Multinational corporations: The new colonisers in Africa

Written by admin on April 8th, 2011

worth of resources. Global Financial Integrity says that ‘0 billion is secreted each year from underdeveloped economies, with an estimated .5 trillion currently stashed in havens. More than one quarter of these hubs belong to the UK, while Switzerland washes one-third of global capital flight.’ Of this 0 billion, 0 billion comes from Africa.

‘The idea that Switzerland has a clean economy is a joke; it is a dirt-driven economy,’ says Richard Murphy, director of Tax Research LLP. The Swiss Bankers Association claims that four-fifths of the nation supports banking secrecy, which reveals a society deeply embedded in a culture of impunity and exploitation. The fact is that those who steal must find a way to hide their loot, and Switzerland provides the ideal environment for such crimes to take place. And it is not Switzerland alone that does not have a clean economy. Britain, France, Germany, Luxembourg can all be described as vampires.

In her article ‘Capital flight: gingerbread havens, cannibalised economies’, Khadija Sharife writes:

‘This policy is especially lethal for developing countries where the poor are now caught in tax brackets, courtesy of the IMF and World Bank’s structural adjustment programmes (SAPs), instituting policies ranging from “tax holidays” to the privatisation of state services [and] carving out huge slices of natural capital at corporate auctions… Africa has collectively lost more than 0-billion in capital flight, excluding other mechanisms of flight including ecological debt (globally estimated at a potential .8-trillion per annum), the cost of liberalised trade (just under 0-billion) … and the list goes on…'[4]

Thus with the support and collusion of the IMF and the World Bank these corporations are paying close to nothing for the resources they take from Africa.

Africa has been labelled the world’s most corrupt region because multinational internal mis-pricing makes up 60 per cent of capital outflow, with corporations declaring profits in tax havens, as opposed to the country of performance. Corporations declare about 40 per cent of their profits in the African countries where they operate, siphoning the rest into their safe-haven accounts in order to avoid paying tax which could be used to eradicate poverty. And this is not the end of the corruption and the story of daylight robbery.

We know how Elf operated as an arm of the French state supporting dictators, looting resources and establishing a flush fund used to bribe African leaders to look the other way while the corporation looted Africa’s oil and gas.

The author of Poisoned Wells Nicholas Shaxson wrote of the subject: ‘Magistrates discovered the money from Elf’s African operations supplied bribes to support French commercial, military and diplomatic goals around the world. In exchange, French troops protected compliant African dictators.’

This explains why there are so many more corrupt dictators in French-speaking Africa compared with elsewhere in Africa. Gabon’s Omar Bongo, Togo’s Gnassingbé Eyadéma, Zaire’s Mobutu Sese Seko, Guinea’s Lansana Conté, Côte d’Ivoire’s Félix Houphouët-Boigny, Burkina Faso’s Blaise Compaoré, Congo’s Sassou Nguesso and Chad’s Idriss Déby are some of the compliant leaders who were or have been protected by France. And what happened to the non-compliant African leaders? Your guess is as good as mine. Please find time to read more about Bob Denard, a Frenchman who made a career as a mercenary overthrowing African leaders. French author Jean Guisner says: ‘Denard did nothing that was contrary to French interests – and he allegedly acted in close cooperation with French intelligence services’.

In the Elf corruption case André Tarallo, the real boss of Elf-Afrique, ‘told the court in June 2003 that annual cash transfers totalling about £10m were made to Omar Bongo, Gabon’s president, while other huge sums were paid to leaders in Angola, Cameroon and Congo-Brazzaville. The multi-million dollar payments were partly paid to ensure the African leaders’ continued allegiance to France. In return for protection and sweeteners from Elf’s coffers, France used Gabon as a base for military and espionage activities in West Africa.'[5] 

The real deal is that Elf, Shell, BP and their counterparts in Europe and America pay bribes to African leaders to induce them to look the other way when they plunder resources. Ask any Gabonese or Congolese whether they have benefited from the oil and diamonds and the answer will be a big no. What is so tragic is that the people know they have oil, diamonds and see these companies processing them everyday yet do not know where it goes, who buys them and where the proceeds go.

