactical skills. The initiative also provided Toyota Land Cruisers, radios, and uniforms for the border efforts in these largely poor countries. U.S. troops are to do the work in Mauritania and Mali; contractors of Los Angeles-based Pacific Architects & Engineers in Chad and Niger. As usual, the presence of these contractors has been underreported. A quick research in my database allows me to give you some background details about the private company that has been subscontracting logistical as well as training operations to the U.S. army in West Africa in the 1990's and today:
In addition to providing logistical support to deployed African forces, contractors are also starting to play significant roles in supporting, or providing logistical support to deployed U.S. forces, particularly in the context of U.S. forces preparing African soldiers for deployment to PKO missions elsewhere. An example of that is Operation Focused Relief, which took place in three different countries, Senegal, Ghana, and Nigeria. All three training operations were supported by PAE contractors. PAE provided commercially available military and commercial equipment, including vehicles, communications gear, uniforms, soldier equipment, medical supplies, again, ground power, fuel, water, and trailers. They also assisted in the shipment of weapons and ammunition for the training to include both individual and crew served weapons. They arranged for commercial shipping, they built base camps and provided complete logistical support to the deployed U.S. trainers. So in the Operation Focus Relief case, the contractor was supporting both U.S. trainers, and the African troops that we were training.
More recently, the same company operated in Liberia: the US hired Pacific Architects and Engineers to provide logistics for the Nigerian security force in charge of peacekeeping after the departure of President Charles Taylor. This improves their knowledge of the region, which improves their chances for getting a new deal and pretty much soon, you've got a well trained private army that can be useful to any West African autocrat who has good oily relations with Washington.
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The Horn of Africa: a containment lab
In order to fight the new war on terror, the U.S. is experimenting new models in the Horn of Africa - a region that covers the total airspace and land areas of Kenya, Somalia, Sudan, Eritrea, Djibouti, Yemen and Ethiopia as well as the coastal waters of the Red Sea, Gulf of Aden and Indian Ocean. The requirements of the Combined Joint Task Force-Horn of Africa, whose Headquarters are located at Camp Lemonier (Djibouti) represents a challenge for the troops as well as for the African allies of the United States. The role of the troops is to win "hearts and minds" through humanitarian projects:
U.S. troops moved into the [Djibouti] post in summer 2002 to stem any terrorist flow out of Afghanistan. “I think our goal has gone from protecting the flank and catching the bad guys from Afghanistan to assisting the states in the region to fight the terrorist threat that’s already existing,” said Marine Lt. Col. Walter Lundin, head of the task force’s plans division.... “We don’t want to change their culture, we just want to make them less susceptible for terrorist cells to operate among them, increase their quality of life so they’ll say, ‘No, we like the Americans,’ ” said Capt. Jeremy Rose, 29, a civil affairs team leader from Dayton, Ohio. “We’re spreading a pro-U.S. sentiment by increasing our area of influence.”
As for the allies, Americans ask them to share intelligence, cooperate with their neighbours - who sometimes happen to be their longtime enemies:
U.S. Central Command chief General John Abizaid urged East Africa on Monday to share intelligence information to defeat any attempts by militants to operate in the region. Abizaid was speaking after meeting Ethiopian Prime Minister Meles Zenawi and top defence officials in the Horn of Africa country, which Washington views as a key ally in its war on terrorism. "The level of cooperation in the region must be strengthened," Abizaid, U.S. forces' Middle East Commander, told a news conference in the capital Addis Ababa at the end of his one-day visit."It does not do any good to have only bilateral relations, such as Kenya-U.S., Ethiopia-U.S., Djibouti-U.S. In this region it is very important that we share important information from a regional perspective and in as collective a manner as we can. The terror threat knows no boundary."
The centrality of culture is one of the major challenge America is discovering, both inside the troops and the host countries. All these people are cogs in a wheel nobody seems to really manage.
US military: new realignment, new containment
Thomas Barnett’s book will be released in April. It will be highly debated and commented. Trying to stay true to this blog’s mission (forward-looking views on oil politics and energy security issues), I advise you to start reading some of the articles he published in the last three years on his website. I won’t elaborate now on his ideas; we’ll have plenty of time to discuss them later. The only question that matters today is that one: why is Thomas Barnett relevant to African oil politics? Simply put, because he’s one the rare thinkers and strategists who really understands what thinking globally means – taking a multi-disciplinary approach to the issues of the day. I certainly don’t share all his views – that’s beyond the point. But he’s more stimulating that a lot of people I agree with if they weren’t so mono-dimensional. His perspective is already being felt on American foreign policy (yes, you’re coming closer baby). The right time to read him in NOW, because an event of historic magnitude will occur in the coming weeks:
The United States will present its first specific plans in the coming weeks on its historic shift of troops... "By the end of March, we will have a fairly complete picture"... Air Force Major General Jeffrey Kohler, EUCOM’s chief liaison for the realignment of US troops, said the information would include a list of countries where the United States would like to establish facilities... "We may start some implementation this summer," he said... The US... has already established a forward operating location in Gao, Mali ... described as a ‘concrete and metal lean-to’ that could be built in as little as three weeks at minimal cost. Air Force General Charles Wald, deputy commander of EUCOM, said he hoped European allies in NATO would also make use of the new facilities to respond to threats in ‘an arc of instability’ ranging from the Caucasus through the Middle East to the Gulf of Guinea in West Africa.
What does THIS mean for Africa http://www.axisoflogic.com/artman/publish/article_5165.shtml? Those who regularly visit this blog probably have an idea by now: you’ll see American bases at least in four African regions:
- The Horn of Africa to fight Middle East terror and restore peace in the region (Djibouti, Somalia, Eritrea, Ethiopia, Sudan);
- The Sahel to protect porous borders from North African terror (Mauritania, Algeria), secure refuelling base to the air force (Mali, Uganda) and oversee security in unstable new oil producing countries (Niger, Sudan, Chad);
- North Africa to protect transit chokepoints in the Med (Egypt, Morocco, Tunisia) as well as oil and gas reserves (Algeria, Libya)
- West Africa to protect oil & gas reserves and secure Atlantic traffic against piracy and terrorism (Nigeria, Sao Tome, Equatorial Guinea, Ghana, Liberia, Senegal).
Simply put, the goal is to “contain” the arc of instability; and Africa is in the eye of the vortex.
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EUCOM vision of West Africa: oil & terror
While African security officers were being lectured on anti-terrorism at the Africa Center for Security Studies in Washington D.C., U.S. ambassadors operating in 15 West African countries were being taught other lessons in Stuttgart (Germany), at the U.S. European Command: the week-long seminar was about EUCOM and how it can best work with U.S. ambassadors in West Africa on peacekeeping operations. The EUCOM officer in charge of the seminar, Navy Capt. Stephen Ross, Africa division chief for EUCOM plans and policy directorate, has been straight-forward about U.S. engagement in the region:
Ross said that, in general, the ECOWAS nations are rich in natural resources and that the U.S. reliance on their resources will be growing in the next decade. He said that until the Sept. 11, 2001, terror attacks, Africa and many other regions had been forgotten. They are now getting more attention as terrorist cells have been rooted out in the Middle East and have moved to parts of Africa.
These various coordination plans and initiatives are unmistakable signs of things to come: the U.S. engagement in Africa will be driven by security issues – enegery security and war on terror. Americans want to protect their oil-based civilisation and their lives from the dangers coming from the “arc of instability”. In so doing, they tend to import their own problems to a continent that has its own share of unresolved problems: oil politics is the place where key issues and dynamics (economy, diplomacy, security, demography, resource scarcity) come together. Given the complexity of such a landscape, I’m often amazed by the linearity of some solutions Americans come up with. I’m a bit shocked that the “attention” the continent is getting looks so clearly power-political - selfish. A situation that offers so much opportunity for a win-win (African development and U.S. national security) is getting biased in favour of one player, partly because African leaders who work for their people are few. It’s too easy blaming Americans: at least, they are open about their intentions and objectives. Thank you, Capt. Ross.
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Ross said that, in general, the ECOWAS nations are rich in natural resources and that the U.S. reliance on their resources will be growing in the next decade. He said that until the Sept. 11, 2001, terror attacks, Africa and many other regions had been forgotten. They are now getting more attention as terrorist cells have been rooted out in the Middle East and have moved to parts of Africa.
These various coordination plans and initiatives are unmistakable signs of things to come: the U.S. engagement in Africa will be driven by security issues – enegery security and war on terror. Americans want to protect their oil-based civilisation and their lives from the dangers coming from the “arc of instability”. In so doing, they tend to import their own problems to a continent that has its own share of unresolved problems: oil politics is the place where key issues and dynamics (economy, diplomacy, security, demography, resource scarcity) come together. Given the complexity of such a landscape, I’m often amazed by the linearity of some solutions Americans come up with. I’m a bit shocked that the “attention” the continent is getting looks so clearly power-political - selfish. A situation that offers so much opportunity for a win-win (African development and U.S. national security) is getting biased in favour of one player, partly because African leaders who work for their people are few. It’s too easy blaming Americans: at least, they are open about their intentions and objectives. Thank you, Capt. Ross.
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Anti-terror 101: US security pundits lecture African officials
During the Africa Center for Strategic Studies’ latest Senior Leader Seminar, American security pundits have been lecturing 120 senior African security officers about the war on terrorism. American speakers basically sang their anti-terror mantra, trying the best they can to present it as an African problem: "Africa has been, is now, and will be into the foreseeable future ripe for terrorists and acts of terrorism," Department of Defense official Vincent Kern declared. I guess that’s DoD’s way to beat the freak fearful Africans out: Al Qaeda will come after you, boooo... How scary! If all this sounds a bit patronizing to you, don’t take it personally; at least, not before you read this:
While equipment and training are an important part of U.S./African security partnerships, Kern told his audience: "We need to continue to listen to Africans as we develop initiatives and responses" to the threat of international terrorism. "I think we have done a good job so far, but we need to guard carefully against trying to dictate to our friends and allies in Africa."
That wise declaration was followed by an overview of U.S. Africa-focused anti-terror initiatives that I already wrote about here: the Combined Joint Task Force for the Horn of Africa (CJTF-HOA) and The Pan-Sahel Initiative (PSI). If Kern’s gospel wasn’t enough – after all, he’s “only” a special assistant to the deputy assistant secretary of Defense for stability operations - a bigger fish stepped on the microphone to hammer the same message.
Carl Fulford, who is now ACSS director said, "It is a declaration of our commander in chief [President Bush] that [terrorism] is of top importance." Therefore, he said, "pushing anti-terrorism as an element of security strategy" has become an important part of the ACSS training syllabus.
OK, thank you Carl. I'm glad to see you know White House Africa policy. Maybe a bigger fish will come up with a new tune. What about Paul Wolfowitz? Cool, except he’s more a Middle East pundit than an Africa specialist. Sure, but he’s the Pentagon Number two. I guess he knows DoD's Africa Policy. What do you have to say Paul?
"I'm told there's an African proverb...it says, ‘One hand alone cannot tie a bundle.' Let the United States and the nations of Africa work together to find solutions to the problems we face," especially terrorism, the official said.
