Africa Confidential

www.africa-confidential.com 5 March 2004 Vol 45 No 5 AFRICA CONFIDENTIAL SOUTH AFRICA 2 UGANDA A ten-year test The ANC’s review of its first ten Double war years in power claims great strides Rebel massacres and party activists are shaking the National in providing housing, water and Resistance Movement’s political dominance electricity but has much less to say As pressure mounts on President Yoweri Kaguta Museveni to leave power by 2006 at the end of his about progress in cutting unemployment and HIV/AIDS. second elected term, both the military war in the north and the political war in the south are going badly for the government (AC Vol 44 No 24). Museveni’s political standing is based on the National Resistance Movement’s restoration of order in much of Uganda after the horrendous conflicts of the 1980s and its SA/CONGO-KINSHASA 4 willingness to reform the economy and establish an accountable form of government. All three are threatened by the current turn of events. Peace dividend With just two years to go, there seems little prospect of an orderly succession within the ruling NRM, Dreams of harnessing Congo’s let alone the possibility of free elections, which an opposition party or coalition might win. The volume massive hydroelectric resources to is literally being turned up in the war of words between opposition parties and the NRM. To counter the power Southern Africa and beyond popular, independent FM stations which regularly excoriate the government, two NRM loyalists, Local are moving towards reality. So too are the plans for the mining giants to Government Minister Tasisi Kabwegere and member of parliament William Sienda Sebalu are setting start new projects after Mbeki’s long up City FM to cover most of Uganda, including key rural areas, with a pro-government message. diplomatic engagement there. Ominously, the station will be run by Major Roland Kakooza Mutale, former head of the Kalangala Action Plan, a roughneck paramilitary group which tried to intimidate voters in the 2001 elections. Talks between government and political parties, chaired by Movement Political Commissar Crispus AFRICA/DIAMONDS 5 Kiyonga, are floundering. The leaders of the three traditional parties – James Rwanyarare of the Rough diamonds Uganda People’s Congress, Paul Ssemogerere of the Democratic Party and Conservative Party leader Joash S. Mayanja-Nkangi – boycotted the talks after failing to agree pre-conditions. DiamondWorks company is moving into oil trading and exploration – and banking. Sceptics question the A party for Museveni reality behind the hectic activity. The ‘National Resistance Movement Organisation’ has finally registered as a party but oppositionists reject this, charging it has unfair access to government coffers. The mushrooming of political parties (53 have registered) undermines the opposition. Its best chance of success would be the mooted coalition between the traditional opposition parties and the activists (mainly ex-NRM) grouped under the Reform NIGERIA 6 Agenda. That may account for the rising political temperature in the south. Anenih’s irresistible Opinion is divided about the spate of atrocities by Lord’s Resistance Army fighters in the north. In early January, the Ugandan army commander, Major General Henry Aronda Nyakairima, made yet another rise prediction of victory against the LRA after the Uganda People’s Defence Forces scored some significant After the murder of A.K.Dikibo, successes. Then the LRA responded, with two devastating attacks on camps of displaced people. It killed political veteran Anthony Anenih has some 50 people outside Lira in early February and 200 in the Barlonyo massacre at the end of the month. emerged as Chairman of the ruling UPDF intelligence was improving: the army claimed to have neutralised ‘Gen.’ Yadin Charles PDP’s trustees, pegging level with party Chairman Audu Ogbeh. Tabuley, alleged to have led LRA incursions into eastern Uganda (and previously reported dead); along with ‘Gen.’ Acelam, the chief of military intelligence; army commander Yadin Tolbert Nyeko (also previously reported dead) and the shadowy ‘Gen.’ Dominic Ogwen, said to have been a senior director GAMBIA 6 of LRA operations. The LRA’s deputy leader, Vincent Otti, and followers were said to have been forced back into Sudan. What is certain is that the LRA’s leader, Joseph Kony, remains armed, active and living Babagate or floodgate in National Islamic Front-controlled areas of southern Sudan. Gambians question President The massacres involved about 300 LRA raiders instead of the more usual 30-40. Local religious Jammeh’s anti-corruption leaders, among the few to keep contact with the LRA, said they were a publicity stunt in reply to campaign: many see it as a front to government victory claims. They attracted large numbers of foreign journalists and if the LRA’s leaders deflect Western critics or, more dangerously, to settle old scores. want publicity, they may be tempted to embark on an even greater slaughter next time. Museveni visited the district, apologised for the UPDF’s mistakes and removed the local commander, Lieutenant Colonel Emmy Mulindwa. The local volunteer militias, meant to be the cornerstone of POINTERS 8 security strategy for protecting civilians, had proved incompetent. Militiamen complained about inadequate training, insufficient arms and late pay. Nigeria/USA, Congo- The LRA’s latest tactics are fuelling ethnic hatred: the LRA leadership is Acholi and most of the victims K, Algeria & Western in the last two massacres were Langi. In Lira after the Barlonyo massacre, Langi rioters beat a man to Sahara death and burned Acholi property; a Lira District councillor, Franco Ajur, and Joe Wancha of Radio Wa, a Langi station, were accused of making inflammatory statements. In the Acholi town of Gulu there 5 March 2004 Africa Confidential Vol 45 No 5

