By JAMES GIBNEY

Bloomberg News
Sunday, January 3, 2016
(Published in print: Sunday, January 3, 2016)


In one of Africa’s most celebrated surprises of 2015, Nigerian voters unseated President Goodluck Jonathan. The election of Muhammadu Buhari defied expectations of electoral fraud and violence, and his anticorruption platform sparked hopes for reform and economic growth.

Yet progress on both fronts has been slow and uneven. To understand why, pick up Tom Burgis’s The Looting Machine, a bracing look at why a continent blessed with one-third of the world’s hydrocarbon and mineral wealth remains mired in poverty and dysfunction.

A former Africa correspondent for the Financial Times, Burgis goes beyond the tales of spectacular venality among Africa’s “Big Men” – the world’s four longest-serving rulers are in African countries bursting with oil or minerals – to explain how the continent’s “resource curse” is sapping its development.

Nigeria is a case in point. Africa’s biggest oil producer gets more than 90 percent of its foreign earnings and two-thirds of its tax revenue from oil exports. Yet there are many reasons why that hydrocarbon bounty is a mixed blessing.

For starters, it can drive up the value of a nation’s currency, making other exports less competitive and imports more attractive. As Burgis points out, textiles used to be Nigeria’s most important manufacturing industry. But cheaper Chinese imports smuggled in by Nigerian gangs (an illicit trade worth more than $2 billion a year) have devastated the industry – one example of why Africa produces just 1.5 percent of global manufacturing output, despite its abundance of cheap labor.

Billions of dollars in oil revenues are also a tempting pot of money for bent politicians. One 2012 report said corruption had swallowed up $37 billion worth of Nigeria’s oil money over the last decade. That surpasses the annual economic output of more than half of the nations in Africa as well as Nigeria’s annual federal budget.

Such corruption has other toxic effects. Dirty money from bribes and kickbacks has to be laundered, and because those doing the cleaning don’t care so much about profit or productive investment, their infusions of cash distort the value of assets.

Nigeria’s reliance on oil for tax revenues also creates a perverse political dynamic: As Burgis puts it, “the ability of rulers of Africa’s resource state to govern without recourse to popular consent.” Instead of having to do right by taxpayers to win their votes, politicians focus on controlling and dispensing mineral wealth to bolster their patronage networks.

“Politics becomes a game of mobilizing one’s ethnic brethren,” Burgis notes – a contest with dangerous destabilizing effects in Nigeria’s fractious polity. In fact, as one Nigerian governor explains, if he failed to share the wealth, ill-gotten or otherwise, “I’ve got a big political enemy.”

Nigeria is far from the exception. At least 20 African countries are what the International Monetary Fund calls “resource-rich”: that is, their natural resources account for more than one-quarter of exports. Risking limb if not life, Burgis gamely takes readers around some of them, from the coltan mines of the Democratic Republic of the Congo and Guinea’s rich bauxite and iron ore deposits to the diamond fields of Zimbabwe.

Even as the names and histories of the different predatory leaders blur, one thing is clear: Their looting depends on an all-too-willing cast of outside partners, whether Western mining and oil companies that plunked down bribes and abetted massacres, shady Israeli middlemen or shell companies in the British Virgin Islands.

Particularly disquieting is Burgis’s description of the unsavory role played by the World Bank’s International Finance Corporation, which backed visibly corrupt, environmentally destructive, or just plain inequitable oil and mining ventures in Chad, Guinea and Ghana – all countries it was supposed to be helping.

If Burgis’s book were to be made into a movie, though, the star villain would have to be Samuel Pa, the bespectacled, bearded Zelig behind some of the continent’s most dubious recent resource deals. Over the course of several decades, Pa parlayed the connections he made as a Chinese intelligence operative and arms merchant into a sprawling, secretive consortium based in Hong Kong known as the 88 Queensway Group, not to mention a spot on the U.S. Treasury’s sanctions list.

Western criticism of China’s growing presence in Africa, Burgis writes, nonetheless carries a “distinct whiff of hypocrisy” that might make even King Leopold blush. Moreover, ordinary Africans stand to gain much from the $1 trillion or so that Chinese entities will reportedly plow into their continent by 2025.

That said, the tale of Pa and Queensway, which has its tentacles wrapped around oil holdings in Angola and Nigeria, diamond mines in Zimbabwe, and agriculture in Mozambique (to name just a few of its ventures), reeks of sulfur and brimstone. As several seasoned African mining executives told Burgis, the Queensway Group reminded them of Cecil John Rhodes, the forerunner of those who “use the conquest of natural resources to advance political power and vice versa.”

One of the best hopes for curbing this rapacity and corruption may be to impose greater transparency on Africa’s outside business partners. The U.S. Securities and Exchange Commission, for instance, recently proposed a rule requiring U.S.-listed oil, gas and mining companies to publish details of their payments to governments.

Even China may see the writing on the wall. A few months after Burgis’s book came out this year, he reported that Pa had been detained in one of China’s deepening anti-corruption probes. Guess that scotches the prospect of any Pa Scholarships in the future.