Hmmmm... Yes. I’m down with you, brother Paul. African proverbs come really handy when one has nothing substantial to say. Do you have a message I can bring back home in dusty Africa?
"Africa has already been drastically hurt by terrorism. We remember not only the bombings in Dar es Salaam and Nairobi in 1998, but more recently in Mombasa and in Casablanca. The global war on terrorism, in other words, is not only an American concern or a concern of the developed world; it is a growing African concern as well. We are working closely with many of our partners in Africa to combat terrorism. The Pan-Sahel Initiative and the East Africa Counter-terrorism Initiative are a key part of our efforts in that regard on the African continent.... Our goal as much as possible is to increase the capacity of our friends to provide for their own security. But we do believe that the militaries of African countries can and must attain a higher degree of professionalism, one that is better suited to the challenges of the 21st century."
I’m afraid I’ve already heard that track. Maybe it’s a special remix. Or maybe the lectures are not the main treat here: As the U.S. Dept. of Defense's most visible program in Africa, the Africa Center’s main goal is to offer networking opportunities to the US-Africa securocraty. That at least is clear. The Senior Leader Seminar will end this week. The next Africa Center event, the Central Africa Sub-Regional Seminar, will take place in May 2004.
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Tuesday, February 17, 2004
Seif al-Islam: the package-deal maker
Most analysts who try to make sense of the Libyan change of policy usually get it wrong because they focus their attention on the Libyan leader, Muammar Gaddafi. In so doing, they are trapped in a difficult choice: they either credit the Bush administration preventive war policy – which doesn’t hold – or they have to admit that Gaddafi’s move was a shrewd tactical shift with a perfect timing and so on. Problem : this is not coherent with the image the media built of the man; someone whose personality is described as “mercurial” – meaning “quick and changeable in temperament” - doesn’t easily stick to tactical moves. A bigger problem lies ahead: all commentators agree that this is not a new tactical shift, but a strategic one that Libya will stick to. As you can see, these explanations don’t fly much and those who took that path know it: they tend to blend their views with pseudo-psychological hypotheses that don’t go anywhere.
The logical solution to the Libyan puzzle is elsewhere: instead of focusing attention on “the Leader”, analysts are better off when they chose the other Gaddafi - Seif Al-Islam, the second son of Muammar. He’s been my main lead when I started to analyse Libyan policy shift. My January 22 post was based on Seif’s declarations: it allowed me to announce incredible things like the Blair’s visit to Gaddafi (days before it was confirmed by mainstream media networks) and US/UK military cooperation with Lybia. Three days later, the Scotland on Sunday’s diplomatic correspondent Ian Mather published an excellent article that established the big picture: As dramatic shifts are taking place in Libyan policies... it is Gaddafi’s second son, Seif al-Islam, who appears to be in charge. Mather then develops the idea through key episodes where Seif al-Islam played the number one role: the compensation campaigns (Lockerbie), the WMD coming-out, the first US congressmen’s visit, the appointment of American-trained Lybian economist Shukri Ghanem as prime minister in charge of privatisation and discussion with WTO, as well as direct talks with Israel. To this already impressive list, you can add the Jolo island hostage crisis in which “Libyan negotiators brokered the release of eight European and two South African hostages in late August and early September [2000].”
Libyan negotiators played a key role in the negotiations, and will apparently be footing the bill for ransoming the hostages. ... Seif al-Islam, the son of Libyan leader Moammar Qaddafi sent an emissary to Manila to try for a deal... Jeremy Binnie, a North Africa expert for the Jane's group of defense and analysis publications [said about Gaddafi that], “He’s trying to end Libya's isolation,” adding, “Whether he’s done a complete about-face is doubtful.”
That story took place a year before 9/11. Months later, when he sent a plane to Pakistan to repatriate 44 Arab fighters detained in Afghanistan and said it was for “humanitarian reasons”, it became obvious that the Gaddafi Foundation that he heads was being used as a diplomatic channel, whose true role was to “project a new and positive image of Libya”. It was pure soft-power politics:
We may have been surrounded by symbols of the Libyan state, fashioned according to Colonel Gaddafi's ideas, but Seif al-Islam insisted that his agenda is separate from that of the [Lybian governmental officials]. "I run a non-governmental organisation, I have my own agenda, I have my own mission, they have their own mission. Sometimes we agree and sometimes not," he said.
In a way, Seif al-Islam used the Gaddafi Foundation (a.k.a Gaddafi International Association for Charitable Organisations) as a policy spin-off that went from the startup phase (hostages episodes) to early development (compensation talks), then expansion (economic liberalisation program) and international joint-venture (WMD drama and military cooperation). Along this trajectory, the difference between Seif’s agenda and that of the Lybian regime blurred. It’s a perfect case of gradual take-over. The recent diplomatic successes of Prime Minister Ghanem (in Davos) and Foreign Minister Shalgam (in London) have been prepared by Seif al-Islam who now informally controls the governmental body.
Perhaps the person who deserves the most credit in bringing about these drastic changes in Libya is Seif al-Islam, Col. Gadhafi's son, and some say his political heir. The leader's second son heads the Gadhafi Foundation, a charity that tries hard to project a positive image of Libya.
Seif al-Islam’s influence at home and abroad have been growing since Y2K and will continue to do so as more analysts understand who really is in charge in Lybia. At home, the policy shifts decided by Seif and his father will meet the expectations of a new generation of citizens who will back him:
Libya has produced a new crop of citizens ... [trained] in the West and who has embraced private enterprise. These "New Libyans" have guided Col. Gaddafi to embrace globalisation, ... market economy, membership in the WTO. They do not want to see Libya remains a pariah state.... Gaddafi's son Seif quipped, "Now, finally we are catching up with the times." Seif Gaddafi is a pragmatic young man who is a doctoral student in global governance at the prestigious LSE in Britain. Even though Mr. Seif Gaddafi has no official role, nonetheless he represents the newer generation of Libyans who want to see the oil-rich nation embark onto modernisation a la western style.
Abroad, his latest diplomatic initiative (the WMD drama) is welcome for Bush and Blair alike. None of them could dream of a better timing:
In a recent interview given to Carla Anne Robbins of WSJ in Tripoli Seif Gaddafi said, "It's a package deal. They have to reward us in order to make us an example." What he meant by this is Libya can play a role model for the radical transformation of a rogue nation to become a law-abiding country in the comity of nations.... His timing was just absolutely right. In an election year, Mr. Bush may use Gaddafi's transformation from being a rogue ruler to a law-abiding citizen of the world far too many times. ... All indications are that the bilateral relationship between the U.S. and Libya is going to improve in the coming days.
In my next Lybian post, I will speak more specifically about the US plan to lift sanctions.
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Sao Tome: US funds feasibility study
Yesterday, we reported that ExxonMobil got 40 percent of an exploration block in Sao Tome. Today, we add that the United States will fund a study for Sao Tome airport and port facilities. That’s how fast things can go in oily West Africa:
The United States willfinance a feasibility study on the expansion of the international airport in Africa's smallest nation, in the hopes of furthering oil exploration there. The study, which is estimated to cost $800,000, will investigate airport expansion and modernization, as well the creation of a deepwater port in Sao Tome and Principe.... According to ExxonMobil spokesman Russ Roberts, West Africa is attractive not only for its oil potential, but also because it is less turbulent than the Middle East. "There is a lot out there now that says West Africa is the next frontier for oil. Much in the Middle East has been found, and then when you get into West Africa there are huge reservoirs that are being discovered," he said.
Sao Tome has been talked about for two years now as a possible base for US military operations in the Gulf of Guinea.
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The United States willfinance a feasibility study on the expansion of the international airport in Africa's smallest nation, in the hopes of furthering oil exploration there. The study, which is estimated to cost $800,000, will investigate airport expansion and modernization, as well the creation of a deepwater port in Sao Tome and Principe.... According to ExxonMobil spokesman Russ Roberts, West Africa is attractive not only for its oil potential, but also because it is less turbulent than the Middle East. "There is a lot out there now that says West Africa is the next frontier for oil. Much in the Middle East has been found, and then when you get into West Africa there are huge reservoirs that are being discovered," he said.
Sao Tome has been talked about for two years now as a possible base for US military operations in the Gulf of Guinea.
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US-Tunisia: discussing reform with an allied dictator
The United States expressed concern about the lack of political reform and media freedoms in Tunisia Tuesday as President Zine al-Abidine Ben Ali prepared to meet President Bush... Secretary of State Colin Powell met for an hour with Ben Ali, who came to power in 1987, won his last election with 99.44 percent of the vote and if re-elected could serve until 2014 under Tunisia's constitution. Powell praised Tunisia's economic reforms and stressed the friendly U.S.-Tunisian relationship but made clear he wanted to see greater reform in the North African country. "I also mentioned to the president (Ben Ali) that we had some continuing concerns with respect to political reform, with respect to media access and other similar issues where I think Tunisia could do more," Powell told reporters. "It will be a matter for discussion with the president tomorrow," he added.... Tunisia reflects the dilemma Washington faces in the Middle East as a whole -- whether to judge governments on their human rights and democratic credentials or to give priority to cooperation against religious militancy.
It's good to see that Powell is able to talk like that, not only to Russia, but also to a man who will host the Middle East Partnership Initiative - a US program designed to promote democracy and political reform in the Middle East and Africa. The appalling human rights record of Ben Ali didn't give Powell much choice. This will allow Bush to talk about more important matters, like the economic as well as security cooperation between both countries.
Darfur crisis threatens regional stability
In a previous post, I revealed the cross-border ethnic dynamics as well as the environmental dimensions of the conflict in Darfur. As the Sudanese peace talks are being resumed today in Kenya, IRIN published an excellent report of the role of Chad in the Darfur crisis. This is the best confirmation of the doubts that I expressed about the US-backed peace deal in Sudan:
playing mediator between Khartoum and the rebels, Chad has openly supplied troops to the Sudanese army in Darfur. But, covertly, it also serves as a conduit for arms that are fuelling the war, as an arena for Sudanese militias pursuing the refugees across the border, and as a refuge or assembly point for rebels and their families, say observers. Different ethnic groups in Chad may also be supplying [the rebels], as well as the militias aligned to the Sudanese [legal authorities]. These murky and often conflicting roles threaten not only to destabilise the current relative peace in Chad but may also lead to a regional war fought along ethnic lines, say observers. "It's a tribal war that has become a problem between the two countries," commented a former army officer and Zaghawah businessman in the Chadian capital, N'Djamena.... In both Darfur and Chad, numerous ... kin on the Chadian side of the border were helping their "brothers" in Sudan, with Chadian Arabs - travelling from as far away as Biltine and Ati - helping the militias, and the Zaghawah helping the rebels... Whether or not they are supplying manpower, at the very least the influential Zaghawah businesscommunity in Sudan, Chad and elsewhere is supporting the rebels financially, say observers.
The confusing situation is made even worse by the case of Chadian president Idriss Deby - himself a Zaghawah leader - who is caught in a catch 22 situation:
"Certain elements of the presidential guard of President Deby may be participating in the conflict, because the rebels are their cousins," said a senior army officer. "You have to understand that the Zaghawah officers are the biggest group in the army with arms and men under them" ... Deby is caught between his ethic affinity with his minority Zaghawah support base in Sudan and Chad - which put him into power - and his relationship with militarily powerful Khartoum.