were reprisals against Langi people. qualified to fill them. The obvious long-term answer is more and better Kampala’s official line on Sudan is that it no longer backs the LRA: education and training. Better-educated Zimbabweans flock across Uganda doesn’t want to be accused of backing Col. John Garang de Beitbridge to take these jobs, helping South African firms to prosper Mabior’s Sudan People’s Liberation Army/Movement. Senior but stirring local resentment. Relaxing immigration rules to attract Ugandan officials say they are satisfied that Sudan’s President Omer skilled foreigners could give the economy a quick fillip, since each Hassan Ahmed el Beshir, and Defence Minister, Gen. Bakri Hassan doctor, banker, accountant or mechanic creates jobs for several unskilled Salih, no longer support the LRA and have tried to curb abuses by workers. However, an influx of qualified Congolese, Ghanaians, rogue Sudanese army officers. The NIF regime still stands accused of Nigerians and Zimbabweans – even some Europeans – would do little failing to help flush Kony out of his safe haven in Sudan. Privately, the for community relations. officials say Khartoum still backs the LRA. After his State of the Nation address in early February, President Having apologised, Museveni returned to his usual confident tone. Thabo Mbeki sounded a bit smug: ‘We do not foresee that there will He again claimed that, by restricting defence spending, donors had be any need for new and major policy initiatives’. He added that the frustrated government efforts to defeat the LRA. Diplomats protested task for the decade would be to ensure ‘the vigorous implementation vigorously, in a statement signed by British High Commissioner of these policies’. Mbeki seemed to be suggesting that holding the ship Adam Wood and United States Ambassador Jimmy Kolker. steady was the only way to bring about ‘the winning, people-centred, The recent massacres embarrass the USA, which had claimed society of which Nelson Mandela spoke’. Along with the steady ship, success in helping with UPDF training, intelligence and logistics. This a much faster rate of growth is needed to lift more than 7 mn. South had made all the difference, one source told Africa Confidential. There Africans who live below the national poverty line. are also reports of British troops helping with training. The initiative How to achieve that growth remains central to political debate. The for a peaceful settlement remains stalled although a row between the mainstream ANC position articulated by Mbeki and Finance Minister Presidential Commissioner in Gulu, Max Omeda, and Father Carlos Trevor Manuel is that the neo-liberal economic strategy of balanced Rodriguez, a leading peace campaigner, has calmed. Church leaders budgets, lower direct taxes and phased privatisation is building the have provided some of the few positive signs of peace talks. Rodriguez foundation for sustained growth. The proof, Manuel said, is that he had criticised the army and still opposes an investigation by the was able to report in his budget speech last month, ‘the longest period International Criminal Court into LRA war crimes, saying this could of continuous growth for over 50 years – 20 consecutive quarters’. make a negotiated settlement impossible. The difficulty is to know That may be true but the growth has not been fast enough – how to negotiate with an armed group which seems to have no policies, averaging 2.75 per cent over the past five years – to make massive cuts no specific demands and no mercy. in either poverty or joblessness. Manuel forecasts growth of 2.9 per cent this year, though, rising to 3.6 per cent and 4 per cent in 2005 and 2006 respectively. Whether or not this is his last budget, as financial SOUTH AFRICA pundits believe, his international standing remains high: should he leave politics, he would be assured of a senior position in a major international financial institution. His appointment to British Prime A ten-year test Minister Tony Blair’s new Commission on Africa (AC Vol 45 No 4) means he will be working closely with his friend and colleague, UK The government set itself an examination Chancellor Gordon Brown. and, not surprisingly, it passed Two months before elections, Manuel’s budget was a restrained With national elections just over a month away (AC Vol 45 No 3), the attempt to target more public spending at the poorest: his Expanded African National Congress government has formally assessed its first Public Works Programme (EPWP), has loosened the brakes on public ten years. Not surprisingly, it awards itself full marks for trying. The spending, held down in recent years as much by government agencies’ tally of pluses and minuses (see Box) outlines the economic and social inability to spend their budgets as by policy restraints. The overall conundrums that confront any ambitious regime. budget deficit is set to rise from 2.6 per cent of gross domestic product Unemployment, which cannot be accurately measured, is officially in 2003/4 to 3.1 per cent in the coming year, giving a further push to estimated at just under one in three (31.2 per cent) of the economically the steady rise in social spending. This has moved from 44 per cent of active population, under a government that promised, and intended, to the total budget in the early 1980s under apartheid to 57 per cent now. uplift the impoverished masses. The ANC’s critics exploit the This is similar to the deficits run by many highly developed economies. contradiction between the top levels of business and finance, where prosperity is being redistributed (often to the personal benefit of the Manuel’s labour ANC nomenklatura, in the name of black empowerment) and the slow Manuel’s EPWP work plan releases 15 billion rand (US$ 2.3 bn.) over progress on wider poverty and unemployment. five years, to create at least 1 mn. new jobs in building new provincial About 2 mn. jobs were created between 1998 and 2002. Skilled and municipal infrastructure. The programme’s four aims are: workers find employment in expanding areas such as tourism, ● more labour intensity in government-funded projects; information technology and manufacturing. Unskilled and uneducated ● more jobs in public environmental programmes; would-be workers are pushed into the low-paid informal sector, or ● opportunities in health, social welfare, etc.; half-jobs, while (according to the government’s review) the workforce ● developing small businesses and cooperatives. rose by 3.5 mn. people in 1991-2001, to a total of 16.4 mn. Just over Money has also been allocated for infrastructure projects, including 7 mn. of those have formal jobs. R1 bn. for upgrading Durban port and R3.2 bn. for Coega port, near Migration adds yet more job-seekers. There could be as many as 2 Port Elizabeth. mn. illegal Zimbabwean migrants, and plenty of others, seeking work ‘Better delivery’ is the new watchword, with heavy pressure on the in South Africa. Some economists reckon there are as many as half a local and provincial governments, which spend most of the money. A million openings for skilled workers and far too few South Africans drive to make the infrastructure work more effectively was launched

