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Daylight robbery of Africa's natural resources
July 9, 2017, 11:19 am
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Africa has for centuries been a mute victim of exploitation by outsiders, of its people, its natural resources, its wildlife — it is only in more recent history that the continent has been manipulated by its own people, whether its leaders, politicians or businesses.

From the slave trade that began in early 15th century to the plundering of its natural resources during colonial rule, from political upheavals and ethnic conflicts following independence to the continued ravaging of African extractive resources by multinational companies, it is the continent and its people that have been left impoverished, economically and socially.

A new report by global management consulting firm McKinsey & Co., shows that natural resource extraction contributes more than 30 percent of Africa's GDP, and that resource extractive industries will only “continue to profit given the rising global demand for oil, natural gas, minerals, food, arable land, and the like".

According to Carlos Lopes, the former executive secretary of the United Nations Economic Commission for Africa (UNECA), "Average net profits for the top 40 mining companies grew by 156 percent in 2010 whereas the take for governments grew by only 60 percent, most of which was accounted for Australia and Canada, countries that have stringent mining and export rules in place." He further pointed out that the profit made by the same set of mining companies in 2010 was $110 billion, which was equivalent to the merchandise exports of all African Least Developed Countries (LDCs) in the same year.

"It is fair to say therefore that the resource-to-development model puts raw materials suppliers at a significant disadvantage and is not working to bring about equity or boost development for the supplier countries," noted Mr. Lopes.

It is abundantly clear that many multinational mining corporations conduct their business transactions in a manner that is legally questionable, morally reprehensible and definitely exploitative. Africa does not need charity or aid dole-outs, what it needs is for the United Nations, global financial institutions and governments that host multinational mining corporations, to do their part to ensure these companies are held accountable for many of their illegal accounting practices that allow them to steal African wealth in broad daylight.

African extractive sector provides huge opportunities for sustainable development and poverty reduction on the continent, but only if it is properly managed. While the right mix of government policies and implementation are crucial to sustainable mining and extraction of natural resources, so too is the presence of vigilance mechanisms and enforcement systems to ensure transparency and deter corruption.

The responsible governing and sustainable administration of natural resource wealth could be a boon to the continent, enabling valuable investments in infrastructure, human capital, social services, and other public goods. However, to safeguard public assets and hold management of state-owned enterprises responsible for any transgressions it is critical to have an alert public, a strong parliament with a vigilant opposition, and an active impartial media willing to probe and free to publicize any wrongdoings. This is sadly lacking in many countries on the continent.

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