The only important component of the balancing act which is not mentioned in this picture is the role of the United States: Americans are backing a peace process that is unlikely to stop the conflict because it doesn't involve the western nor the easter rebellions. Their main concern is the North-South divide: Under [US-backed] agreements signed so far, [southern] rebels will receive half the south's revenue and retain their forces during a six-year transition, after which southerners will vote whether to secede.
According to Islamist leader Hassan Al-Turabi, the U.S. pressure on Sudan to make peace with southern rebels won't be enough to make a deal stick:
"There are some forces in the United States who think that if the south can somehow mitigate the Islamism and Arabism of northern Sudan then it should remain united in the country," Turabi said.
"Otherwise it should secede and set itself up as a barrier against the expansion of these cultural effects into Africa," he said. Sudan's oil and the need to secure a foreign policy success also explained the U.S. interest in Sudan, Turabi said.
As Darfur rebels bolster their prediction of more conflict, the south-north peace process is in jeopardy: Insurgents in the east of Sudan and the west (Darfur) have forged an alliance that calls for a national conference and declare that they, too, are fighting for a share of Sudan's power and and oil wealth. This is no good for Bush who needs a win in Sudan. But, that's another story I'll tell you soon.
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Dangerous US anti-terror diplomacy in Kenya
In its dual global war for oil and against terror, the United States has chosen Africa both as a way to diversify its sources of cheap oil and a battlefield. While understandable from an American standpoint, this may prove deadly for some African societies that could feel the downsides of the situation without any of its upsides. The Kenyan authorities are being pressured by the United States into enacting anti-terror laws that would ultimately target local Muslim communities. But, as Ambrose Murunga reports from Nairobi, Kenya’s religious communities live in a peaceful co-existence based on a delicate balance that would be jeopardized by the terror campaign, importing in the country a conflict that comes from the Middle East.
So far, Kenya has been spared homegrown terrorists, unless, of course, we begin breeding them now. Kenyan Muslims have no track with religious fundamentalism. ... But acting under pressure from the US, Kenya is perilously close to creating an environment that may generate resentment where none previously existed. The Muslim community feels targeted by the US sponsored anti-terror campaign in Kenya.... Kenyans must not be penalised for holding views that are contrary to America's. Kenya needs to chart a course independent of US standpoint... resist any pressure that may lead to the creation of our own brand of kamikaze fanatics. Kenya is just another battleground for the US and its extremist enemies, and there is no point in us getting excited about it.
This is an invitation to learn from the war in Iraq: a preventive war on terror in Kenya can make the country more dangerous than it currently is.
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Monday, February 16, 2004
IFC to develop gas project in Mozambique
While the WorldBank Group's investments in the extractive industries is under review, its private sector arm IFC has announced a $18.5 million equity participation in a joint venture with South African synthetic fuels group Sasol (SOL) and ENH, Mozambique's national petroleum company, to develop natural gas resources in Mozambique's Inhambane Province... The project, which is lead by Sasol, will develop two natural gas fields, a central processing facility, and a 900-km pipeline that is to link the fields in Mozambique to Secunda, South Africa.
ENI starting new production in Libya
Italian oil firm ENI, which represents around 14 percent of Libya’s annual oil production, announced the start of production at the “Elephant” (Al Fiil) field. Situated 800 kilometres south of Tripoli, Elephant is a long-delayed oil field that is estimated by analysts to hold 500 million barrels of oil.
A top official at Libya's National Oil Corporation (NOC), which together with Eni operates the field through Agip Oil Company, had said in December that the field would be ready for first oil in 2004 or first oil in 2004 or 2005, with a flow rate of 50,000 bpd. .Eni, the Korean National Oil Corporation and NOC, LIBYA's state oil company run the exploration and exploitation of the field. Agip Oil Company is equally owned by NOC and Eni. ... Libya, now pumping 1.4 million barrels of oil per day from capacity of about 1.6 million bpd, has said it plans a fresh campaign to attract foreign investors despite Washington's reluctance to lift sanctions in place since 1982.
This press release came few days after Italian PM Berlusconi made the first Western head of state to visit Gaddafi since he said in December he was abandoning all programmes to develop weapons of mass destruction
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A top official at Libya's National Oil Corporation (NOC), which together with Eni operates the field through Agip Oil Company, had said in December that the field would be ready for first oil in 2004 or first oil in 2004 or 2005, with a flow rate of 50,000 bpd. .Eni, the Korean National Oil Corporation and NOC, LIBYA's state oil company run the exploration and exploitation of the field. Agip Oil Company is equally owned by NOC and Eni. ... Libya, now pumping 1.4 million barrels of oil per day from capacity of about 1.6 million bpd, has said it plans a fresh campaign to attract foreign investors despite Washington's reluctance to lift sanctions in place since 1982.
This press release came few days after Italian PM Berlusconi made the first Western head of state to visit Gaddafi since he said in December he was abandoning all programmes to develop weapons of mass destruction
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Exxon takes 40 percent stake in exploration block
Umar Tajudeen, chairman of the Nigeria-Sao Tome & Principe Joint Development Authority announced that U.S. oil supermajor ExxonMobil will take a 40 percent stake in a prime exploration block of Nigeria and Sao Tome and Principe's Joint Development Zone at a cost of some $49 million... Exxon still has an option to take up to 25 percent stakes in up to two more blocks. Tajudeen said that the final allocation of the remaining blocks, thought to hold millions of barrels of oil, will be announced by mid-March.
Halliburton probes linked to the Bush clan
Through the Committee on Public Petitions headed by Chudi Ofodile, the Nigerian National Assembly will start investigations into the Halliburton case on February 26. The investigation is expected to address alleged illegal commissions and payments made by TSKJ to bribe Nigerian officials. This probe is creating a bigger debate about multinational firms involvement in fraud and other unethical conduct in the oil industry: If we are serious about the fight against corruption we should beam our searchlights on these areas. Again, something is wrong with our system of award of contracts.
Meanwhile, in the United States, the situation has not come that far yet. In fact, "the US media recoil from using the "H" word and Cheney in the same sentence". In a thought-provoking article, Andrew Limburg summarises all the episodes that have escaped the headlines: “It is mind boggling to me how the majority of this can come to light over the last 3 months, and not be all over” the media every day. He makes a small mistake, though: the yellowcake story happened in Niger, not Nigeria.
In the mainstream media, only the International Herald Tribune has dared publish an article that confronts the real issue:
Because the Nigerian affair occurred under Cheney's watch at Halliburton, it has the potential to have a greater bearing on his political future than allegations of war profiteering by Halliburton or its subcontractors in Iraq after he left the chief executive's chair... Justice Department and Securities and Exchange Commission officials owe it to voters to determine as quickly as possible what role if any Cheney had in any Nigerian bribes.
As Halliburton's troubles continue to multiply, creating a long string of troubles, it's becoming obvious that Cheney is “likely to be a campaign issue” for Bush. The proof of the matter is given by Corporate Crime Reporter: "James Doty to investigate allegedly corrupt payments made in Nigeria" when Vice President Dick Cheney was CEO of Halliburton. James Doty represented Bush Jr. when he bought the Texas Rangers. Doty was general counsel to the Securities and Exchange Commission (SEC) under Bush Sr. The relations between James Doty and Bush clan are a confirmation that the Halliburton case represents a grave and imminent danger for the president, through Harken and Enron.
Sunday, February 15, 2004
Gambia: Oil finds announced
"I am pleased to announce that oil has been discovered in the Gambia," President Yahya Jammeh announced in a televised address to the nation late on Friday. "The results of our findings are very promising. We have discovered oil both onshore and offshore. The country will be a rich nation soon," he said.
Maybe somebody should tell him about the paradox of plenty.
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US lawmakers in Libya, again
Libyan leader Moammar Gaddafi held talks with six U.S. lawmakers Friday, part of an effort to end his country's status as an international pariah and reconcile with the United States.
All the members of this delegation but one serve on the House Intelligence Committee. After the meeting, Rep. Jane Harman, a California Democrat, praised Gaddafi's decision to abolish Libya's programs for weapons of mass destruction.
All the members of this delegation but one serve on the House Intelligence Committee. After the meeting, Rep. Jane Harman, a California Democrat, praised Gaddafi's decision to abolish Libya's programs for weapons of mass destruction.
Angola: 2 expats found dead
A British teacher working for Norwegian oil company Norsk Hydro has been found stabbed to death in his hotel room in Angola. This followed the death of another expat, Aswhini K Puri, head of the Lord Krishna Bank, who was found dead in a luxury hotel room. Any connection?
Bakassi: land swap deal delayed
As we predicted last week, the Bakassi border dispute between Cameroon and Nigeria is far from over. The meeting in Abuja has been quite heated and the UN-backed land swap deal will be delayed:
THE latest round of talks between Nigeria and Cameroun on the disputed Bakassi peninsula ended late Wednesday amid signs that disagreement over the potentially oil-rich area could delay implementation of a UN-backed land swap deal. Nigeria’s objections led to the postponement of a planned visit by UN, Nigerian and Camerounian officials to the peninsula, and talks on a final statement dragged on late into the night and became “quite heated” when the issue of the peninsula came up, according to a diplomatic source. Under a working plan drawn up last year and approved in Geneva last month by President Olusegun Obasanjo and his Camerounian counterpart, Paul Biya, Nigeria was to withdraw its forces from Bakassi by the end of May, in accordance with a judgement of the International Court of Justice (ICJ). But at Wednesday’s talks Nigerian delegates asked that the ambitious timetable be revised.
Friday, February 13, 2004
Fridayblog: digital transparency
The discussion on "digital democracy" attracted some attention after the O'reilly Conference. I'm still working on my essay about the issue.
Thursday, February 12, 2004
BP to rise oil production in Angola
Unlike Shell, BP is not considering an oil reserves reclassification. The company is expecting a growth from its new Angolan contract, increasing production five-fold in 2007:
BP plc's oil output in Angola is set to rise from 50,000 barrels per day currently to 250,000 in 2007 after winning a large concession from national oil company Sonangol, the company said in a statement. BP, formed in 1998 from a merger between British Petroleum and Amoco, is the world number three integrated oil concern, behind Royal Dutch Shell and Exxon Mobil. The concession consists of six offshore oilfields in the north-west of Angola. The oilfields, named "Grand Plutonium", are situated in bloc 18 at a depth of 1,200-1,500 metres.
BP plc's oil output in Angola is set to rise from 50,000 barrels per day currently to 250,000 in 2007 after winning a large concession from national oil company Sonangol, the company said in a statement. BP, formed in 1998 from a merger between British Petroleum and Amoco, is the world number three integrated oil concern, behind Royal Dutch Shell and Exxon Mobil. The concession consists of six offshore oilfields in the north-west of Angola. The oilfields, named "Grand Plutonium", are situated in bloc 18 at a depth of 1,200-1,500 metres.
South Africa's military assistance to Sudan
South African soldiers from private military company Executive Outcome are believed to fight alongside the "Sudanese special forces officers in counter-insurgency operations to guard the oil fields":
Many analysts believe that EO most recently aided Khartoum in its war efforts in southern Sudan. According to a report in Africa Confidential, the company also concluded a contract with Libya, involving the use of helicopters and infra-red technology - Libya reportedly recommended EO's services to the Khartoum regime.
