There’s a reason for this you know

Donald Trump moved on Tuesday to expunge rules aimed at forcing oil companies to disclose payments made to foreign governments in order to secure lucrative mining and drilling rights.

“Trump has given an astonishing gift to the American oil lobby. Oil, gas and mining companies listed across the EU, including Russian companies, have already disclosed $150bn of payments in resource-rich countries, with no ill effects. This makes a mockery of claims by US oil companies such as Exxon that greater transparency would damage companies’ competitiveness. If the European companies can do it, you have to ask – what are US companies trying to hide?” said Zorka Milin, senior legal adviser at the advocacy group Global Witness.

Isn’t it Angola that bans companies from revealing how much they pay Angola?

10 comments on “There’s a reason for this you know

  1. I think it’s Angola yes, but I forget where I read it.

    This makes a mockery of claims by US oil companies such as Exxon that greater transparency would damage companies’ competitiveness. If the European companies can do it, you have to ask – what are US companies trying to hide?”

    This statement would carry more weight were ExxonMobil not an order of magnitude more competitive than the European oil companies…

  2. There are two structures for oil levies – taxation and production sharing. In taxation systems like the UK the terms are usually standard and public. In production sharing contracts – which keep the oil in the “possession” of the state for reasons of resource nationalism, and can have highly deleterious effects – the frameworks terms are usually public but specific deals are individually negotiated. In most PSA regimes (so most tax regimes set up after the 1980s) disclosure of the terms would allow companies to play the licences off against each other – “here, that bloke next door got a 20% rate, why are you asking for 40%, I want what he’s got” etc etc.

    From a game theory perspective it makes sense to keep disclosure of terms illegal (definitely the case in Angola, Indonesia and Cameroon I believe, and probably the case in all the others). The fact that it therefore produces complete opacity in government accounts is, I am sure, an unintended consequence. *cough*

    As an aside the richest woman in the WHOLE OF AFRICA is the daughter of the Angolan president. The richest woman in Venezuela is Chavez’ daughter. These are obviously complete coincidences.

  3. Angola? – ah yes … perhaps the Guardian could ask BP’s ex Lord Brown about that….

    Last I heard the dos Santos crew had stolen enough money to arguably become the largest landowners in erm… Brazil.

    The Guardian reporting on kleptocrats just doesn’t seem to happen – is it racist?

  4. Presumably the government of Angola doesn’t want the people to know just how much money is flowing through its hands? Because if they did know, they might demand that some of it be spent on them, and not on enriching corrupt officials.

  5. Andrew M

    The Angolan regime actually invaded Kabinda where most of Angola’s oil has historically come from aiui – and continue to brutally suppress any natives having the temerity to ask for schools / healthcare / infrastructure etc.

    The fiscal arrangement was that the President personally gets a royalty on each and every barrel nicked from his “fellow countrymen”.

  6. Presumably the government of Angola doesn’t want the people to know just how much money is flowing through its hands? Because if they did know, they might demand that some of it be spent on them, and not on enriching corrupt officials.

    That’s pretty much it, yes. Now I’m all for Western oil companies allowed to pick and choose which laws of the host country they get to adhere to, but most of their critics insist they should follow all of them to the letter.

  7. @tomo – the personal payment to the President that I’m aware of isn’t Angola but Gabon – for every licence back in the early 90s the licencee had to submit a fifty grand cheque to President Bongo’s Special Education Fund (made out to the President personally). At the time Gabon’s lteracy rate was well short of 50%

    And the reason the Graun doesn’t get exercised about Chavez and dos Santos and most of the other buggers is nothing to do with race – it’s because they’re nominally left-wing and anti-American

  8. @Flatcap Army

    I suspect that Kabinda is unusual – a special case even for Africa…

    The wheezes for extracting money from oyibos are many and varied.

    The Graun’s alacrity in bigging up thuggish kleptomaniacs fits in with the rest of the ignorant, warped partisan tripe that they offer as journalism.

  9. @Flatcap Army

    I’d also add that last time I looked Pres. dos Santos actually retained some fearsome reputation management outfits around the place. Anything in the MSM is pounced on quick-sticks.

  10. The Sultan of Brunei is my favourite. I wonder just how many MNCs employ him in some capacity or other to get round the corruption rules.

Leave a Reply

Name and email are required. Your email address will not be published.