The Economist: Oil in Africa: The black curse

Apr 19th 2007

LIKE the cars that might one day make the Western world a bit less reliant on crude oil, “Untapped” is a hybrid; part travelogue, part analysis and part lament. It is also well timed. Energy security has become an obsession for the rich world. And some, especially in America, have argued that the supposedly limitless supply of African crude is the key to reducing the West’s over-dependence on politically risky Middle Eastern supplies. This book examines the consequent boom in oil production and exploration that is currently sweeping across Africa, and the effects that this may have on the continent. None of it makes for pretty reading.

The author begins his travels in Nigeria, where Royal Dutch Shell started off Africa’s relationship with the modern oil industry by striking black gold in the Delta region in 1958. But for all the billions of dollars that Nigeria’s oil has fetched on the world markets since then, the country itself has virtually collapsed. It may be the seventh-largest producer of crude in the world, but Nigeria remains one of the poorest as well—an original example of “resource curse”. Nearby Gabon followed soon after.

The question Mr Ghazvinian sets is whether the countries now leading the oil boom, such as Angola, South Sudan and Equatorial Guinea, can expect much better. His answer is a resounding no. In the past, all that oil wealth has done for Africa is to entrench chronically corrupt politicians who squander the money while throwing their impoverished citizens a few prestige white-elephant projects to keep up the pretence of “development”. This pattern, he argues, is unlikely to change.

Travelling to Angola, for example, the author finds few of the political, legal and institutional frameworks that might prevent that country from becoming another Nigeria. The situation is even worse in Equatorial Guinea, perhaps Africa’s most venal regime, which is kept afloat on a slick of Western petrodollars.

His findings may not be surprising, but Mr Ghazvinian adds value by detailing America’s deepening involvement in Africa at a time when eyes are on what China is doing there. In many cases it is America’s oil majors that are making the running, with its politicians and diplomats, worrying about energy insecurity, rarely far behind. America is getting into bed with some very nasty, or at the least undemocratic, regimes at the same time as it preaches human-rights to Sudan’s admittedly awful president, Omar al-Bashir.

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