{"id":7280,"date":"2015-03-20T07:30:32","date_gmt":"2015-03-20T07:30:32","guid":{"rendered":"https:\/\/africaresearchinstitute.org\/wordpress\/?p=7280"},"modified":"2022-02-21T15:50:26","modified_gmt":"2022-02-21T15:50:26","slug":"review-the-looting-machine","status":"publish","type":"post","link":"https:\/\/africaresearchinstitute.org\/wordpress\/review-the-looting-machine\/","title":{"rendered":"Book Review: The Looting Machine: Warlords, tycoons, smugglers, and the systematic theft of Africa’s wealth"},"content":{"rendered":"

Tom Burgis<\/a> is the Financial Times\u2019 investigations correspondent, covering business, politics, corruption and conflict. He was previously the FT\u2019s West Africa and southern Africa. His first book, <\/em>The Looting Machine: Warlords, Tycoons, Smugglers and the Systematic Theft of Africa’s Wealth<\/a>, uncovers the secretive networks that control Africa\u2019s natural resources and fuel its conflicts. <\/em><\/small><\/p>\n

Poverty in the midst of plenty: this paradox has endured in Africa from decolonisation to the era of ostensibly democratic states. At first it was explained by colonialism, then by the Cold War. Economists now call it \u201cthe resource curse\u201d, the perverse effect of globalisation that inserts Africa\u2019s minerals in our mobile phones and brings its oil to our petrol stations while inflicting misery and destruction on the people whose lands yield these riches.<\/p>\n

There are plenty of suspects to blame: corrupt dictators, criminal arms dealers, cynical multinationals and unscrupulous middlemen.  But is there a common thread to these iniquities? Is there a system that spans the oil banditry of Nigeria, the ravages of eastern Congo and the board rooms of South Africa\u2019s sophisticated mining industry, enriching the few at the expense of so many?<\/p>\n

A brilliant new book provides some answers: \u201cThe Looting Machine\u201d by Tom Burgis, who has covered Africa for the Financial Times since 2009. In fascinating detail, the book reveals how rulers of some of Africa\u2019s most impoverished countries channel vast natural resources through \u201cshadow states\u201d whose purpose is to enrich and preserve a tiny self-serving elite. The \u201cLooting Machine\u201d examines the secret deals between autocracies in Angola, Guinea, the DRC and Zimbabwe and their discreet business partners from Israel to China, moving prized assets to the world\u2019s great oil and mining companies and principal financial centres at a fraction of their true value.<\/p>\n

\"Africa<\/a><\/p>\n

The book lives up to its colourful subtitle \u2013 \u201cWarlords, tycoons, smugglers and the systematic theft of Africa\u2019s wealth\u201d. Showing the finesse and determination that has won him awards at the FT, and at considerable risk to his own well-being, Burgis tracks down and confronts the people at the centre of this plunder. He sees at first hand the privations, ethnic violence and state brutality suffered by the people who are governed by these predatory elites.<\/p>\n

This is a tale not of institutions but of the people who have bypassed them in their improbable rise to power and riches. When the young Joseph Kabila was chosen to replace his assassinated father as president of the DRC, he trusted so few in power that he turned for help to a young Israeli sent abroad by his famous diamond-trading family to seek his fortune. Now Dan Gertler is the DRC\u2019s mining kingpin, whose web of offshore companies is the link between a parallel bureaucracy and some of the world\u2019s biggest resource companies who acquired its assets for a song. Beny Steinmetz, also an Israeli, took time off from supplying diamond-encrusted steering wheels to Formula One racing drivers to seize half of Guinea\u2019s massive iron ore assets from mining giant Rio Tinto by offering a cut to the wife of the dying president Lansana Cont\u00e9 if he got the rights.<\/p>\n

The most mysterious of these business networks was set up by Sam Pa<\/a>, an obscure middleman with a few connections in Beijing who spotted the chance to forge a powerful link between official China and its largest oil supplier, Angola. Pa and officials in the Angolan state energy company created China Sonangol, a \u201ccorporate bunker within the already opaque walls of Sonangol,\u201d as Burgis describes it.<\/p>\n

\u201cThrough a network of obscure companies registered in Hong Kong, the Futungo<\/em> (a nickname for the elite in Luanda) had plugged itself into an offshore mechanism that channelled the political power of Angola\u2019s authoritarian rulers into the private corporate empire that Pa and his fellow founders of the Queensway Group had begun to assemble.\u201d<\/p>\n