In the UK former Prime Minister Tony Blair was accused of selling a device based on ageing technology to Tanzania. ‘The UK sold a useless air traffic control system to Tanzania in 2001 in a scandalous and squalid deal, the House of Commons was told.’ Clare Short, an minister of parliament, said, ‘The deal was useless and hostile to the interests of Tanzania.’ She continued, ‘Barclays Bank had colluded with the government by loaning Tanzania the money, but lying to the World Bank about the type and size of the loan.’ Short said, ‘Tanzania could have paid much less for the same equipment which cost them £28m’. Shadow International Development Secretary Andrew Mitchell said ‘BAE had used ageing technology and said the system was not adequate and too expensive.'[6] 

And it all happened after they had bought Tanzania officials to look the other way while a device based on ageing technology was being sold to the country. BAE colluded with Tony Blair and Barclays Bank to sell a useless commodity at an exorbitant price to Tanzania. This is nothing but a continuation of the contempt and impunity with which Europeans have traditionally treated Africa before, during and after colonialism. BAE is indirectly saying that Africans do not deserve the latest technology even if they pay a cut-throat price. It is also a message to Africans that they must develop their own technology and not rely on the generosity of others.

It is no secret that the Shell oil company colluded with Nigeria’s corrupt Abacha regime to steal oil, pollute the country’s rivers, wells, creeks and soil and render millions of farmers and fishermen in the Niger Delta jobless. ‘[Shell] admitted that it inadvertently fed conflict, poverty and corruption through its oil activities in the country. Nigeria contributes to about 10% of Shell’s global production and is home to some of its most promising reserves, yet the country is steeped in poverty and conflict.'[7] So Shell, in addition to stealing Nigeria’s oil and polluting its rivers, wells and soils, also promotes corruption, poverty and conflict.

In the DRC about five million people have died in a war, the underlying motive for which is the satisfaction of the West’s insatiable appetite for high-quality, low-price cell phones, laptop computers, Playstations, jewels, diamonds and coltan. And in Paris, London, Brussels, Berlin, New York or Washington, who cares about five million deaths anyway? Why has the DRC’s war not ended? Who supplies the rebels their arms and who buys the minerals they mine illegally? Why have Ugandan and Rwandan forces crossed several times into DRC? And whose agenda are they pursuing? A report by the UN says it all.

The panel calls for financial restrictions to be levied on 54 individuals and 29 companies it says are involved in the plunder, including four Belgian diamond companies and the Belgian company George Forrest, which is partnered with the US-based OM Group.

The individuals named include Rwandan army Chief-of-Staff James Kabarebe, Congolese Minister of the Presidency Augustin Katumba Mwanke, Ugandan army Chief-of-Staff James Kazini and Zimbabwean Parliament Speaker Emmerson Mnangagwa, BBC online reported.[6] The report also accused 85 South African, European and US multinational corporations – including Anglo American, Barclays Bank, Bayer, De Beers and the Cabot Corporation – of violating the Organization for Economic Cooperation and Development’s (OECD) ethical guidelines on conflict zones.

The guidelines they were accused of violating relate to arming Rwandan, Ugandan and Congolese rebels and profiting from their illegal looting of Congo’s minerals, as the following excerpt shows:

‘Despite the recent withdrawal of most foreign forces, the exploitation of Congo’s resources continues, the report says, with elite networks and criminal groups tied to the military forces of Rwanda, Uganda and Zimbabwe benefiting from micro-conflicts in the D.R.C. “The elite networks derive financial benefit through a variety of criminal activities, including theft, embezzlement, [the] diversion of public funds, [the] undervaluation of goods, smuggling, false invoicing, non-payment of taxes, kickback[s] to public officials and bribery,” and added that such pillaging is responsible for much of the death and malnutrition in eastern D.R.C.'[8]

And so while millions die in Africa with the complicity of these corporations, European and North American citizens, with all their hypocrisy, live to enjoy lavish holidays. And when Africans try to reach Europe the citizens say ‘Europe is full. No more immigrants.’ Where do the queens and kings in Europe get the diamonds and gold that they show off? Is it not from the blood diamonds from Congo, Sierra Leone and other conflict zones in Africa that are smuggled out and sold in Brussels, Zurich, London and New York? 

And this is not their only crime. We know how Halliburton established a 0-million flush fund and bought Nigerian officials to secure a -billion oil contract. We know Acres

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