Many analysts believe that EO most recently aided Khartoum in its war efforts in southern Sudan. According to a report in Africa Confidential, the company also concluded a contract with Libya, involving the use of helicopters and infra-red technology - Libya reportedly recommended EO's services to the Khartoum regime.
Cheney's geostrategic plans for oil
As Halliburton's troubles mount, even in Kuwait , it's about time we learn more about Dick Cheney. This article doesn't say a word about his role in Africa, but greatly helps understand how his involvement both in government and the oil industry helped him oversee the strategic directions that has been taken in US foreign policy before 9/11. Read carefully this:
In the spring of 2000, Cheney’s two worlds—commerce and politics— merged. Halliburton allowed its C.E.O. to serve simultaneously as the head of George W. Bush’s Vice-Presidential search committee. At the time, Bush said that his main criterion for a running mate was “somebody who’s not going to hurt you.” Cheney demanded reams of documents from the candidates he considered. In the end, he picked himself—a move that his longtime friend Stuart Spencer recently described, with admiration, as “the most Machiavellian fucking thing I’ve ever seen.” ... For months there has been a debate in Washington about when the Bush Administration decided to go to war against Saddam. In Ron Suskind’s recent book “The Price of Loyalty,” former Treasury Secretary Paul O’Neill charges that Cheney agitated for U.S. intervention well before the terrorist attacks of September 11, 2001. Additional evidence that Cheney played an early planning role is contained in a previously undisclosed National Security Council document, dated February 3, 2001. The top-secret document, written by a high-level N.S.C. official, concerned Cheney’s newly formed Energy Task Force. It directed the N.S.C. staff to cooperate fully with the Energy Task Force as it considered the “melding” of two seemingly unrelated areas of policy: “the review of operational policies towards rogue states,” such as Iraq, and “actions regarding the capture of new and existing oil and gas fields.” ... Mark Medish, who served as senior director for Russian, Ukrainian, and Eurasian affairs at the N.S.C. during the Clinton Administration, told me that he regards the document as potentially “huge.” He said, “People think Cheney’s Energy Task Force has been secretive about domestic issues,” referring to the fact that the Vice-President has been unwilling to reveal information about private task-force meetings that took place in 2001, when information was being gathered to help develop President Bush’s energy policy. “But if this little group was discussing geostrategic plans for oil, it puts the issue of war in the context of the captains of the oil industry sitting down with Cheney and laying grand, global plans.”
It's this Energy Task Force that was behind the New Energy Policy that established African oil as a priority for US national security. Don't forget that Halliburton's contracts span the globe.
Wednesday, February 11, 2004
US "see no evil" policy in Africa
Oil states are too often non-democratic regimes. Based on this statiscal evidence, it's difficult to discard the political economic approach to the paradox of plenty. However, such an approach doesn't cover the fact that non-democratic oil states are rarely isolated entities: the strategic nature of petroleum fuels patrons-clients relationships with these resources-rich developping countries and western oil-importing (democratic) regimes. How does the political support of a UN Security Council member like the United States or France impact the institutional evolution of non-democratic oil states? What is the responsibility of developped countries in the obvious lack of democracy in African oil states? According to Frida Berrigan, a senior research associate with the Arms Trade Resource Center, "at least part of the answer can be found in Washington’s policy of providing aid and training to leaders who guarantee an uninterrupted flow of oil, defending it against all threats—even those coming from their own citizens":
Africa accounts for 16 percent of U.S. oil imports, and the National Intelligence Council predicts an increase to 25 percent by 2015. Hunger for this oil, combined with the need to collect allies in the war on terrorism, led the Bush administration to adopt a “see no evil” position toward human rights problems and inequality in the continent’s oil-rich nations.
This "see no evil" diplomacy, where US quest for oil and its global war on terror are mixed, leads to partnerships that are not unlike the relation between America and Saudi Arabia. That's the case with Algeria, with "proven oil reserves of more than 9.2 billion barrels and is considered underdeveloped in terms of production, representing a golden opportunity for U.S. companies", and with Nigeria, the fifth largest exporter of oil to the United States.
Washington’s desire for Nigerian oil and territory triggered deeper military relationships. During the reign of Gen. Sani Abacha military ties were frozen. But since his death in 1999, the thaw has been quick. That year, Nigeria purchased $74,000 in U.S. weaponry. By 2001, the United States delivered thousands of times that—a total of $3.1 million. Military aid also skyrocketed, from $90,000 in 1999 to more than $4 million for 2003. How increased military aid will improve human rights and efforts toward democratization is unclear. The State Department’s Human Rights Report found that the Nigerian “military and security forces committed extrajudicial killings.”
Africa accounts for 16 percent of U.S. oil imports, and the National Intelligence Council predicts an increase to 25 percent by 2015. Hunger for this oil, combined with the need to collect allies in the war on terrorism, led the Bush administration to adopt a “see no evil” position toward human rights problems and inequality in the continent’s oil-rich nations.
This "see no evil" diplomacy, where US quest for oil and its global war on terror are mixed, leads to partnerships that are not unlike the relation between America and Saudi Arabia. That's the case with Algeria, with "proven oil reserves of more than 9.2 billion barrels and is considered underdeveloped in terms of production, representing a golden opportunity for U.S. companies", and with Nigeria, the fifth largest exporter of oil to the United States.
Washington’s desire for Nigerian oil and territory triggered deeper military relationships. During the reign of Gen. Sani Abacha military ties were frozen. But since his death in 1999, the thaw has been quick. That year, Nigeria purchased $74,000 in U.S. weaponry. By 2001, the United States delivered thousands of times that—a total of $3.1 million. Military aid also skyrocketed, from $90,000 in 1999 to more than $4 million for 2003. How increased military aid will improve human rights and efforts toward democratization is unclear. The State Department’s Human Rights Report found that the Nigerian “military and security forces committed extrajudicial killings.”
Sudan difficult balancing act
London-based Sudan government lobbyist David Hoile is at it again: upset by human rights NGOs' latest reports on Sudan, he wrote a vitriolic article that was circulated today on the Media Monitors Network - an organisation whose stated mission is "to expose the truth about black sheeps, propagandists, or crooks disguised as 'journalists' in the noble profession of journalism, who are paid or backed by intelligence agencies, political parties, politicians, bureaucrats, the Official Mafia, or the Disinformation Mafia", according to the Muhammad Ali Khan (Chief Editor & Founder)!
Hoile's article is just another attempt to replace what he calls human rights industry's propaganda (read "NGO reports") with the Sudanese goverment's own propaganda: blaming Eritrea and the Sudanese islamist opposition as main backers and weapons providers of the Darfur rebellion, Hoile's attack echoes the letter Mustafa Osman Ismail, Sudanese foreign minister, addressed to the UN Security Council last month. In that letter, which borders on conspiracy theory, Ismail explained Eritrean motivations as a desire to destabilize the Sudanese North-South peace process: "Eritrea was vexed by the Sudan's determination to achieve peace and secure a final and lasting settlement to the domestic conflict in the Sudan". Yes, of course.
If the situation is so dangerous in the West (Darfur, Chad), unfriendly in the East (Eritrea) and about to be settled in the South after the peace process is signed, it's difficult to understand why Sudan rejects international peacekeeping force? If we see a contradiction there, it's probably because we're manipulated by human logic's propaganda.
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Hoile's article is just another attempt to replace what he calls human rights industry's propaganda (read "NGO reports") with the Sudanese goverment's own propaganda: blaming Eritrea and the Sudanese islamist opposition as main backers and weapons providers of the Darfur rebellion, Hoile's attack echoes the letter Mustafa Osman Ismail, Sudanese foreign minister, addressed to the UN Security Council last month. In that letter, which borders on conspiracy theory, Ismail explained Eritrean motivations as a desire to destabilize the Sudanese North-South peace process: "Eritrea was vexed by the Sudan's determination to achieve peace and secure a final and lasting settlement to the domestic conflict in the Sudan". Yes, of course.
If the situation is so dangerous in the West (Darfur, Chad), unfriendly in the East (Eritrea) and about to be settled in the South after the peace process is signed, it's difficult to understand why Sudan rejects international peacekeeping force? If we see a contradiction there, it's probably because we're manipulated by human logic's propaganda.
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US open oil interest section in Libya
Not long ago, I wrote that the issue of US oil companies' return to Libya wasn't a question of if, but when. The United States made a new move reflecting the rapid normalization of its relations with Libya: an American interest section has opened in Tripoli, at the Belgian Embassy in Libya. It's the first US diplomatic presence there in almost a quarter century. Beyond the WMD issue that this diplomatic section is supposed to deal with, it is an important step that will ease two omportant issues: lifting US passport restrictions and travel ban to Libyans when the issue comes up for review on February 24, and easing one aspect of economic sanctions imposed in the mid-1980s so Americans can also spend money in the north African country. The US oil and gas industry is pressing for these changes so that it can go back to the Libyan business as soon as possible. According to the Washington Post,
Washington will also ease the sanctions to allow U.S. oil companies -- including Occidental, Marathon, Conoco and Amerada Hess -- to renegotiate contracts with Libya, according to U.S. officials. These companies, which previously had business interests in Libya, will be unable to fulfill the contracts until sanctions are fully lifted. But removing the travel ban and allowing contract negotiations pave the way for renewing U.S. involvement in Libya's oil industry.
These revelations are indications that US current policy towards Libya isn't based on small steps anymore, but big jumps. The pace of this process has been accelerated, confirming what I wrote few weeks ago. The Post outlines the next coming phases:
In talks last Friday in London, U.S. officials outlined three phases for the normalization of relations. U.S. officials hope to complete the first phase of these initial steps by the end of the month. Opening an interest section is a strong signal of U.S. good will, U.S. officials say. During the second and third phases, the administration will negotiate lifting presidential executive orders, the Iran-Libya Sanctions Act [ILSA] and Libya's position as one of seven countries on the U.S. terrorist list.
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Washington will also ease the sanctions to allow U.S. oil companies -- including Occidental, Marathon, Conoco and Amerada Hess -- to renegotiate contracts with Libya, according to U.S. officials. These companies, which previously had business interests in Libya, will be unable to fulfill the contracts until sanctions are fully lifted. But removing the travel ban and allowing contract negotiations pave the way for renewing U.S. involvement in Libya's oil industry.
These revelations are indications that US current policy towards Libya isn't based on small steps anymore, but big jumps. The pace of this process has been accelerated, confirming what I wrote few weeks ago. The Post outlines the next coming phases:
In talks last Friday in London, U.S. officials outlined three phases for the normalization of relations. U.S. officials hope to complete the first phase of these initial steps by the end of the month. Opening an interest section is a strong signal of U.S. good will, U.S. officials say. During the second and third phases, the administration will negotiate lifting presidential executive orders, the Iran-Libya Sanctions Act [ILSA] and Libya's position as one of seven countries on the U.S. terrorist list.
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Tuesday, February 10, 2004
Bush campaign financing & policy
Given the growing engagement of the United States in African oil politics and economy, it's worth tracking Bush family background, as well as the profile of the people and corporations funding his campaign.
