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Why Are So Many African Governments Corrupt? Ask The Corporations.

Dena Montague | 22.05.2003 23:43

While the Nigerian Court of Appeals recently ordered Shell to pay the Ogoni people approximately $2 million for environmental damage, few Nigerians anticipate Shell will actually make payments in the knowledge of their past financial support to the notoriously corrupt and violent Nigerian security forces during the Ogoni uprising in the 1990s. Meanwhile, Halliburton Company was forced to admit it paid a $2.4 million dollar bribe to a Nigerian government official in exchange for tax breaks.

Ref:  http://www.blackelectorate.com/print_article.asp?ID=875
Recently Halliburton Company was forced to admit it paid a $2.4 million dollar bribe to a Nigerian government official in exchange for tax breaks. Payments were made in 2001 and 2002 by Halliburton subsidiary Kellogg Brown and Root. Halliburton has been involved with several large-scale projects in Nigeria. In 1999 Kellogg Brown and Root began
what was then one of the largest construction projects in Africa; a major expansion of Nigeria's liquefied natural gas plant in Rivers State. Halliburton has been active in the Niger Delta and has several collaborative projects with Nigeria's largest oil producer, Shell Petroleum Development Company, including development of the first major offshore oil and gas facility for Shell.

Shell has a sordid history in the Niger Delta. Last month the company was ordered by Nigerian Court of Appeals to pay the Ogoni people approximately $2 million for environmental damage. Few Nigerians anticipate Shell will actually make payments to the Ogoni. What Shell has made are direct payments to notoriously corrupt and violent Nigerian security forces during the Ogoni uprising in the 1990's leading to the execution of environmental and human rights activist Ken Saro Wiwa. The company has also imported arms on behalf of the Nigerian police. Recently Shell was forced to shut down operations due to political unrest in Rivers State related to the oil industry.

Rivers State where much of Halliburton's interests are concentrated has drawn attention not only for the political unrest in the State but also has been cited because of widespread electoral fraud organized by President Obasanjo's ruling PDP party. Oil companies in Nigeria see
Obasanjo as a strong ally due to his oil friendly policies. A summary of findings by Nigerian Civil Society found that a free and fair voting environment across Nigeria was "the exception rather than the rule." In some areas voting malpractice was "part of a systematic plan to either
disenfranchise the voters or distort the votes."


The UN Office for the Coordination of Humanitarian Affairs reported:

The Justice Development and Peace Commission which deployed 30,000 observers across Nigeria "described as 'incredible' official results showing nearly 100% turnout in southern Rivers State with 2.1 million of 2.2 million registered voters casting their ballot for the ruling party on a day when observers reported a low turnout. And in the volatile oil-rich Niger Delta, ethnic Ijaw militants questioned
electoral commission figures showing a 98% turnout near the oil town of Warri. Weeks of fighting between Ijaws and people from rival Itsekiri and a boycott organized by Ijaw militants ensured there was practically no voting in the area. An electoral official assigned to work in the area told UN Integrated Regional Information Networks (IRIN)
that top politicians in Obasanjo's PDP had taken home electoral materials and ballot boxes which they filled and returned."

While most Nigerians acknowledge widespread fraud in recent Presidential and National Assembly elections, Official U.S. reaction to the Nigerian elections has been supportive of Obasanjo and his ruling PDP party. U.S. Ambassador to Nigeria, Howard Jeter claimed the elections in Nigeria,
"had sent a signal to the rest of the world that the country was consolidating its democracy."

Vice President Dick Cheney's former company, Halliburton has helped develop projects in at least 20 African countries, including providing military support in Somalia and Mobutu Sese Seko's Zaire as well as assist in the development of deepwater exploratory offshore wells in
Angola and Equatorial Guinea.

At the same time the Halliburton bribery scandal broke another scandal was revealed by The Independent involving ExxonMobil and another oil rich African country - Equatorial Guinea. ExxonMobil is facing an investigation into an alleged payoff of up to $500 million transferred
into a private US bank account apparently controlled by the president of Equatorial Guinea. Ken Silverstein has written an excellent piece on the politics of oil in Equatorial Guinea entitled "Oil and Politics in the 'Kuwait of Africa'" describing rampant corruption and poverty in the oil rich state while oil executives actively court the state for favorable oil deals.


Dena Montague is a Senior Research Associate with the Arms Trade Resource Center of World Policy Institiute and can be contacted via
e-mail at: montd033 @newschool.edu


RESOURCES FOR MORE INFORMATION

"Oil and Politics in the 'Kuwait of Africa'"
 http://www.thenation.com/doc.mhtml?i=20020422&s=silverstein

HRW report - "The Price of Oil: Corporate Responsibility and Human Rights Violations in Nigeria's Oil Producing Communities"
 http://www.hrw.org/reports/1999/nigeria/

Nigeria: Civil Society on Elections
 http://www.africaaction.org/docs03/nig0305.htm

Africa News
www.allafrica.com

Dena Montague
- e-mail: montd033 @newschool.edu
- Homepage: http://www.thenation.com/doc.mhtml?i=20020422&s=silverstein

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