Today, the Angolan government will reportedly
formally disclose, for the first time, information about revenues that
it will receive from a multinational oil company working in its country.
The payments, totalling $300 million, are to be made by US oil giant ChevronTexaco
in a deal on a 20-year extension of Chevron’s Block Zero concession in
the north of Cabinda province. The deal is to be signed in Washington DC
today as part of President dos Santos visit to the US.
This disclosure may be a first step
to improve the transparency of Angola’s oil income, which has previously
been subject to wholesale diversion and theft by members of the country’s
elite. Global Witness’ recent report Time for Transparency (see www.globalwitness.org
) details how over US$1.5 billion per year, a quarter of Angola’s state
income, has gone missing in recent years. The report also reveals that
large sums of money have been diverted to secret bank accounts abroad owned
by the President.
The Angolan government must now put concrete
measures in place to address oil revenue mismanagement and misappropriation.
Publishing Chevron’s signature bonus is a step forwards, but billions of
dollars of taxes and royalties paid by companies in Angola remain unaccounted
for. State oil company Sonangol also remains an accounting ‘black hole’
and the Angolan government continues to mortgage the country’s oil income
by taking out expensive and opaque oil-backed loans from international
The government’s clean-up effort will
only be credible if double-checks are built into Angola’s oil accounting
system. Global Witness wants companies to publish what they pay to the
government, the government to publish what it receives, and any discrepancies
to be publicly investigated by a reputable auditing institution. President
Obassanjo of Nigeria has recently committed his country to this kind of
Angola should also now join the UK-led
Extractive Industry Transparency Initiative, which has already done much
of the work on how best to report and account for oil income. So far the
Angolan government has rejected the initiative, casting doubt on the seriousness
of their reform efforts.
Sarah Wykes of Global Witness said, “numerous
past promises by the Angolan government to improve its oil accounting have
come to nothing. The Angolan Government must now join the EITI, adopt double
disclosure bookkeeping of its oil revenues, and enshrine this system in
national law. There is a real danger that once the Angolan Government obtains
a positive decision on access to debt relief and IMF funding, transparency
reforms will simply be abandoned.”
For further information, call
Sarah Wykes or Gavin Hayman on +44 (0) 207 561 6362/61 or +44 (0)7971 06
1. Global Witness focuses on the links
between the exploitation of natural resources and the funding of conflict
and corruption. It is non-partisan in all its countries of operation. Global
Witness has been co-nominated for the 2003 Nobel Peace Prize for its leading
work on ‘conflict diamonds’. Global Witness March 2004 report, Time for
Transparency (available at ) contains extensive details of wholesale looting
of Angolan oil revenues.
2. Global Witness is one of the founder
members of the Publish What You Pay campaign, which was launched in June
2002 and now has more than 190 members (see www.publishwhatyoupay.org).
The coalition calls for stock market and international accounting rules
to require oil, gas and mining companies to disclose their net payments
to governments for resource access on a country-by-country basis. The coalition
believes that revenue transparency is an essential condition for alleviating
poverty, promoting just and equitable development, improving corporate
social responsibility, and reducing corruption in many resource-rich developing
3. In addition to requiring companies
to disclose their revenues, it is important to increase the transparency
of government revenue streams from production sharing agreements and state-owned
companies. Global Witness is calling for the imposition of appropriate
conditionality on relevant bilateral and multilateral development assistance
and loans, resource-backed loans from banks, and export credit agency funding.
4. The UK Government has launched a voluntary
initiative to encourage best practice in disclosure of revenues by companies
and governments called the Extractive Industries Transparency Initiative.
More information is available at: www.dfid.gov.uk.