2 5 March 2004 Africa Confidential Vol 45 No 5 Self-examination Authored by the government’s Communications Director, Joel Netshitenze, 6 mn. people; the official ‘ten-year review’ of the African National Congress tenure claims Health: 495 new clinics built and 2,300 upgraded; great strides in providing housing, water and electricity but has much less to Education: adult literacy up from 83 to 89 per cent and for young people, say about progress in cutting unemployment or tackling HIV/AIDS. Less to 96 per cent; secondary school enrollment reaches 85 per cent; those visible and unsung by the review is the improvement in South Africa’s completing Grade 12, from 16 to 20 per cent; matriculation pass rate up from international standing in financial markets and economic management 54 to 69 per cent; generally, which has surprised the ANC’s detractors and supporters alike. Social Services: beneficiaries of grants from 2.6 mn. to 5.1 mn.; Under the National Party government prior to the unbanning of the ANC Land: 1.8 mn. ha. transferred to 140,000 households. in 1990, black South Africans’ living standards rated equally with those of The downside 1994-2004 Congo-Brazzaville, according to World Bank and United Nations Water: 5 mn. people still lack safe water; water bills are unaffordable for Development Programme statistics. Since then, there has been a steady many; improvement in the living standards of black people, in terms of social Sanitation: 18 mn. live without any; provision and cash income. This is a considerable achievement, given the Electricity: only half of households use electricity, the others relying on complexity of the political transition. Threatening all this, however, is the paraffin, coal or wood; HIV/AIDS pandemic which, in addition to the direct human suffering, Housing: demand is far ahead of supply; ‘government houses’ are often undermines gains in health and education in particular and slows the shoddily built; many have been taken over by syndicates which rent them; economy in general. Education: higher matriculation rates still leave many students poorly Achievements 1994 to 2004 prepared for tertiary education; Water: 9 million more people gained access; Employment: the workforce grew to 16.4 million (in 1991-2001), an Sanitation: households with access rose from 49 to 63 per cent; increase of approximately 3.4 million; about 2 million jobs were created in Electricity: 3.8 mn. new grid connections, increasing the number of 1998-2002 but this was outpaced by new job seekers, both South Africans households from 32 to 70 per cent; and migrants from the region; just over 7 million South Africans have formal Housing: 1.4 mn. new houses built of 2 mn. approved, providing homes for sector jobs. with the recent appointment of a former Director General of Finance, earning 20 per cent of the population were better off than the lowest Maria Ramos, to head the mega-parastatal Transnet, which coordinates earners by a factor of twelve, according to a household survey by the and owns most of the road and rail infrastructure. Bureau of Market Research of the University of South Africa in The Chairperson of the Public Service Commission, Stan Sangweni, Pretoria. The SA Reconciliation Barometer, a research project by the says that the public service is ‘fatigued and stressed’ by the pressure Institute for Justice and Reconciliation in Cape Town, confirmed last to improve performance, the awkward relations between the different year that economic inequality remains the country’s most divisive issue. tiers of government, the impact of HIV/AIDS and corruption. The A majority among all races felt that the widest division was between Commission wants to engage more directly with the people. poor and middle income or wealthy South Africa (30 per cent); the Provincial and Local Government Minister Sydney Mufamadi has second greatest perceived division was between political parties, notably outlined a raft of rural development and urban renewal programmes. the ANC and Inkatha Freedom Party (22 per cent). The racial divides The Public Works Minister, Stella Sigcau, has in the past five years came third, with 20 per cent. Coloureds and Indians perceived a class invested more than R1.7 bn. to create 2,993 rural infrastructure divide more strongly than whites and blacks. projects and an official 123,739 jobs in impoverished rural areas in six The same survey found that the fourth most troubling division was provinces. She speaks of ‘community gardens, multi-purpose between those living with HIV/AIDS (and other serious diseases) and community halls, rural access roads, bridges, taxi-ranks, market stalls, everybody else. The government’s review shows that its response to sports fields, crèches, additional classrooms, poultry houses, theme HIV infection and AIDS has grown rapidly, with expenditure rising parks and many more’. Social Development Minister Zola Skweyiya from R30 mn. in 1994 to R342 mn. in 2001/2002. It is set to increase claims that the government has made ‘unprecedented strides’ in social tenfold to R3.6 bn. in 2005/06, bringing the total AIDS budget to R12.5 security for the most vulnerable people – the elderly, the disabled and bn. over the next three