Africa map

The World’s Most Valuable Resource: Responsibility

By Iziah Thompson, Advocacy Intern

What does a drilling operation off the Ghanaian coast, Bob Dudley, President of BP and the International Monetary Fund all have in common? Other than the apparent fact that each deals with large sums of money, what is it that connects them? Each has a responsibility and duty from which come implications for an entire continent. What they have in common is that their decisions can change Africa for the good or perpetuate a cycle of poverty and corruption.

Natural resources, like oil, gas, minerals and metals are abundant and virtually untapped in the continent of Africa. Statistics project that the next ten years will yield more than $ 1 trillion worth of exported resources from the African continent.2 The extraction of these resources should mean great economic gain for its inhabitants. In some instances, it will and has already done so, but in other cases, it will only exacerbate pre-existing issues in the region.

American oil companies frequently make deals with African governments to work oil sites.7 They contract with smaller American drilling companies to come in and drill, and in the end, the African citizens are often left in the same condition that they were prior to all the precious resources being removed from under their feet. Because of the abundance of resources and possibility of deals like this being agreed to throughout the continent, many activists, political leaders, NGOs and government officials are calling for action to aid the people of Africa. Many are (1) demanding transparency for government budgets, (2) building awareness among citizens of the ways in which these deals affect their lives, and (3) advocating for revenues to be invested in local governments and citizens.

Imagine you are a Senegalese local of Kedougou, a town in southeastern Senegal. The region lies atop one of the world’s largest-scale mining operation; Senegal exports a plethora of valuable minerals and metals including gold, platinum, copper, lead, molybdenum, tungsten, diamonds, zinc, palladium, tantalum, vanadium.4 You have already lost the farm land that was sustained by your families for generations, and now you spend months on end moving about from mining site to mining site leaving your family behind to work for less than $2.00 a day. According to Lamine Daffé, of IOM Senegal,

[M]iners on these traditional artisanal mines use rudimentary tools and perform labour-intensive and hazardous work. Small groups of men and children work approximately 10 hours a day, digging 10- to 15-metre shafts, using makeshift pulleys to haul up bucketfuls of ore and pounding it to pan for gold using highly toxic mercury.1

The mines are filled with locals and immigrants who work in extremely hazardous conditions, without proper health care, and on small salaries. These types of operations often leave their communities in far worse conditions than prior to the inception.

The Senegalese have vast amounts of valuable metals, but most of the time, none of the money is returned to the communities where the exports are mined.1 Acres of land are taken and the owners receive inadequate compensation for their land.2 The situation in Senegal is one that many fear will be common across Africa within the coming years (based on the amount of resources that are projected to be extracted from the continent within the next ten years). Currently, China and India account for approximately half of the extraction operations, but the U.S. is quickly gaining traction in the hunt for oil wealth. Africa exports $300 billion a year in oil, gas and mineral exports. “300 Billion” is four times the amount of aid the continent receives in a year.2 But often the money being made is at the expense of the people because it fails to go to the construction of roads, hospitals or schools. Booming extract industries often result in an increase in poverty and powerlessness.

Currently in Sudan, we can see the political and economic power that resources, like oil possess. The Republic of South Sudan became independent from Sudan in July 2011. Since that day, Sudan shares its southern border with South Sudan. According to an Associated Press article, the President of Sudan Omar al-Bashir has warned oil companies in Sudan to prepare to cut off pipelines moving the South Sudanese oil supply.3 South Sudan relies completely on Sudan to ship its oil, which is its main export. The Sudanese government plans to halt all oil exports from South Sudan because it is believed that the South Sudanese government has supported rebel factions across the border in Sudan.3 Those close to the conflict claim that both sides have been responsible for supporting the opposition’s rebels. They are currently negotiating to prevent the halt.10 This situation has really shined a light on the fact that controlling oil and other resources significantly affects the continent.

Oxfam America is on the forefront of addressing this issue. In their new video campaign, they are asking why must companies like Exxon, Shell, and BP keep their records and deals hidden. Why are oil companies suing the government to prevent themselves from having to disclose their deals to the public? Oxfam President Raymond Coffenkeiser expressed the need for action on this issue. He called on President Barack Obama to take a stand for transparency and accountability where on his upcoming trip to Africa. Mr. Coffenkeiser asked the President to, “Shine a bright light on the lack of transparency and accountability that perpetuates cycles of poverty and inequality in developing African nations.”2

He requests transparency in government budgets, open payment from oil and mining companies to the right of transparency. Mr. Coffenkeiser argues that African citizens should be given knowledge about revenues from oil and mining companies.” “Let them fight for their own development,”2 he pleads; the money should be invested directly into local governments and citizens. Government budgets should be transparent and companies should disclose their revenues. Lastly, Mr. Coffenkeiser requests that Obama lead by example, by announcing when his administration will release U.S. Government aid data. The U.S. is one of the largest aid donors in the world and should not be one of the least transparent.2 Mr. Coffenkeiser sees great potential in Africa’s future economic growth.