Let's start with his family: it's an oil dynasty whose involvement in the industry goes back to John D. Rockeffeller, a hundred years ago.
The Bushes' ties to John D. Rockefeller and Standard Oil go back 100 years, when Rockefeller made Buckeye Steel Castings wildly successful by convincing railroads that carried their oil to buy heavy equipment from Buckeye. George H. Walker helped refurbish the Soviet oil industry in the 1920s, and Prescott Bush acquired experience in the international oil business as a 22- year director of Dresser Industries. George H.W. Bush, in turn, worked for Dresser and ran his own offshore oil-drilling business, Zapata Offshore. George W. Bush mostly raised money from investors for oil businesses that failed.
With such a background, you can easily guess the profile of the people who finance his campaign:
"It's hard to think of anyone [in the 20th century] who has been more connected to the corporate world than maybe Herbert Hoover"... The ties between the Bush administration and U.S. businesses are further cemented by campaign donations... Of the 391 "Pioneers" and "Rangers" who have raised $100,000 or $200,000 respectively for Bush's reelection bid, 70 are from the finance industry, 27 from the energy industry, 12 from insurance, 25 from the communications industry and 16 from the transportation industry. Seventy are corporate lawyers and lobbyists.
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Let's start with his family: it's an oil dynasty whose involvement in the industry goes back to John D. Rockeffeller, a hundred years ago.
The Bushes' ties to John D. Rockefeller and Standard Oil go back 100 years, when Rockefeller made Buckeye Steel Castings wildly successful by convincing railroads that carried their oil to buy heavy equipment from Buckeye. George H. Walker helped refurbish the Soviet oil industry in the 1920s, and Prescott Bush acquired experience in the international oil business as a 22- year director of Dresser Industries. George H.W. Bush, in turn, worked for Dresser and ran his own offshore oil-drilling business, Zapata Offshore. George W. Bush mostly raised money from investors for oil businesses that failed.
With such a background, you can easily guess the profile of the people who finance his campaign:
"It's hard to think of anyone [in the 20th century] who has been more connected to the corporate world than maybe Herbert Hoover"... The ties between the Bush administration and U.S. businesses are further cemented by campaign donations... Of the 391 "Pioneers" and "Rangers" who have raised $100,000 or $200,000 respectively for Bush's reelection bid, 70 are from the finance industry, 27 from the energy industry, 12 from insurance, 25 from the communications industry and 16 from the transportation industry. Seventy are corporate lawyers and lobbyists.
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Verbatim: US oil dependency
Following the release of the annual Economic Report of the President, The Post' journalist Jonathan Weisman chatted today with readers. Then came the OD question:
Does our dependency on oil from Arab-occupied countries still contribute to our current economic problems?
Jonathan Weisman: It does if oil prices suddenly spike. OPEC announced today it planned to cut back production in April, a potentially troubling development. Since so much of the economy runs on foreign oil, there is always a chance that an oil price shock will raise inflation, trigger interest rate hikes and really hurt the economy. That said, we are actually far less dependent on Middle East oil now that we get oil from Venezuela, Mexico, Nigeria and the former Soviet Union.
Those who witnessed oil-related social unrest in Venezuela and Nigeria must be glad to hear it.
Does our dependency on oil from Arab-occupied countries still contribute to our current economic problems?
Jonathan Weisman: It does if oil prices suddenly spike. OPEC announced today it planned to cut back production in April, a potentially troubling development. Since so much of the economy runs on foreign oil, there is always a chance that an oil price shock will raise inflation, trigger interest rate hikes and really hurt the economy. That said, we are actually far less dependent on Middle East oil now that we get oil from Venezuela, Mexico, Nigeria and the former Soviet Union.
Those who witnessed oil-related social unrest in Venezuela and Nigeria must be glad to hear it.
OPEC meeting haunted by oil depletion & disruption
The market overreacted to the Cartel's surprise decision to cut its total output by 2.5m barrels per day, or almost 10%. News we've been reporting lately (peak oil, civil unrest in Nigeria, Shell's oil reserves declassification, explosion of Skikda LNG terminal in Algeria) have been well described by the Economist:
"Oil companies must look increasingly to less and less stable regimes and trickier geology to bolster their reserves."
They must feel very sad, poor little things!
"Oil companies must look increasingly to less and less stable regimes and trickier geology to bolster their reserves."
They must feel very sad, poor little things!
Search for Abacha's loot in Kenyan banks
Investigators from Nigeria and Interpol are looking for billions of stolen oil money stashed overseas by former Nigerian dictator Sani Abacha. The investigation brought them to Kenya, a country that became - by lack of any legislation against economic crime and money laundering - a safe haven for international criminals, drug-traffrickers, dictators and their cronies.
The Nigerian government has so far been able to trace nearly... $3 billion — a third of the late dictator’s stolen fortune - believed to have been stashed in several secret accounts across the world. In 2002 a deal involving Switzerland, Britain, Luxembourg and Liechtenstein... Obasanjo’s government agreed to accept the money in return for amnesty to Abacha’s family. The family would also keep...$100 million for "upkeep" in a quid-pro-quo for helping the government discover "other assets" stolen by the dictator.
The Nigerian government has so far been able to trace nearly... $3 billion — a third of the late dictator’s stolen fortune - believed to have been stashed in several secret accounts across the world. In 2002 a deal involving Switzerland, Britain, Luxembourg and Liechtenstein... Obasanjo’s government agreed to accept the money in return for amnesty to Abacha’s family. The family would also keep...$100 million for "upkeep" in a quid-pro-quo for helping the government discover "other assets" stolen by the dictator.
ANC-Saddam: oil for friendship program
I wouldn't be regarded as fair if I don't pass on great stories like this one.
Saddam's Ba'ath Party... had sent diplomatic teams to many countries to offer oil lifting rights in return for friendship. "That is where the ANC [African National Congress] and the Ba'athists hooked up"... Saddam, his country under United Nations sanctions and constant threat from the United States, craved diplomatic support above all else. What his regime offered in exchange was lucrative allocations of Iraqi crude oil... the Iraqi regime had no qualms about using that power to buy or reward diplomatic friendship and punish enemies. Oil was as much a political as a commercial resource... "[If] you don't hate us; we give you oil."
I know I could (and maybe should) analyse the article as a bribery case involving ANC officials and South-African businessmen. But, it's so well written and sometimes funny that I will just let you do your own maths. There's one lesson in it that needs to be highlighted though: what Saddam did with his oil is pretty usual by African standards: Sani Abacha, Omar Bongo, Sassou Nguesso, Obiang Nguema, and numerous other current or former African oil statesmen have been selling their countries' oil cheap in order to buy political friendship from their western patrons.
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Saddam's Ba'ath Party... had sent diplomatic teams to many countries to offer oil lifting rights in return for friendship. "That is where the ANC [African National Congress] and the Ba'athists hooked up"... Saddam, his country under United Nations sanctions and constant threat from the United States, craved diplomatic support above all else. What his regime offered in exchange was lucrative allocations of Iraqi crude oil... the Iraqi regime had no qualms about using that power to buy or reward diplomatic friendship and punish enemies. Oil was as much a political as a commercial resource... "[If] you don't hate us; we give you oil."
I know I could (and maybe should) analyse the article as a bribery case involving ANC officials and South-African businessmen. But, it's so well written and sometimes funny that I will just let you do your own maths. There's one lesson in it that needs to be highlighted though: what Saddam did with his oil is pretty usual by African standards: Sani Abacha, Omar Bongo, Sassou Nguesso, Obiang Nguema, and numerous other current or former African oil statesmen have been selling their countries' oil cheap in order to buy political friendship from their western patrons.
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Nigeria-Cameroon: after Tunisia, Bakassi?
Soccer and border disputes are the two main issues that transformed Nigeria and Cameroon into arch rivals. If you’ve never visited Africa, you won’t be able to image the current atmosphere of joy and pride currently acknowledged by Nigeria after their national soccer team beat their Cameroonian counterparts in the ongoing African Nations Cup in Tunisia. Sure, “Nigeria took a 2-1 victory over the Indomitable Lions and will meet Tunisia in the semifinals tomorrow”, but the Bakassi border dispute, that is now on the UN Cameroon-Nigeria Mixed Commission, is not over yet. While Nigerians will be watching soccer, diplomats will be meeting in Abuja to discuss oil and land:
The Cameroon-Nigeria Mixed Commission will hold its eighth meeting in Abuja, Nigeria, from 10 to 12 February. It will take stock of the outcome of the Tripartite Summit between the President of the Republic of Cameroon, the President of the Federal Republic of Nigeria, and the Secretary-General of the United Nations held last week in Geneva... the two Presidents agreed to also consider concluding a Treaty of friendship and non-aggression between the two countries. The Cameroon-Nigeria Mixed Commission will hear the final report on the Withdrawal and Transfer of Authority in the Lake Chad area.
That’s a good thing. And good things on the continent should be highlighted; but as said UN SG Annan, Africa being "a continent with lots of problems, when you hear that things are going well, you get nervous”. And I would say, rightly so because whereas “an essential part of the work” has been done, the last mile might involve more bumps than expected.
The disputed border area is rich in oil. Tensions between Nigeria and Cameroon over their 1,600-kilometer border erupted into military conflict at the end of 1993. The following year, Cameroon brought the dispute before the International Court of Justice. In 2002, the Court confirmed sovereignty over portions of the territory to Cameroon and delineated the border. Nigeria also made certain land gains... The Bakassi Peninsula, a swampy bit of land which protrudes into the Gulf of Guinea, is potentially the most contentious issue. Nigerian soldiers are guarding the Peninsula which is believed to be rich in oil. Agreement on handing this prime bit of real estate over to Cameroon has yet to be achieved.
In light of the uncertainties ahead, soccer and oil politics will surely continue to play major roles in Nigeria-Cameroon relations. And I would personally give anything to be transformed into a mouse so that I can listen to the forthcoming discussions between the Lions (Cameroon) and the Eagles (Nigeria). The current nationalist fervour ignited by the African Nations Cup might not be put to rest.
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UK-Libya: Blair to meet Gaddafi
These days, it’s like all the diplomatic community's eyes are set on Libya. The latest headlines are about Blair: the British PM is planning a meeting with Libyan leader Gaddafi. That’s one of the official outcome of the meeting between Blair and Libyan foreign minister Chalgam.
Britain is arranging a meeting between British Prime Minister Tony Blair and Libyan Leader Moammar Gadhafi... "We've discussed that, we are hoping very much that a visit can be arranged as soon as convenient but no date has yet been fixed," Foreign Secretary Jack Straw said following a meeting between Blair and Mohamed Abderrhmane Chalgam.
The more sensitive talks, like military cooperation, have not been made public. But they will be... soon. No doubt about that.
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Britain is arranging a meeting between British Prime Minister Tony Blair and Libyan Leader Moammar Gadhafi... "We've discussed that, we are hoping very much that a visit can be arranged as soon as convenient but no date has yet been fixed," Foreign Secretary Jack Straw said following a meeting between Blair and Mohamed Abderrhmane Chalgam.