years. Even that is too little for the sufferers. the very young. Between April 2000 and November 2003, the number The United Nations AIDS department, UNAIDS (whose figures are of those getting grants rose from 3.2 mn. to 7.5 mn., for an annual much disputed by statisticians), reckons that 5.3 mn. South Africans expenditure of R34 bn. live with HIV. Between 10 and 14 per cent of children under 15 are orphaned. The seropositivity rate increased from 22.4 per cent in 1999 Less fuss on land to 26.5 per cent in 2002, which the government interprets as stabilisation There has been less fuss than expected about land redistribution. The since 1999. HIV/AIDS activists continue to campaign against Health latest figures from the Deputy Land Affairs and Agriculture Minister, Minister Manto Tshabalala-Msimang’s blocking of the state-run anti- Dirk du Toit indicate that things have moved more slowly than the retroviral treatment programme they demand. They took as a grotesque government’s ten-year review had claimed; 115,504 households have insult her advice that patients eat more garlic, olive oil and beetroot. so far benefited from land reform and 810,292 hectares have been Nevertheless, Mbeki and Tshabalala-Msimang have grudgingly transferred. The ANC’s allies in the New National Party, backed by conceded that South Africa must catch up with pioneers of mass many large farmers, seem relaxed about the issue, having persuaded treatment such as Brazil and India, both of which are far less severely the government to make land transfers subject to challenge in the afflicted but have close diplomatic ties with Pretoria. At present, only courts at every level. about 1 per cent of HIV-positive South Africans get the treatment they Black household spending is rising faster than that of whites but the need. An adequate programme for all of them would be the world’s gap between rich and poor seems just as wide. In 2003, the highest- largest and most expensive. 3 5 March 2004 Africa Confidential Vol 45 No 5

Holdings team, Sexwale has carved out Concession 39, a massive SOUTH AFRICA/CONGO-KINSHASA prospecting area said to be rich in gold; Sisulu’s Afrimineral Holdings is the junior partner. Sexwale had people at Kilomoto days after the memorandum was signed. The concession will take years of work and millions of dollars of investment before it can turn a profit. The Peace dividend prospecting licence for the more developed neighbouring Concession President Mbeki’s diplomatic forays into 40 has been snapped up by Ghana’s Ashanti Goldfields, which Congo have a sound commercial base recently merged with South Africa’s AngloGold. In Katanga, Ruashi was once highly productive but needs investment South Africa’s dreams of harnessing Congo-Kinshasa’s massive hydro- of more than $10 mn. to restart operations. The initial plan is to electric resources to power most of Southern Africa are moving process the millions of tonnes of ore left by Union Minière before towards reality. The first aim for Eskom, SA’s state-owned power Congolese independence. Mvelaphanda intends to import a utility, is to build Inga III, a 3,500-megawatt project to transmit power concentrator from North America and start production within two along the ‘Western Corridor’. This brings in the national energy years. So far, though, the company has a memorandum, not a deal – companies of Angola, Botswana and Namibia, as well as Congo with much negotiating to do. itself. A first memorandum of understanding was signed in 2003. A Road and rail communications were poor, even before the war’s new, apparently final, agreement, backed by an inter-governmental devastation. Implementation of Congo’s new World Bank-approved memo, is supposed to be signed this year. mining code is held back by the over-stretched bureaucracy and by Beyond Inga III beckons Grand Inga, which Eskom says could political interference (AC Vol 45 No 1). produce 40,000 MW, enough for every city, mine and factory in Mbeki wants South African companies in Congo to be a showcase Southern Africa – plus extra power for export to Egypt, which has for black empowerment (AC Vol 45 No 3), whose rising star is ARM’s long had eyes for what could be the world’s cheapest electricity. Motsepe. Yet on the Kinshasa trip, he did little more than make Everything depends on political stability, with a definite end to the last preliminary investigations. South African companies in engineering, six years of conflict, and the establishment of a representative mining support services and construction – such as Grinaker and government for Congo-K. This project has also waited many years for Minproc – say Congolese officials do business with them because political stability further north: crossing Central Africa, Chad or Pretoria’s big role in the political transition gives them the edge over Sudan is not yet feasible. their main competitors, who are from Australia. That helps explain South African President Thabo Mbeki’s long involvement in the Congolese peace negotiations. Congolese officials Rewards for risk takers are due in SA this month to work on deals floated during Mbeki’s The risk that fighting might begin again imposes huge uncertainties on ground-breaking visit to Kinshasa in January. He led a delegation finance, even for World Bank-backed reconstruction projects. South which included political chieftains, such as Foreign Affairs Minister Africa’s Kumba Resources wants to develop the Kamoto copper and Nkosazana Dlamini-Zuma, Trade and Industry Minister Alec Erwin cobalt project and the Kipushi zinc mine, with Toronto-listed American and Deputy Defence Minister Noziswe Madlala-Routledge. Mineral Fields (AMF). Kumba is to resume negotiations with Gécamines in March but without hopes of an early resolution. Glamorous entourage This frustrates AMF, whose Chief Executive (and Congo-enthusiast), The politics-business nexus was represented by Gauteng’s ex-Premier, Tim Read, is eager to press ahead at Kipushi and with AMF’s other Tokyo Sexwale, Chairman of Mvelaphanda Resources and a stalwart big Congolese asset, Kolwezi. There, AMF needs up to $300 