Pa has never given an interview, and Burgis\u2019s doorstep interrogation of bemused staff at Queensway\u2019s Hong Kong head office provides one of the book\u2019s comic moments. Elsewhere in Africa, Pa has done deals with two rulers shunned by western governments and in need of cash to suppress the opposition \u2013 Guinea\u2019s former coup leader Captain Dadis Camara and Zimbabwe\u2019s Robert Mugabe. Pa\u2019s joint venture with Zimbabwe\u2019s secret police appears to have provided the cash for \u201cOperation No Return\u201d, which evicted workers from the alluvial diamond mine at Marange and turned it into the government\u2019s big money-spinner just in time for an election campaign.<\/p>\n

The continent\u2019s two leading oil producers have institutionalised the looting through their state energy companies, Nigeria\u2019s NNPC and its more efficient Angolan equivalent, Sonangol, while western companies co-operate. When Burgis revealed evidence in the FT<\/em> that Sonangol had licenced a massive oil field to a local company owned by its top executive, Manuel Vicente, and two senior army officers, these officials in effect admitted that this is how business in Angola is done. Vicente, pictured smiling with arms outstretched in an interview with the author, is now the country\u2019s vice president. The international operator of the oil block, the US-listed Cobalt International Energy, claimed it did not know who owned its local partner.<\/p>\n

The \u201cLooting Machine\u201d also analyses the failure of Black Economic Empowerment (BEE) in South Africa, the ANC\u2019s key policy to redistribute the country\u2019s wealth under majority rule. BEE has created multi-millionaires in the top ranks of the ANC who have swapped liberation credentials for a seat on the board of white-controlled companies, but left many of their black followers disillusioned. The resulting industrial unrest led to the massacre of workers by police at Lonmin\u2019s platinum mine at Marikana.<\/p>\n

The strength of the book is that it combines strong narrative with well-researched economic context, including the outflow of capital orchestrated by the multinationals through such practices as transfer pricing. It also cites a World Bank report on the lack of development brought by the Bretton Woods institutions\u2019 policy of liberalising the Africa\u2019s mining industry. This prompts a banker in Ghana to remark: \u201cPeople are asking: how did the country earn nothing from a hundred years of mining?\u201d There is also some historical perspective on contemporary plunder.  As one source puts it, Sam Pa is the modern-day Cecil Rhodes.<\/p>\n

In a world where all of us benefit from Africa\u2019s natural wealth, the author concludes, all of us are complicit.<\/p>\n

This review was written by ARI’s Paul Adams<\/a>.
\n<\/em>“The Looting Machine” is published by Harper Collins in the UK. <\/em><\/small><\/p>\n","protected":false},"excerpt":{"rendered":"

Paul Adams is full of praise for the way Tom Burgis has uncovered the secretive networks that control Africa\u2019s natural resources and fuel its conflicts.<\/p>\n","protected":false},"author":7,"featured_media":13075,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_uf_show_specific_survey":0,"_uf_disable_surveys":false,"footnotes":""},"categories":[17],"tags":[64,781,1405,1414,1422,1417,1424,388,181,1413,1415,1416,1404,264,1411,1420,1421,1419,121,837,1408,1412,1426,1373,303,1410,170,1406,1409,1423,1430,1428,1429,1425,1427,180,1418,1407,1401,252,1398,1402,1397,1400,1399,1403,115],"class_list":["post-7280","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog","tag-africa","tag-angola","tag-bandit","tag-beny-steinmetz","tag-black-economic-empowerment","tag-blood-diamond","tag-captain-dadis-camara","tag-china","tag-corruption","tag-dan-gertler","tag-diamond","tag-diamonds","tag-dictators","tag-drc","tag-financial","tag-financial-times","tag-ft","tag-futungo","tag-globalisation","tag-guinea","tag-israel","tag-joseph-kabila","tag-lonmin","tag-luanda","tag-marikana","tag-mining","tag-nigeria","tag-oil","tag-oil-and-mining","tag-operation-no-return","tag-platinum","tag-predator-elite","tag-predatory-elite","tag-queensway-group","tag-resource-curse","tag-robert-mugabe","tag-sam-pa","tag-shadow-states","tag-smugglers","tag-south-africa","tag-the-looting-machine","tag-theft","tag-tom-burgis","tag-tycoons","tag-warlords","tag-wealth","tag-zimbabwe"],"aioseo_notices":[],"yoast_head":"\nBook Review: The Looting Machine: Warlords, tycoons, smugglers, and the systematic theft of Africa's wealth - 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