The more sensitive talks, like military cooperation, have not been made public. But they will be... soon. No doubt about that.
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Monday, February 09, 2004
Halliburton, Shell, Elf & co: leave no bribes behind
The basic rule of oilopoly is that any big African oil contract or venture has its dark side of shaddy deals, bribes, kickbacks, and what French corruption specialists call "retro-commissions". One case leading to another one, the Elf case that started a decade ago has bounced on Technip that fell all over Halliburton, and now Cheney. The fall of the house of cards is certainly not over. The Bonny natural gas plant has been one of the biggest gas project in Africa. So big that it has been developped in different phases, each involving two trains. The current probe concerns the first phase of the project with trains 1 and 2.
This first phase was for the engineering, procurement and construction of two identical trains, each with a design capacity of 2.95 million metric tons of LNG per year. Other services include onsite and offsite support facilities, a gas transmission system linking the plant by pipeline to the gas supply fields, and a residential area with 375 housing units for staff. A shopping center, hospital, guest house, restaurant, petrol station and recreational facilities were also completed.
But the contract for the second phase and the construction of trains 3 & 4, has been awarded to the same TSKJ consortium in March 2002 by the Nigerian LNG Limited company (NLNG). This is where things get juicy: who is behind NLNG?
NLNG is a Nigerian joint venture between the Nigerian National Petroleum Corporation, which has a 49 % state, Anglo-Dutch Shell Gas, with 25.6 %, TotalFinaElf, with 15 % and Italy's Agip International, with 10.4 %. The company's major buyers include Enel of Italy, Enagas of Spain, Botas of Turkey, Gaz de France and Transgas of Portugal. NLNG said the final decision to invest in the two plants was taken by the shareholders of the multi-billion-dollar gas firm and the contract was awarded to TSKJ... TSKJ is the joint venture team of Technip-Coflexip, Snamprogetti, Halliburton KBR and JGC.
The current Halliburton / Technip probes (in France, America, or Nigeria) may lead to new investigations concerning the second phase of the Bonny project and the circumstances that lead to the award of contract for construction of the Base trains, as well as trains 3, 4&5. Such a probe would be a logical next step, not only because of current probes, but also because "contract for the construction of trains 3, 4 & 5 was automatically awarded to TSKJ without recourse to an open tender exercise." Question for international Big Oil executives might now go like this: who's next? If the current Obasanjo government wants to stay true to its proclaimed fight against corruption, it should leave no bribes behind.
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Saturday, February 07, 2004
Cheney & Halliburton's probes
So far, none of the Halliburton's probes target Cheney. DoJ asked Halliburton to hand documents related to the allegations of bribes made by people working for Halliburton subsidiary in Nigeria. The Feds will look into allegations of kickbacks payment to determine if Halliburton’s management knew about the payments. The probe is made in light of the requirements of the U.S. Foreign Corrupt Practices Act (FCPA): That act [the FCPA] makes it illegal for U.S. persons to bribe a foreign government official to obtain or retain business, and it requires publicly traded companies like Halliburton to follow accounting and record-keeping provisions designed to make bribes hard to conceal.
Whereas Cheney is not the focus or the main target of any of these probes, they remain risky for Halliburton and for Cheney – and not only for political reasons (as Halliburton tries to frame the case). For the US DoJ probe to become a full investigation, it has to find evidence that:
a) Halliburton knew something about the alleged bribes payments;
b) or that Halliburton fails to disclose key information needed to determine if the company knew something.
The chances that a full investigation will be launched are not nil. This measure [the probe] provides for both civil and criminal penalties in connection with payment of bribes and can result in holding senior company executives liable for such actions.
For the French probe to become a full investigation targeting Cheney, the judge has to find evidence that
a) payments were made;
b) and that these payments were illegal.
In this case, Cheney could be charged in France with "misuse of corporate assets" (abus de biens sociaux). In this case, the only issue to consider is the degree of Cheney’s responsibility as CEO of one of the mother companies of the TSKJ joint venture. Things might get really nasty because a Technip official already describes Halliburton as “the leader” of the joint venture. Beside, the French judge (Renaud Van Ruymbeke) has a detailed list of payments, which will probably be used if a full investigation is launched.
Another problem for Cheney remains linked to Halliburton’s image of “usual suspect” for being “the target of a number of financial-impropriety allegations” : This is not the first time Halliburton has been tangled in bribery charges in Nigeria. In an SEC filing in May of last year, Halliburton said it had told the SEC that one of its subsidiaries operating in Nigeria had paid $2.4 million to a Nigerian tax official in an attempt to obtain favorable tax treatment.
This time, let's hope no bribes will be left behind.
Friday, February 06, 2004
Fridayblog: blogging for change
Ethan’s blog was the place to be this week. He posted an exciting essay on Monday (Feb. 2). As a preparation to the discussion he will co-host (with Joi Ito) at O'Reilley Digital Democracy Teach-In, Ethan outlines his impressions after reading two essays that are required reading for blogging activists: Joi Ito’s Emergent Democracy and James Moore’s The Second Superpower. Both texts were written in march 2003 and are full of the kind of geeky evangelising enthousiasm that I remember way too well.
Like both texts, Ethan’s essay deals with democracy and technology. But he does it from a perspective that is absent from the two other texts. To quote James Moore himself: “Ethan asks "Is there room for the third world in the second superpower?" Ethan discusses how web dialogue--which is now admittedly carried on mainly among a very small part of the world population, might grow to encompass the real 6.3 billion person world.”
I sent a first comment that was followed by replies and comments on the replies. So far, we have reached 13 comments. It was such a stimulating discussion that I have decided to collect the few suggestions I made into a formal essay that I’ll post this week-end here or on a new blog. I haven't decided yet.
I try to address the “media attention” problem from three different perspectives: technology, international relations, and marketing. The question that lurks in the back of my mind is this: how can a blog help address the oil curse?
As for BlogAfrica, it’s back on line after few days off. Ethan explains: “I and the other main contributors to the site have been badly overwhelmed and we've slipped up in keeping the site updated. I've tried to alleviate that today, but I've also got to talk with my colleagues about better ways to keep that project moving forward.”
I’ve added two new Africa-focused blogs on my buddy list: mental acrobatics and Kenya Pundit. Welcome to them!
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Nigerian bribery allegations: Halliburton probed in three countries
US mainstream media is slowly playing catch-up: Newsweek online edition broke the story when Michael Isikoff and Mark Hosenball got fresh information about the case. "The Justice Department has opened up an inquiry into whether Halliburton Co. was involved in the payment of $180 million in possible kickbacks to obtain contracts to build a natural gas plant in Nigeria during a period in the late 1990’s when Vice President Dick Cheney was chairman of the company", they wrote. Not only does their story cover more than the basic elements of the case, it also contains a buil-in meta-commentary on how the media in the United States failed to report the facts.
The Justice inquiry, along with a related probe by the Securities and Exchange Commission, parallels a separate investigation into the Nigerian payments that is being conducted by a French magistrate and has received widespread attention in recent months in the European press. But the Justice Department and SEC probes have not previously been reported, although they were briefly mentioned by Halliburton last week near the end of a lengthy filing with the SEC.
The day after, Sue Pleming's Reuters feed was widely circulated in national daily newspapers like the Washington Post. She's smart enough to first focus the reader's attention on Halliburton's PR campaign with a catchy yet neutral title: Halliburton Tackles Legal Problems with New Ads: Vice President Dick Cheney's old firm Halliburton, under scrutiny for possibly overcharging in Iraq and alleged kickbacks in Nigeria, fought back on Thursday with television ads defending itself... As news of the Justice Department's inquiries emerged, Halliburton launched 30-second television ads to address what it said were "misrepresentations ... that have been part of the national political debate during the presidential campaign."
It's only in the second part of the article that her bomb - subtitled the French probe - explodes:
The filing said the Justice Department and the SEC had asked Halliburton to report on these matters and were reviewing the allegations in light of the U.S. Foreign Corrupt Practices Act. The payments were allegedly made to Nigerian government officials. This Act provides for both civil and criminal penalties in connection with payment of bribes and can result in holding senior company executives liable for such actions. Cheney headed the company between 1995-2000.
It's up to the reader to connect the dots and do his own research. If he's smart enough, he will catch other elements of the puzzle on the AP wire: Nigeria orders probe into bribery allegations against Halliburton subsidiary. Now, if you put all the probes together, you end up with a case that spans three different countries (France, USA, Nigeria) on three different continents (Europe, America, Africa). And that's just one set of allegations. I didn't say anything about Iraq or the tax-evasion case in Nigeria.
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The Justice inquiry, along with a related probe by the Securities and Exchange Commission, parallels a separate investigation into the Nigerian payments that is being conducted by a French magistrate and has received widespread attention in recent months in the European press. But the Justice Department and SEC probes have not previously been reported, although they were briefly mentioned by Halliburton last week near the end of a lengthy filing with the SEC.
The day after, Sue Pleming's Reuters feed was widely circulated in national daily newspapers like the Washington Post. She's smart enough to first focus the reader's attention on Halliburton's PR campaign with a catchy yet neutral title: Halliburton Tackles Legal Problems with New Ads: Vice President Dick Cheney's old firm Halliburton, under scrutiny for possibly overcharging in Iraq and alleged kickbacks in Nigeria, fought back on Thursday with television ads defending itself... As news of the Justice Department's inquiries emerged, Halliburton launched 30-second television ads to address what it said were "misrepresentations ... that have been part of the national political debate during the presidential campaign."
It's only in the second part of the article that her bomb - subtitled the French probe - explodes:
The filing said the Justice Department and the SEC had asked Halliburton to report on these matters and were reviewing the allegations in light of the U.S. Foreign Corrupt Practices Act. The payments were allegedly made to Nigerian government officials. This Act provides for both civil and criminal penalties in connection with payment of bribes and can result in holding senior company executives liable for such actions. Cheney headed the company between 1995-2000.
It's up to the reader to connect the dots and do his own research. If he's smart enough, he will catch other elements of the puzzle on the AP wire: Nigeria orders probe into bribery allegations against Halliburton subsidiary. Now, if you put all the probes together, you end up with a case that spans three different countries (France, USA, Nigeria) on three different continents (Europe, America, Africa). And that's just one set of allegations. I didn't say anything about Iraq or the tax-evasion case in Nigeria.
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Shell chairman blames mystique of the oil industry
The financial market is losing patience with Shell CEO, Sir Philip Watts. His long-awaited speech on thursday didn't change the perception of the investment community: it's time for him to leave. Jeremy Warner's excellent article in the Independent best captures the mood of the market after Watts' speech:
As mea culpas go, they don't come more grovelling than the one issued yesterday by the Royal Dutch Shell chairman. Yet as it happens, he wasn't apologising about the company's calamitous reappraisal of reserves; only for his failure to appear in person to explain them to the City when they were first announced on 12 January. As for the downgrading itself, or the reasons why reserves came to be overbooked in the first place, two hours of presentations to analysts and the press yesterday failed to cast much light on the darkness. Was it cock-up or conspiracy that had led the company to overstate its proven reserves by as much as a fifth? We seem to be no nearer knowing the answer. Sir Phil would only say that judgements made in the past were not ones that would have been made today. Once he realised there was a problem, his instructions to the company were clear; "Get the facts and do the right thing". So what sparked the downgrade? The company attributes it to two "catalytic" events. One was the realisation that the oil wasn't coming out of the ground in Nigeria as fast as it was supposed to.