mn. for of the governing African National Congress; Zwelakhe Sisulu of development, having battled with South Africa’s giant Anglo American Afrimineral Holdings (and son of the late ANC elder statesman since the ousting of the late President Mobutu Sese Seko in 1997. Walter Sisulu); and African Rainbow Minerals Chairperson Patrice After two years in Congo and $250 mn. of investment, Vodacom has Motsepe. over 600,000 subscribers in 63 towns. It plans to invest $250 mn. more Big companies present were the mobile telephone giant Vodacom in the next two years, aiming for a million subscribers in 100 towns, (currently SA’s largest investor in Congo), Eskom and – curiously and hoping to outpace its nearest rival, Canada’s Celtel, which also unmentioned – the state arms manufacturer, Denel. Mbeki’s team claims around 600,000 subscribers in just 30 towns. included Brenda Fassie, a celebrated singer whose lively performance Vodacom says it will break even this year and make a profit in 2005 at Kinshasa’s Grand Hotel included a kiss smack on the lips of but its problems are compounded by claims and counter-claims of President Joseph Kabila. bribery in the cut-throat rush for subscribers. Vodacom’s Vice- Mbeki told parliament in Kinshasa that the memory of the murdered Managing Director, Gilbert Nkuli Yengeni, stridently denies Congolese nationalist leader Patrice Lumumba should be honoured allegations of wrongdoing. by bringing prosperity to his country. He and Kabila established a Across Congo’s economy, South African companies are moving in bilateral commission and signed preliminary agreements for projects while bigger European and North American companies hesitate, from defence to mining and telecommunications. fearing that the fragile peace could break down again. Mbeki has The main new business was done by Sexwale, who demonstrated astutely used his political leverage to win space for his country’s the connection between business and politics by signing MOUs, in the companies. For the power-sharing interim government in Kinshasa, presence of the two Presidents, for the Kilomoto gold project in north- South Africa offers an alternative to the mega-companies of the eastern Congo and the Ruashi copper and cobalt project in the southern industrial north or the smaller regional entrepreneurs. Katanga Province (ex-Shaba). Yet South Africa’s advance remains tentative. The hoped-for The Kilomoto mine, opened in 1905, was by the 1940s producing mining boom is still a vision, with little new money going in so far. If eight tonnes of gold a year, worth US$117 million at today’s price. the peace holds and a new government stabilises the economy, Congo Guided by Bernard van Rooyen, a mining veteran on the Mvelaphanda may begin to develop its gargantuan resources, under African auspices.

4 5 March 2004 Africa Confidential Vol 45 No 5

80 per cent stake in Otterbea International, a trading and logistics AFRICA/DIAMONDS company, mainly in mining. It is now 100 per cent owned by DiamondWorks. An Otterbea subsidiary, Trans Sahara Trading, specialises in oil trading – and has been at the centre of controversy in Zambia, where it had an exclusive contract to supply 450,000 tonnes Rough diamonds of crude oil, linked to a $100 mn. revolving credit facility from South A company with a controversial past blazes a Africa’s ABSA bank. new trail across the continent Trouble in Lusaka The South African heading the controversial DiamondWorks There were problems with delivery and the contract was cancelled company, Antonio Carlos Teixeira, better known as ‘Tony’, is a man amid recriminations and allegations; the DiamondWorks contract was in a hurry. He is expanding DiamondWorks’ mining operations and also cited as part of the problem when Zambian President Levy moving into oil trading and exploration, and even into banking (AC Mwanawasa fired his Vice-President, Enock P. Kavindele, who had Vol 45 No 3). Apart from established projects in Angola, Sierra sanctioned the deal in 2002. The agreement was tied up with debts Leone and South Africa, Teixeira has begun operating in Gabon, owed by the Zambian National Oil Company to the Zambian National Kenya, Malawi, Nigeria and São Tomé e Príncipe. There is concern Commercial Bank and Standard Chartered Bank of Zambia. DiamondWorks about the substance behind this rapid expansion. has denied making corrupt payments in relation to the contract. Deals with Nigeria’s Yinka Folawiyo to establish an oil bunkering DiamondWorks also had a 50 per cent stake in Petroplus Africa with facility in Lagos, with Gabon for oil exploration and with São Tomé Netherlands-based Petroplus International, a crude oil trading for oil trading have all been concluded in the last month. There are company. Petroplus won a contract last year to build a 400-kilometre unhappy associations with the DiamondWorks name (AC Vol 44 No pipeline from Nacala in Mozambique to Liwonde in Malawi and a 15); oil operations, at least, may be grouped under Energem, the 70,000-tonne storage facility to supply fuel. DiamondWorks has Teixeira company due to start up in São Tomé. Teixeira has brought already delivered small quantities of refined fuel to Malawi and crude in Sheikh Hasher Maktoum Juma al Maktoum of the ruling family to Kenya. Teixeira has befriended Malawian President Bakili Muluzi of Dubai, United Arab Emirates, and says a number of institutional who has, we hear, asked him to help to set up a bank in Malawi, with investors are being lined up to support further rapid expansion. backing from ABSA, again. DiamondWorks’shares, traded on the Canadian stock market, One of Teixeira’s biggest political coups was his purchase for $2 doubled in value in the first two months of the year. Such growth is mn. of a 51 per cent controlling stake in Spectre International, which the more remarkable given the company’s earlier difficulties. In was set up and part-owned by members of the family of Raila Odinga, January 2001, Teixeira was accused by Peter Hain, Britain’s then Kenya’s Minister of Public Works and perhaps one day prime minister, Africa minister, speaking