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Garnet Jules
The looting machine is largely European. The Africans have already smelled the coffee where these entities are concerned, hence the African Union. It may NOT be possible at this time to dethrone these Western backed looters, so for now the Africans must work around them. These are vestiges of the colonial era. The Europeans used civil and proxy wars, assassinations of Heads of States and some might even dare say diseases such as AIDS and Ebola to keep Africa in disarray and dependent on the West. Africa will rise as they shake off these Colonial shackles. They need to develop their infrastructure, agriculture and a strong military to be able to kick these looters out. In the mean time the priority must be to lift the hundreds of millions of Africans out of poverty.
Like · Reply · 1 · 5 hrs


Taju Yusuf · General Manager at T & A NIG LTD. OFFSHORE SUPPORT COMPANY
It's not only the Europeans even the Indians, Chinese. philipenos etc, they exploit our people too much because of poverty and ignorance, with 100 dollars they treat our women and men as slaves.
Like · Reply · 1 · 5 hrs


Bosco Habyari · United Nations Mandated University for Peace
Another attempt to understand and/or address serious issues through its consequences/effects instead of looking at the root causes. Not an accident though. Next step, I challenge you to touch the system that creates and maintains those looters; you'll be surprised to realize that the looting machine acts in Africa to sustain its creator and maintainer in 'the West'. That said, I agree with you, this looting machine is among reasons why Africa isn't rising. But obviously as much as it happens there or here depending on where one is, it is meanigful here or there (see how connected the world has become, unfortunately/fortunately).
Like · Reply · 1 · 4 hrs


Collins Okeke
It is the natural instinct to look for the enemy outside. For many decades, Africa's problems have been blamed on colonisation and the machine established by the west. While there is some truth in it, i believe in the principle of self-determination. If African leaders truly cared about African people and the continent; if African leaders genuinely cared about the way Africans and African continent are looked upon in the world, they would be able to find the will and the intelligence they need to dismantle the vestiges of western control on the continent. Western partners in looting Africa are...See More
Like · Reply · 3 · 4 hrs


Okoro Onyeije C · ST Aquinas Secondary School Elele
Collins, you're very correct! Africa's delimma is purely African's making. Though there is place, purpose, and reason for 'colonialism,' Africa was not the only continent to be colonised. Africa's delimma is acestral! And the world's peoples know this except Africans themselves. They know we are the lowest of slaves, as the book of Genesis says, while we don't: and that is why we produced slaves and sold to them in the past. Which other people produced slaves and sold to other peoples? And they know we lack leadership and cannot run civilized governments. Neither can we manage our affairs. For the how abouts of the state of Africa see the book: NIGERIA: Her Woes and Their True Remedies.
Like · Reply · 3 hrs


Friday Rewane · Helsinki
Okoro Onyeije C I totally agreed with you.The blackman is conscience less! A race that could sell their brothers and sisters as slaves.
Like · Reply · 2 hrs
Wilson Chuks · Supervisor at Port harcourt flour mills ltd
Okoro Onyeije C If the Europeans want to help they will, not to come and say how Africans are looting, how many of the European countries are benefiting from those loots
Like · Reply · 26 mins
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Seenaa Bilisummaa
@Garnet Jules
I know you are pointed the legitmate stake holders in this issue.
But in my view I don't want to make other factors as number one cause. I am Ethiopian and look what is happening in Ethiopia right now. The government was claiming a double digit growth for the last 12 years but unable to feed its people and pledging 1.4 billion dollar for food. If you look deep to the Ethiopian economy and government almost all companies are owned by TPLF (Tigray people Liberation front) more than 90% of generals in the military are from TPLF. Look what happened now more than 100 protestors were killed and Oromia region in Ethiopia is under heavy military control. What I mean here is looting of a country even goes to the extent of killing when protesters are raising questions. The only option for Ethiopia in particular or world in general only democracy and good governanace uproot this looting and backwardness.
Like · Reply · 3 hrs


Chika Onyeani · Fordham University
I don't understand why this article is appearing again, except to purvey Mr. Burgis's book. When the article appeared six days ago, I wrote to Mr. Gibney as follows: "It is always very easy to write about the looting going on in Africa by African leaders - it absolves western journalists of irresponsibility. As you were writing about the billions in dollars being siphoned from the African continent, specifically from Nigeria, I didn't see you blame the western nations that continue to launder the funds stolen from Africa and using those funds for their economic development.


Mr. Purgis blis...See More
Like · Reply · 1 · 3 hrs
Wilson Chuks · Supervisor at Port harcourt flour mills ltd
Why coming up with this your report, the Europeans were part of the looters and even the machine itself, the alliance between Africa and China is why you came up with the result of investigation, this monies were looted into Europe and they lived fat with it, they ( Africa ) need help from China, and so be it, because the Europeans are not to be trusted.

This is very good conversation. It'll be nice to get into this and discuss. All said and done, Africa's sorry state is Africa's making. If there existed determination and will to correct things, I don't think any western machine can stop this.

He shirt self people no read


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