One thing is sure: "the company had exaggerated its proven reserves for at least 10 years". How was such a thing possible. One possible explanation might be incentive payments Shell and other firms received from "the Nigerian Government in return for booking oil and gas reserves in the country" . But Watts decided not to follow that over-sensitive lead. He opted for a less earthly explanation.
Did not Shell talk to its partners about reserving policies? Well, no; that's not apparently usual practice in such matters, a state of affairs the company attributes to "part of the mystique of the oil industry". Jolly handy, that mystique, for it enabled Shell to show it had added to its reserves in a year which would otherwise have shown a fall. More puzzling still, the find was categorised as a revision to reserves in the accounts, rather than a discovery, which meant that even eagle-eyed City analysts were not able to spot that Shell was booking things others weren't.
Watts' explanations are as slippery as Shell's corporate social responsibility policy in Nigeria and oil reserves reporting to the financial market.
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Thursday, February 05, 2004
IMF & World bank: preaching transparency behind closed doors
African officials and representatives from the World Bank and International Monetary Fund hold a two-day
meeting this week in Libreville (Gabon) to discuss oil revenue management and governance in oil exporting countries of sub-Saharan Africa.
Participants are... to find means that would ensure that oil revenues help boost development in producer and exporter countries rather than a "curse" in view of the poor results observed in the majority of countries endowed with this natural wealth. The discussions are being held in camera under the chairmanship of Donald Donovan (assistant director of the IMF Africa department), Alan Gelb (chief economist of the World Bank Africa region) and Robert Bacon (head of the hydrocarbons policy unit at the World Bank).
What? They organize a meeting in order to "improve transparency" in the african oil industry, but it's hold behind closed doors. An officier explained that holding the workshop "in camera" (behind closed doors) helps "work better"! Is this a new paradox of (resource) plenty or the regular dose of hypocrisy we're served with?
meeting this week in Libreville (Gabon) to discuss oil revenue management and governance in oil exporting countries of sub-Saharan Africa.
Participants are... to find means that would ensure that oil revenues help boost development in producer and exporter countries rather than a "curse" in view of the poor results observed in the majority of countries endowed with this natural wealth. The discussions are being held in camera under the chairmanship of Donald Donovan (assistant director of the IMF Africa department), Alan Gelb (chief economist of the World Bank Africa region) and Robert Bacon (head of the hydrocarbons policy unit at the World Bank).
What? They organize a meeting in order to "improve transparency" in the african oil industry, but it's hold behind closed doors. An officier explained that holding the workshop "in camera" (behind closed doors) helps "work better"! Is this a new paradox of (resource) plenty or the regular dose of hypocrisy we're served with?
Ituri: UN investigators attacked near oily border
While President Kabila is busy touring Europe this week, trying to attract EU investors to his war-torn country, the MONUC gets bloody: UN investigators are being killed.
Unidentified gunmen attacked on Wednesday a team of UN officials investigating the reported killing of 100 people almost three weeks ago in Gobu, a village in the troubled district of Ituri... Victims of the 16 January attack at Gobu, along Lake Albert, said 24 assailants, who had split up into several groups, joined boats transporting displaced people and traders to lakeside villages, and forced them to land at Gobu. Then, they separated the men from the women and children before shooting the men in groups.
In order for you to grasp the oily background of these acts of violence, I advise you to read this report, Shifting Sands: Oil Exploration in the Rift Valley and the Congo Conflict. The writer, Dominic Johnson from Pole Institute, gives a relevant account of the conflict in Ituri: as you see on the map, the Lake Albert area is a natural border between DRCongo and Uganda where Canadian firm Heritage Oil discovered oil. The discovery of oil on both sides of the border has been fuelling a cycle of ethnic conflicts that are not about to end soon, despite the presence of UN troops. Remember what an oil official said about Libya's border with Tunisia: "The geology doesn't change just because the political borders do."
A bit like the African Oil Politics blog, Dominic Johnson's “report is not so much about an oil hunch in the Semliki valley. It concentrates on laying out the complex and volatile context in which the entire venture is inscribed. (...) The intensification of war in Ituri in recent weeks, which at least one of the parties concerned has linked directly to oil interests, appears as a warning signal.” Since the report has been written last year, the logical conclusion is that nobody really paid attention. If people had, you would know better about the conflict by now – you wouldn't have the impression that it’s one more tribal war amongst many: it’s just one more african resource war amongst too much.
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Sudan-Chad: war, peace & oil
The title of Amnesty's latest report about the conflict in Darfur misrepresents the situation: I personally don't think that the victims of this war were "killed for no reason". I give some of the causes of the conflict in this discussion with Ethan: environmental hazards, ethnic polarization, local as well as regional power politics and oil revenue distribution in Sudan and Chad are key reasons. Darfur is a powder keg and will remain so as long as the players' reasons to fight are not adressed.
What we have here is a recipe for disaster. Oil on both side of the border is fueling two wars for the price of one: a civil war in Sudan (ethnic cleansing) and a hidden interstate war between Chad and Sudan; the root cause of both conflicts is environmental scarcity - desertification.
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Wednesday, February 04, 2004
Violence in Niger-Delta & CSR
ChevronTexaco will think twice next time before declaring the Niger-Delta region safe for business. The very same week the company's Community Affairs Manager in the Warri office, Yemi Emiko, said that "the security situation in the region had improved sufficiently to forecast a return to its ravaged installations in the next few months", a surge in criminal violent activities was recorded.
First, oil workers from Shell were kidnapped. Then, gun fights occured. Finally, young people threatened oil pipelines. As you probably know, the Niger-Delta region is where Nigeria's oil is produced, but it's also "one of the most neglected areas of the country". What we have here is a clear illustration of the situation analysed in Christian Aid's report, Behind the Mask - the real face of corporate social responsibility. In fact, "Royal Dutch Shell, which is the country's largest oil producer, has already returned to most of its sites closed by the violence and its production is rising steadily." Once again, Shell is involved in the latest turf war:
Some residents of Bukuma said the latest violence was over rival claims by the two groups for compensation allegedly offered by Shell for an oil spill last year. (...) In an unrelated incident, Shell said it asked the police and military to rescue three Nigerian employees of Baywood Continental, an oil services company contracted by Shell, who were kidnapped Sunday near the oil port of Warri.
When the report was released last week, the CEO of the Commonwealth Business Council, attacked it because it called for new laws to make businesses responsible for protecting human rights and the environment wherever they work - be it in Western Countries or in Nigeria. I wonder what he has to say about the latest news from the Niger-Delta. Maybe he thinks the region is safe for business, just like ChevronTexaco. Maybe he'll just repeat his favourite mantra:
CSR is nor an add-on, but an integral element of corporate strategy along with sales, production, financial control and the rest.
Yes, sir. Yes.
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First, oil workers from Shell were kidnapped. Then, gun fights occured. Finally, young people threatened oil pipelines. As you probably know, the Niger-Delta region is where Nigeria's oil is produced, but it's also "one of the most neglected areas of the country". What we have here is a clear illustration of the situation analysed in Christian Aid's report, Behind the Mask - the real face of corporate social responsibility. In fact, "Royal Dutch Shell, which is the country's largest oil producer, has already returned to most of its sites closed by the violence and its production is rising steadily." Once again, Shell is involved in the latest turf war:
Some residents of Bukuma said the latest violence was over rival claims by the two groups for compensation allegedly offered by Shell for an oil spill last year. (...) In an unrelated incident, Shell said it asked the police and military to rescue three Nigerian employees of Baywood Continental, an oil services company contracted by Shell, who were kidnapped Sunday near the oil port of Warri.
When the report was released last week, the CEO of the Commonwealth Business Council, attacked it because it called for new laws to make businesses responsible for protecting human rights and the environment wherever they work - be it in Western Countries or in Nigeria. I wonder what he has to say about the latest news from the Niger-Delta. Maybe he thinks the region is safe for business, just like ChevronTexaco. Maybe he'll just repeat his favourite mantra:
CSR is nor an add-on, but an integral element of corporate strategy along with sales, production, financial control and the rest.
Yes, sir. Yes.
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China gets a piece of the African oil action
When a chinese dictator meets a West African dictator from Gabon, what do they talk about? OIL.
The West African nation of Gabon isn't one of the world's more high-profile countries. So why a full-out state visit by China's leader? That's easy: oil. Burning fuel at a record pace to run an economy in overdrive, China since late 2003 claimed the No. 2 spot in world oil imports, second only to the United States. And jostling with the world's other oil gulpers to keep their machinery moving, China's leaders are looking far afield for a secure oil supply, locking down tough-term deals with easy-term cash.
The Chinese basically want the same thing the West does. The only difference is that they won't have to listen to human rights activists complaining about their relations with African oil-statesmen. It's a minor difference though. Jusk ask Chirac what France's ElfTotal has been doing for years in Gabon or or Bush-Cheney what ChevronTexaco is doing in the Gulf of Guinea. No kiddin'. China's new policy towards Africa doesn't look very new to people who know French and American policies on the continent. In fact, if you read better, you will see that the aggreement with Chinese firm Sinopec is to be implemented by French company Total, which means what we have a Sino-French deal, probably discussed last week in Paris, when Hu was visiting his new friend Chirac. Bongo and Chirac think and talk the same when it comes to Taiwan being part of China.
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The West African nation of Gabon isn't one of the world's more high-profile countries. So why a full-out state visit by China's leader? That's easy: oil. Burning fuel at a record pace to run an economy in overdrive, China since late 2003 claimed the No. 2 spot in world oil imports, second only to the United States. And jostling with the world's other oil gulpers to keep their machinery moving, China's leaders are looking far afield for a secure oil supply, locking down tough-term deals with easy-term cash.
The Chinese basically want the same thing the West does. The only difference is that they won't have to listen to human rights activists complaining about their relations with African oil-statesmen. It's a minor difference though. Jusk ask Chirac what France's ElfTotal has been doing for years in Gabon or or Bush-Cheney what ChevronTexaco is doing in the Gulf of Guinea. No kiddin'. China's new policy towards Africa doesn't look very new to people who know French and American policies on the continent. In fact, if you read better, you will see that the aggreement with Chinese firm Sinopec is to be implemented by French company Total, which means what we have a Sino-French deal, probably discussed last week in Paris, when Hu was visiting his new friend Chirac. Bongo and Chirac think and talk the same when it comes to Taiwan being part of China.
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US-Libya political borders shift fast
After Libya was gratified with a new series of kind comments from Colin Powell - who saw "a fascinating sign of change in Libyan attitudes" - and from other US officials, Libya will be treated this week-end with political talks to be held in London. The diplomatic agenda involves various sanctions to be lifted:
Some of the sanctions, including the terrorism-related ones, are congressionally mandated and their removal would be a lengthy process. But others can be lifted at the discretion of the Bush administration. (...) one that might be lifted soon is the long-standing ban on the use of U.S. passports for travel to Libya, which comes up for a State Department review later this month.