under parliamentary privilege, of sanctions- if constitutional reforms go through. Teixeira has nurtured a close busting in Angola – at the same time as Teixeira was completing his associate with Odinga and his sister, lending a helicopter for political take-over of DiamondWorks through the reverse listing of shares in campaigning. Spectre’s main asset is a plant in Kisumu in western his family’s Guernsey-based trust, Lyndhurst Limited. Teixeira denied Kenya that produces ethanol from molasses. Odinga worked closely the charge, challenging Hain to repeat the allegation outside parliament. with Nigeria’s President Olusegun Obasanjo on his Leadership Teixeira’s name is also on a list of illegal diamond traders purportedly Forum project and the two men have stayed close, something that circulated by the South African Secret Service. That and some briefings might help Teixeira’s Nigerian ambitions. by Pretoria’s diplomats was enough to end Teixeira’s operations in Last June, DiamondWorks bought 51 per cent in the Canadian Gulf Central African Republic under President Ange-Félix Patassé (since of Guinea Petroleum Corporation, which in February picked up a ousted), according to Teixeira’s commercial rivals. small exploration block in Gabon. Such moves have boosted DiamondWorks was established in 1996 as a security-linked mining DiamondWorks’ share price but leaves the company exposed to concern. One of its leading shareholders was Tony Buckingham, awkward questions about the real value of this hectic activity. For who helped bring the South African mercenary firm Executive example, presentation of the memorandum of understanding between Outcomes to Angola and Sierra Leone. DiamondWorks’ concession DiamondWorks’ subsidiary Energem and the government of São in Sierra Leone was compromised by a return to civil war in 1997. Tomé reported a far-reaching deal between the two sides. In reality, all Through its subsidiary, Branch Energy, DiamondWorks has restarted the archipelago had offered was a face-saving formula of little its kimberlite project at Koidu in which its has a 50 per cent stake; commercial substance. DiamondWorks caused uproar in São Tomé Israeli diamond magnate Benjamin ‘Benny’ Steinmetz has the other when it claimed in January to have reached an MOU with the 50 per cent. A war of words is raging between Steinmetz and Teixeira. government to trade oil allocations provided by neighbouring states. DiamondWorks’ operations in Angola crashed in 1998 when rebels Teixeira claimed that DiamondWorks would be lifting oil from of Jonas Savimbi’s União Nacional para a Independência Total de contracts secured by São Tomé with other African states by as early as Angola attacked the Yetwene alluvial mine in the north-east of the late March. He insisted the MOU had ‘gone through every single country, killing several DiamondWorks’ employees. Teixeira claims cabinet minister, the prime minister, and the president.’ Prime Minister DiamondWorks lost US$20-30 million in Angola; dealing in Maria das Neves says that she was unaware of the deal, as do several DiamondWorks’ shares in Toronto was suspended until April 2001 other cabinet ministers. The Natural Resources and Environment after Teixeira had resuscitated the company. Although DiamondWorks’ Minister, Tomé Vera Cruz, says he signed the agreement under operations in Angola are on hold, the company still claims rights to the pressure from the President, Fradique de Menezes, and his oil Yetwene and Luo concessions. Luo is the subject of a running battle advisor, Patrice Trovoada, son of former President Miguel Trovoada, between Teixeira and Russia’s Alrosa and Portugal’s Escom. and the official who first bought DiamondWorks to São Tomé. Vera Teixeira and DiamondWorks operate through a network of Cruz has refused to resign, leaving the Premier to contemplate her own subsidiaries and joint ventures: in July 2002, the company bought an position and that of the government.

5 5 March 2004 Africa Confidential Vol 45 No 5

his car. Dikibo’s successor as the PDP’s National Vice-Chairman for NIGERIA the South-South Zone, Chief Efe Akpobi, is regarded as Anenih’s protégé. The Zone’s votes are regarded as crucial in presidential elections. As leader of the ruling PDP there, Anenih will play as big a role in the next election as in the last two. He is thought to be on poor Anenih’s irrestistible rise terms with Vice-President Atiku Abubakar (AC Vol 45 No 2). A mysterious murder affects the ruling PDP Before the 2003 elections, he paid two calls on Babangida in Minna, and probably the next poll presumably soliciting Babangida’s support for Obasanjo. If his wish is only to serve Obasanjo’s personal interests and Obasanjo is ineligible It is hotly disputed whether Aminasoari Kalu Dikibo, a chieftain of for another term, why did Anenih agree to become Chairman of the the governing People’s Democratic Party in the oil-rich Niger Delta, party’s Board of Trustees? His operations will bear watching for clues died in a political assassination or an attack by armed robbers. The as to how the PDP intends to hold on to power when Obasanjo retires. killing was followed by a shake-up within the PDP, after which political veteran Anthony Anenih emerged as Chairman of the party’s Board of Trustees, pegging level with National Chairman GAMBIA Audu Ogbeh for real power in the party. Ambitious politicians anticipate big changes there. Anenih is one of Nigeria’s most flexible politicians. He is close to Babagate or floodgate President Olusegun Obasanjo and was a confidant of his military predecessor, General Sani Abacha, for whom he lobbied against Jammeh is busy boasting of oil riches and sanctions at the Commonwealth Summit in Edinburgh, Scotland in arresting old friends for corruption 1997. He was appointed Minister of Works by Obasanjo; his critics Gambians in search of hope after a decade of impoverishment and said he was inefficient and broke the government’s accountability repression under President Yahya Jammeh’s regime might have had rules. When Obasanjo reshuffled the cabinet after his re-election last their