Friday, July 23, 2010

The Oil Curse

For years the benefit of gold, diamond, cocoa and other mineral export has not brought any seemingly benefit to the majority of African people. Rather the majority still wallow in chronic poverty, with no access to water, healthcare, education, electricity with transport and other infrastructures crumbling. Many Ghanaians are excited about the discovery of crude oil in the country and its expected revenue. The general feeling is that, money is expected to flow to all pockets hence; politicians would be able to fulfill their election promises. For years Ghana has received billions of dollars from its gold export including timber and cocoa yet the living standard and lifestyle of its populace with most African countries has failed to improve.Who then is gaining from its revenue? The politicians and the multi-nationals companies.

The case of the Niger-Delta region in Nigeria a region of predominantly fishermen who have been rendered jobless without alternative due to crude oil extraction by government and multi-nationals companies sets a real example. Nigeria, a country with abundant crude oil and gas resources that has received over $400 billion from the sale of crude oil has over 80 million of its population living on less than two dollar daily. More frightening is the Niger-Delta region which produces 90% of the country foreign earnings has a very large pool of young able-bodied men unemployed. Nigeria used to be major cocoa and other cash crop producing hub but the discovery of oil has led to the collapse of other industries. Such dependence on has lead to severe consequences such as rising food prices, job and revenue losses.When oil prices fluctuates in the world market there is nothing to cushion the effects making the economy unstable and bringing untold hardship.

The oil producing and exporting countries of Angola, Gabon, Algeria, Libya and Equatorial Guinea are not any better. Millions of people in these countries live in abject poverty and in squalor conditions while the leaders live in opulence with luxury villas and numerous fat bank accounts in France, Switzerland, United States, Britain and their colonies of safe haven centers in Caymans Islands, The Channel Islands and the rest.The Late President Bongo of Gabon was suspected of having 59 plush posh apartments in France.The President of Congo Sassou-Nguesso fares no better he is believed to have 18 apartments and have 112 bank account and several luxury cars all bought from stolen crude oil revenues. President Obiang of Equatorial Guinea is believed to use of the country oil revenue to enrich himself, family members and close associates.

There is nothing to show in any of the above mentioned countries that majority of the population has benefited from oil revenue. It's a fact that citizens of these countries have fared worst off. Gabon has a population of 1.4 million people yet it was ranked 124 out of 177 countries in 2007 by the UNDP report on human development. According to the United Nations Development Program only 14 percent of Gabonese can afford a doctor's consultation. Gabon's total debt in 2007 stood at $2.5 billion including $ 1.1 billion owed to France, while the country imported more than 60 percent of its food with more than 30 percent of the population living on less than a dollar a day.In Angola there are reports that over three million Angolans are on the verge of famine. President Eduardo dos Santos, has appealed for international help, pleading that his government is broke. This from a country that the oil revenue is expected to rival that of Nigeria any time soon.

Almost all big oil companies operating on the continent share the blame because they have along history of helping corrupt leaders launder their loot in foreign countries. Elf executives admitted paying late President Bongo of Gabon close to $55 million dollars through almighty Swiss banks, every ready to do a dis-favour to the troubled continent. There has also being allegation by some senior company executive admitting to paying massive bribes to the following leaders Cameroon's Paul Biya and his counterparts in Congo, Angola and Equatorial Guinea. In 2004 Royal Dutch Shell of Netherlands admitted fuelling corruption, poverty and violence in Nigeria and toady June 9, 2009 has agreed to pay $15.5 million to the family of Ken Saro-Wiwa and the Ogoni eight for her complicity in their execution by the corrupt Abacha regime. Their secretive and non-transparent dealings with corrupt governments are no secret. In Angola, Western oil companies such as BP, Shell, ExxonMobil and Chevron stand accused of refusing to reveal their annual payments to the Angolan government a charge similar to those in Nigeria, Gabon, Congo, Algeria and Equatorial Guinea. These are the very same companies that are lining up to exploit Ghana's oil and there is nothing that shows they will operate any differently in the country.Oil corporations have a way of dealing with poor countries for example they can block credit.

The fear now is that like Ghana's neighbours in the region there is a high probability that the flow of oil money may encourage unscrupulous army officers and unelected Ghanaian leaders to take over the administration of the nation by force and drown democracy, breach human rights and suppress all dissent as happened during gold and diamond discoveries where army officers seized power overnight, stole as much as they could and mismanaged what remained of their loot with Ghanaians ultimately paying the price.
The above mostly extracted from this article

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