While Middle East analysts try to read these evolutions as a fundamental change in the geopolitics of WMD in the region, other officials - like U.S. Rep. Solomon Ortiz - remain sceptic about the reality of Libya's nuclear ability: he said "while touring a nuclear reactor in Libya that an official led him to suspect that the country's nuclear capabilities had been overstated. He said he asked the official how long it would take to dismantle Libya's nuclear program and the man did not answer. "We assumed that meant they don't have anything," Ortiz said."
All this is no news for oil men who are ready to deal with Libyan authorities. As one of them declared, "The geology doesn't change just because the political borders do." I couldn't have said it better.
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Tuesday, February 03, 2004
Oil as growth factor for African business in 2004
According to Voice of America, year 2004 will be a good year for African business. Along with peace and "good governance", oil is mentionned as a key factor of growth. Problem is oil can cause war and drive corruption. Eh, what did you expect - this is Voice of America: the tone is upbeat and rosy. But let's be honest: people like Alex Vines who are interviewed give a more balanced view of what might go wrong. If you mix both views, you can a rather predictable picture: oilmen and African rulers will be happy and African populations will worry. The more things change, the more...
African petroleum exporters are expected to benefit from continuing high prices for the commodity. Thanks to oil, economists say Africa will figure prominently – and perhaps disproportionately - among the world’s fastest growing economies. Patrick Smith is the editor of the London-based newsletter, Africa Confidential. He describes the growth of Africa's oil producers as "phenomenal": "Each year," he says, "another African oil producer becomes the world’s fastest growing economy. This year it is Chad at 58 percent – it’s the result of it shipping it out through a pipeline to Cameroon. The other new oil producer is Equatorial Guinea. The production rate there is going up fast - it will be almost half a million barrels a day from less than a 100 thousand three years ago. Sudan hopes to get up to a million barrels a day in a year or so; that’s a source of revenue that did not exist in that country five years ago. It also puts Africa on the map as a resource center for the US and Europe." The continent is expected to increase its petroleum exports by 14 percent in 2004 – with Nigeria and Angola in the lead. But increases in oil production – and the economic boom it brings – does not necessarily mean standards of living will improve this year.
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Nigerian tax-evasion scheme behind Shell scandal
Three weeks after the beginning of the oil reserves scandal, Shell’s explanations remain confused and confusing. Only recently are stories surfacing that Shell was receiving financial incentives from the Nigerian Government as the result of an oil reserves booking scheme that ran between 1990 and 1999.
Shell failed to inform shareholders and US regulators directly that it was receiving incentive payments from the Nigerian Government in return for booking oil and gas reserves in the country. (...) Under Nigeria's reserves addition bonus scheme Shell and other overseas oil majors received incentives in the form of tax credits for each barrel of oil booked. Nigeria also benefited from the arrangement by being able to demand a bigger output quota from Opec and higher prices from international oil companies when it auctioned off exploration acreage. The bonus scheme ran for nine years from 1991. It was scrapped in 2000 by the new Nigerian Government of President Olusegun Obasanjo, which is now seeking to recover $600m (£329m) from Shell and other international oil companies.
The Nigerian daily Vanguard describes the current situation between the government and oil multinational companies as a dispute, stressing the fact that their relation is not as quiet or neutral as the british press tries to describe it:
Dispute over reserve additional bonus followed a 1991 agreement between the Federal Government and the multinational oil companies aimed at encouraging the oil companies to engage in exploration activities when there is a prevailing low interest regime in the finance sector. A copy of the agreement indicated that the multinational oil companies are expected to receive tax-break when their annual increase in reserves volume exceeds the amount of oil produced during the period. However, the agreement also stated that the Federal Government could reappraise the tax-break if the reserves estimate was revised downward. At the time of filling this report, efforts to get officials of ChevronTexaco, ExxonMobil and TotalFinaElf and Nigeria Agip Oil Company to react to these developments proved abortive. Meanwhile, sources at the Ministry of Petroleum Resources said some of the 1.3 billion barrels of crude oil affected by Shell’s reserves reclassification were oil rims associated with gas developments in the country.
Oil multinational have taken advantage of the system for years, overbooking their reserves like crazy to get more tax-incentive. Now that the government has changed rules, they prefer making more "realistic" statements. If the financial market had known about these arrangements sooner in the 1990's, it would probably have a better understanding of the shady deals being reconsidered today. The scheme represented a "gold rush" for big oil that enjoyed the lack of "vigilance attached to the Nigeria operation". It's because Nigeria had, in a way, become an eldorado of capitalism and laissez-faire in the 1990's that Shell got carried away in reseres booking scheme that has lead it to the PR blunder the financial community has witnessed in January 2004. But the financial market is not Nigeria. You can't do as you wish just because you're Shell. Africa is the soft belly of western capitalism. And sometimes, chickens just come home...
[U]nder the Nigerian system, a wider range of reserves was reported to the government than was required by the US Securities and Exchange Commission. An oil industry source said: "During the 1990s there was real competition for reserves booking and perhaps there was less vigilance attached to the Nigerian operation than there should have been. Everyone got carried away in the gold rush. Some of these reserves were not only not provable but not realisable.” Shell has declined to say what proportion of the over-booked reserves relate to Nigeria. But it is certain to come under pressure to give a clear account of what went on when it presents its results.
So far, only Shell has decided to update its oil reserves. Who's next?
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Halliburton's bribery & tax-evasion cases in Nigeria
Mainstream media networks in the United States continue to ignore or downplay the Halliburton’s Nigerian cases of bribery and tax-evasion. The latest example of "minimization" is given in this article which basically tries to downplay the role and responsibility of Cheney.
It first portrays corruption in Nigeria as a natural "hazard" : Nigeria... is a country where the hazards have long included heat, disease and government officials greedy for payoffs.
It then tries (hardly) to present a balanced view of the cases: The affair is potentially embarrassing to the White House and could prove more worrisome to many of the managers who were in charge of the construction project during the last decade. Halliburton is already facing a separate investigation in Nigeria and the United States after disclosing that some employees in Nigeria paid $2.4 million in bribes to a Nigerian who claimed to be a tax consultant and turned out to be a tax official. Halliburton says that no senior company executives were involved.
But since it's soooo difficult to stay balanced, the journalist helps us understand how limited a role Cheney and Halliburton played: The payments tied to the LNG plant in Nigeria occurred between 1995 and 2002... were made in the same years that construction contracts were awarded for the multiphase project...Only one of the four payments in question was made while Cheney, who was chief executive of Halliburton from 1995 to 2000, had any control of the unit engaged in the Nigerian project.
As for Halliburton’s share in the joint venture involved in the bribes, its share is considered “slighty larger” than the share of its three partners. Finally, when it comes to French law, the journalist regrets that “Under the French system ... the government has no power to block Van Ruymbeke's investigation or prevent him from bringing charges, even if “politically it seems very difficult,”.” In so doing, he fails to explain that the anti-corruption law is an international OECD convention. Too bad!
But there are other interesting developments in Nigeria: a key daily newspaper, Vanguard, has started to pressure government on the tax-evasion and bribery committed by Halliburton – once again:
Last year, the company confessed to offering a bribe of $2.4 million to some Nigerians in order to obtain favourable tax rebates. Obviously, the tax evaded as a result would have exceeded the amount paid out as bribe at the time. At today’s exchange rates the bribe alone would be worth about 270 million; the tax evaded several times that amount. Given the government’s often stated position on corruption Vanguard and, indeed, the people would have expected the government to investigate the matter and to publicly identify those involved and to prosecute them. This apparently has not been the case. The matter, like most others involving highly placed individuals in the corridors of power, has been conveniently swept under the carpet. (...) Till today government has not informed the general public how the cases of tax-evasion and bribery committed by Halliburton have been disposed off.
Natural gas development delay & the Shell case
The Financial Times opens up a new vista on the Shell reclassification case: natural gas development delay would be the main cause of the problem. Sir Philip Watts may use that line of defense on thurday:
Royal Dutch/Shell, Europe's second largest listed energy group, was forced to slash up to 1.3bn barrels of its proved reserves in Nigeria because of delays in investments in the natural gas it found.
"Some of those 1.3bn barrels were oil rims associated with gas developments," said a senior Nigerian government oil official. "It is those gas projects that are not yet ready for FID [a final investment decision]. The moment FID is reached on those gas gathering programmes, some of those will come back."
He now expects at least half of the fields to be developed in the next five years. Shell has said it is confident that eventually all the fields will be developed.
Sir Philip Watts, Shell chairman, is due on Thursday to give a full explanation of why the world's third largest listed oil company was forced to cut its proved oil and natural gas reserves by 20 per cent, the largest adjustment having been made in Nigeria and Australia. Investors slashed 8-10 per cent off Shell's share price after the admission and called for Sir Philip's resignation.
Financial Times interviews with oil and government leaders in Nigeria reveal that hesitance to invest in expensive infrastructure to deal with the natural gas that Shell found together with the oil it was seeking, slowed development of certain fields.
Chris Finlayson, chairman and managing director of Shell Petroleum Development Company of Nigeria, would not comment on the reasons for the reclassification, but did acknowledge there had been delays in natural gas investments critical to exploiting Nigeria's oil fields. "The primary constraint is the level of spending the government is willing to put in. To put in an integrated gas and oil development is more expensive than a simple oil development. In essentially a capital-constrained environment, with a limit on the funding going into the industry, clearly [that] does constrain how much you can do," he said.
Nigeria has outlawed non-essential flaring after 2008, halting the environmentally damaging way to get rid of gas found in oil fields. Much of the gas will instead be sent to be liquefied and exported. Shell has so far cut its flaring 60 per cent, in large part by supplying the gas to Nigeria's new Liquefied Natural Gas plant and exporting it to Spain, Italy and France.
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Sunday, February 01, 2004
Oil depletion and the scramble for African oil
The aftershock of the Shell (oil-reserves) overbooking case can be tracked in the media. Beyond the issue of the company’s immediate future, the debate focuses on the difficulty to know exactly how much oil reserves there is worldwide. Whereas some analysts discuss the standards for reporting oil reserves, others re-open the Hubbert's peak (or “peak-oil”) debate: “no one really knows how much oil is left in the ground”, writes David Francis in the Christian Science Monitor. In his article (Has global oil production peaked?), he draws links between the current peak-oil issue and the scramble for new sources of oil in places like Africa.
The question now making the rounds in energy circles: Has production already peaked? If it has - or if a peak lies only a few years away - the repercussions would be huge. It could intensify a scramble by oil importers to tie up existing reserves. Decline could lead to scarcity and higher prices, possibly recession, while prompting an urgent push to alternative fuels and conservation. (...) In any case, major oil importers aren't waiting around to find out who's right. The US, Japan, Europe, and China, are scrambling to tie down petroleum resources in the Caspian Sea region, Russia, West Africa, Iraq, Iran, and Libya. (...) The US has just extended trade preferences to Angola, where oil giants ChevronTexaco and ExxonMobil are preparing to spend billions of dollars on deep-water developments. Other US oil firms, such as ConocoPhillips, Occidental Petroleum, Marathon Oil, and Amerada Hess are looking carefully at their prospects for returning to Libya should the US government lift sanctions on that desert nation.
How interesting!
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