spirits momentarily lifted after he announced the discovery of April, Anenih told the press that he would not accept reappointment ‘large amounts of oil’ last month. On further investigation, the news but would serve Obasanjo in a personal capacity. is more ambiguous. The large Amerada Hess Corporation of the During Obasanjo’s military government (1976-1979), when Alhaji United States looked at Gambia’s offshore prospects but relinquished M.D. Yusufu was Inspector General of Police and Ministerof Internal any interest. The small Houston-based Vanco Energy Company, too, Affairs, Anenih retired from the police under duress. His comeback was not enthused enough to investigate further the prospects of a was helped by his relationship with the late Shehu Yar’Adua, as a concession straddling the border with Senegal. business partner in the Yakon Group of Companies, and later as a A further problem is that Jammeh added that oil operations would political aide during the transition period of Gen. Ibrahim Babangida be handled by the president’s office, not the Trade and Industry between 1986 and 1993. Anenih chaired the National Party of Ministry. It was the presidency that handled ‘a gift’ of 20,000 barrels Nigeria’s branch in his home state of Bendel (later Edo) and is credited of oil a day from Nigeria’s then military leader, General Sani Abacha, with engineering the return of Samuel Ogbemudia, a military Governor between August 1996 and June 1998. Jammeh had been one of under Gen. Yakubu Gowon, as NPN civilian Governor in 1983. Abacha’s staunchest supporters (he was the only Commonwealth leader to support Abacha’s right to hang writer and human rights From Babangida’s pantheon to Obasanjo’s activist Ken Saro-Wiwa). Following a row between rival oil traders In that year, the army overthrew the civilian government and Anenih – Chantrills and Marc Rich – in London’s High Court, it emerged that soon became influential in the Babangida pantheon. When the only a small group of businessmen linked to Jammeh had benefited military government set up two political parties, he became State from Abacha’s ‘gift’. Profits from the deal amounted to over US$5 Chairman, and later National Chairman, of the Social Democratic million a year: most was paid into account number J36650-70 at Party on behalf of the Yar’Adua machine. He was temporarily United Overseas Bank, which oppositionists link to Jammeh himself. frustrated when M.K.O. Abiola took over the party but (backed by Along with a Gambian-Moroccan businessman, Philip Bensouda, Yar’Adua) became a key figure in Abiola’s campaign and was Jammeh’s former lieutenant, Baba Jobe, played a key role in setting caretaker Chairman of the SDP when another Yar’Adua acolyte, up the Abacha oil deal and secret bank accounts in Switzerland. That Babagana Kingibe, became Abiola’s running mate. is why few Gambians believed Jammeh’s protestations that he hadn’t Once it became clear that Moshood Abiola was winning, Babangida benefitted personally from the deal and why they are sceptical about annulled the presidential poll on 12 June. Anenih started talking to the Jammeh’s anti-corruption campaign – known as ‘Babagate’ – which military and Abiola-loyalists accused him of selling out. Later, he began with the arrest of Baba Jobe in November. proved equally willing to deal with Babangida’s successor, Abacha. At the time, Jobe was head of the youth wing of the ruling Alliance Anenih is the PDP’s master election strategist. He used those for Patriotic Reorientation and Construction (APRC), majority leader talents, developed in Edo State, in the April 2003 national elections, in the National Assembly and the country’s second most powerful man which were strongly criticised by the European Union, less so by the (AC Vol 44 No 19). He was also Managing Director of a company Commonwealth. Anenih clashed openly with fellow South-South called Youth Development Enterprises (YDE), of which Baba Kanteh politician Marshall Harry, whose murder a month before the elections was an associate manager. The two were charged with defrauding (AC Vol 44 No 5) was either an assassination or armed robbery. Customs and Excise and went on trial together in December. The Dikibo’s associates have pointed fingers at senior PDP politicians. prosecution says Jobe had links to companies belonging to Lang But Anenih had shown no animosity towards the dead man and Conteh, former Foreign Exchange Manager of the Central Bank. quickly visited the Dikibo family after the event. One newspaper Conteh’s considerable personal wealth, way beyond his meagre middle- claimed that he wept so profusely that he had to be helped back into ranking civil servant’s salary, aroused suspicion. 6 5 March 2004 Africa Confidential Vol 45 No 5

The trial of five Central Bank officials, who are the latest targets in 2002, which cut production of food (especially the staple, rice) and of the Babagate affair implicating senior officials in major fraud, started groundnuts, the export of which earned just half of the expected $14 on 1 March. Conteh, ex-Governor Clark Bajo, General Manager mn. Tourism was up on the previous year but didn’t match earlier Haddy Sallah, Director of Finance Abdoulie Capu Cham and Philip levels. Fuel prices rose along with international oil prices and the Akibogum, a senior executive, were charged with economic crimes decline of the exchange rate helped to push up inflation to 15 per cent. on 23 January. Conteh is in Jammeh’s inner circle and we hear that Western governments have been slowing some aid disbursements Western officials were already worried about his foreign currency and insisting on extra accountability. The International Monetary deals. Some of the charges concerned contracts with companies partly Fund renewed its credit support of $27 mn. last July, on condition that owned by his teenage daughter, Bintou, and by Lang Conteh himself. the government improve its financial management and reporting Jammeh’s kinsman and former Finance Minister, Famara Jatta, systems. In June, the World Bank had spoken of ‘a high level of emerged as Governor of