Though Oxfam America is one of the most dedicated organizations in the call for change with oil companies and their deals in Africa, the issue has led to many notable figures supporting the cause. For example, Brad Pitt produced a documentary “Big Men,” directed by Rachel Boynton.5 The film follows how oil makes its way from the ocean floor off the Ghanaian coast to the U.S. stock exchange and the ensuing complications that accompany this process. It gives a critical look at what happens when the most valuable resource is found in one of the poorest places on earth. The film itself is a testament to the dangers that economic individualism pose.5 When leaders of nations along with companies decide to put a complete emphasis on maximizing profit, there is a cost associated, and the people usually foot the bill.

Political officials at the domestic and international levels have also given input on the topic. Senator Ben Cardin (D-MD) spoke on the necessity of transparency and stated that energy information should be in the public domain. The most moving words were from former Secretary General of the United Nations and Chair of the Africa Progress Panel Foundation Kofi Annan. In an Africa Progress Panel address, he asked us all to:

[I]magine an African continent where leaders use mineral wealth wisely, to fund better health, education, energy and infrastructure (…) Africa (…) has oil, gas, platinum, wisely use them to (…) improve the lives of millions of Africans (…). If we don’t it can fuel corruption…transparency and accountability are key (…).6 The issue is too big for Politicians and big business to handle alone without contributions from civil society (…) What are they doing? How much is it worth? How will the money be spent?6

These are fair questions for the big businesses that deserve answers.

The need for transparency and accountability is not some manifestation of human rights supporters’ imaginations. The facts are clear. More than 50% of citizens in Nigeria, Gabon, Equatorial Guinea and Angola, Africa’s biggest oil producers live on $2.00 or less per day. Angola along with Saudi Arabia is China’s largest oil supplier.8  West Africa alone provides 15% of the U.S.’s oil needs, and by 2015, it will increase to 25%.8 The role of oil and resources that do and will come from Africa is tangible and significant. When 500 oil and gas companies operate in West Africa, a region stricken with poverty, emphasis should be placed on why it is happening and whether it will continue.8

So we must bring the issues to the forefront and ask what clear effective approaches could be taken. Here are a few ideas:

  • There must be adequate consultation and representation regarding civil society with regards to oil contracts.9 This notion rests on the laurel that representation of people is one key to having a democratic, fair society.
  • Government officials whose jobs relate to resource management should have administrative powers waned if they do not have clear concise communication with the executive office.9 Without liaisons, the executive branch officials often act without much restraint. There is no accountability if they are allowed to serve in opulent positions with free range of power.
  • Public documentation must be provided where there is any resource revenue.9 This means whoever collected the revenue and whoever dispelled it must document earnings.
  • Doing business and respecting human rights must become the norm, not the exception.

Such protocols may begin to make it easier to effectively combat human rights offenses in African regions with regards to resources–steps which are imperative for the people of those regions.

There are those who look at Africa today and their eyes light up; their mouths salivate with the anticipation of the revenues to come. Milton Friedman wrote that “greed” is the engine that drives and motivates our economy. Maximum profit for an individual trumps all.5 But, when do we stop and ask, at what point is individualistic economic gain no longer permit exploitation? When does parlance and power jockeying come at too great a cost of a people’s well being? Now may be the point where it is decided whether greed will be allowed to continue the abuse of a continent or whether steps will be taken to raise a people with what we know is right. From the CEOs to U.S., Chinese and African governments to NGO presidents, it comes down to one word: Responsibility. Because individual responsibility may be the dictatorial factor for what is in store for Africa’s future.

 

Endnotes

1http://publications.iom.int/bookstore/free/GlobalEyeissue11_29Feb2012.pdf

2  http://allafrica.com/stories/201306261359.html

 3http://news.yahoo.com/south-sudan-shut-down-oil-industry-next-week-

141723303.html

4http://www.africaneconomicoutlook.org/en/data-statistics/

5http://www.rollingstone.com/movies/news/brad-pitt-produced-big-men-explores-greed-in-west-african-oil-exploration-20130421

6http://www.youtube.com/watch?v=kHY8WNcVWjc

7 http://csis.org/story/africa-china-united-states-and-oil

8 http://skyquadrants.com/projects/waow/

9 http://westafricaoilwatch.org/blog/2013-06-04/three-pillars-transparency

10http://www.rigzone.com/news/oil_gas/a/128136/Sudan_Says_Thaw_In_Relations_May_Prevent_South_Sudan_Oil_Halt

 

Other Resources:

Oxfam Ghana Video:  http://www.youtube.com/watch?v=e3BSPqJkwdI

In a measure of financial reform the Dodd-Frank Act has taken measures towards transparency for American companies:  http://www.cftc.gov/LawRegulation/DoddFrankAct/index.htm

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