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Report Accuses Leaders of Many Developing Countries of Misuse of Energy and Mining Revenues - 2004-03-24

A British anti-corruption charity says the leaders of many developing countries are colluding with international oil, gas, and mining companies to skim off profits that could help lift nations out of poverty.

The report released in London details what it calls "a global epidemic of financial scandal" in the misuse of energy and mining revenues.

Global Witness has campaigned for more than a decade against corruption in the world trade of natural resources. Previous reports have focused on logging and the diamond trade. The new report examines oil and mining operations in five countries, most of them in sub-Saharan Africa.

A spokesman for Global Witness, Diarmid O'Sullivan, told VOA that oil-rich Angola is of particular concern.

"The worst example is Angola," he said. "Something like $1.7 billion of Angolan state money, which is mostly oil money, could not be accounted for. Now, if you have a situation where something like one in four oil dollars are unaccounted for and one in four children are dying before the age of five because of diseases that could be cured, there is obviously a major problem."

Mr. O'Sullivan says there should be an end to secret payments by international oil and mining companies to developing world governments for the right to exploit natural resources.

"Oil and mining companies do not declare what they are paying to the governments and the governments do not declare what they are receiving or what they are doing with the money," said Diarmid O'Sullivan. "And the result is we found strong evidence that billions of dollars is unaccounted for and in some cases may actually be going to enrich people connected to those governments."

The Global Witness report says a multi-faceted international effort is required to combat the problem. It suggests publicly traded energy and mining firms should be obligated to disclose payments made to governments.

It says Western countries should use diplomatic pressure on developing countries to clean up corruption. And it says international lending institutions should cut off money to any country that refuses to publicize the income received from energy and mining interests.