the Central Bank after the latest crisis. fiduciary risk’, listing ‘poor resource allocation, non-compliance, Jammeh shot his way to power a decade ago, promising to fight limited execution, inadequate scrutiny, insufficient capacity, lack of corruption and tribalism. Information Minister Yankuba Touray enforcement, non-transparency, and poor parliamentary oversight’. was one of few other coup-makers to remain in power. In mid- The Bank and Fund were especially worried about the Central Bank. December, he was arrested on his return from a visit to Switzerland The IMF’s end-of-year statement spoke of information suggesting and dismissed from his Ministry. He has been accused of embezzling ‘that data and foreign international reserves provided to the fund may 4 mn. dalasi from a charity set up on Jammeh’s orders to promote a have been significantly overstated and there were associated ‘Roots Homecoming Festival’. Touray still pledges undying loyalty inaccuracies in the data on government expenditure, fiscal balances to the regime in the belief that before long, he will be rehabilitated. and credit flows in 2001’. Opposition parties accuse Jammeh of releasing an anti-corruption Only one captain smokescreen to cover his own misdeeds, pointing out that many of This leaves only two of the five members of the Armed Forces those charged were his close associates and alleging he was linked to Provisional Ruling Council set up after the 1994 coup still in positions Baba Jobe’s YDE. Political tensions have ratcheted up, with attacks of power – Jammeh himself and Edward Singhateh who, like on opposition politicians. In October, arson attacks were made on the Jammeh and Touray, is a retired army captain). Singhateh has had offices of the outspoken Independent newspaper and of Radio FM 1. varied fortunes over the last ten years; he and his brother Peter, scions In December, a leading lawyer, Ousmane Sillah, who has often of a distinguished Mandinka father and English mother, have been defended opposition leaders (and now Baba Jobe), was stabbed. Local accused of involvement of the massacre at Bakau Barracks. Jammeh and foreign human rights groups accuse the Jammeh regime of is said not to trust Edward but knows he cannot break with him and he orchestrating the attacks to intimidate defence lawyers. is thought to be back in the ascendancy as a main partisan of clamping The weak and divided opposition, fearing that Jammeh may get down on Baba Jobe. Edward Singhateh would be a key player if even tougher, has been speaking out more openly. The main critic has resentment about Jammeh’s purge starts to spin out of control. been Lamin Juwara, who broke away last year from Ousainou One of the two other original coup-makers, Captain Sana Sabally, Darboe (an unsuccessful presidential candidate in 2001) to form his was released from prison at the end of January having been gaoled in own party. In mid-January, Darboe, too, broke his silence to deplore January 1995 on charges of treason. His fellow conspirator, Capt. the erosion of civil liberties. Opposition in Gambia is a lonely and Sadibu Hydara, died in detention in the same year, purportedly of unrewarding struggle. Even the revived People’s Progressive Party natural causes. The case of Sabally, a Mandinka, points to wider splits (the former ruling party) could not hold its party congress for lack of in the army between the majority Mandinka and Jammeh’s minority funds. Deposed President Jawara returns to his house on Banjul’s Jola, who are pre-eminent in key command positions. Atlantic Road for brief periods but remains wary of Jammeh. Jobe has not been granted bail. Some sceptics suggest that his case The eccentric and autocratic Jammeh portrays not sparing his is a set-up for Jammeh’s anti-corruption campaign, ‘Operation No friends in his housecleaning campaign as a sign of strength. It could Compromise’, and that Jobe will be rehabilitated when it suits Jammeh. also spell trouble for him, as his other targets and erstwhile allies grow Until last August, Jammeh was calling Western diplomats, asking for anxious about being snared in the anti-corruption campaign. It is from help to get Baba Jobe off the United Nations’ sanctions list. So the rift the partisans of the July 1994 coup, not from the gentlemanly opposition, between Jobe and Jammeh seems to have developed fairly recently. that the President has most to fear. Jammeh is extremely sensitive to charges of corruption. After Africa Confidential revealed that he had been the beneficiary of oil Visit our website at: www.africa-confidential.com Published fortnightly (25 issues per year) by Africa Confidential, at contracts awarded by Nigeria’s Abacha (AC Vol 41 No 2), Jammeh 73 Farringdon Road, London EC1M 3JQ, England. published repeated denials and launched a witch-hunt to discover our Tel: +44 20-7831 3511. Fax: +44 20-7831 6778. sources. Amid massive public interest, the court is packed with Copyright reserved. Editor: Patrick Smith. Deputy Editors: Gillian Lusk spectators. The prosecution has called evidence from a former and Richard Synge. Administration: Clare Tauben and Juliet Amissah. Annual subscriptions including postage, cheques payable to Africa minister in President Dawda Jawara’s pre-1994 government, Buba Confidential in advance: Baldeh, who was a member of the YDE board; he disclosed that YDE Institutions: Africa £359 – UK/Europe £422 – USA $1062 – ROW £550 owed 65 mn. dalasi ($2.2 mn.) to the Gambian Ports Authority for a Corporates: Africa £464 – UK/Europe £517 – USA $1197 – ROW £645 rice import deal. The weakness of the economy has increased public Students (with proof): Africa/UK/Europe/ROW £96 or USA $138 African Studies Assoc. members: UK/Europe £70 – Americas $102 – ROW £70 anger at reports of misuse or theft of public funds. All prices may be paid in equivalent convertible currency. We accept December’s budget speech by new Finance Minister Mousa Bala- American Express, Mastercard and Visa credit cards. Gaye looked forward to growth in all sectors next year but spoke of ‘a Subscription enquiries to: Africa Confidential, PO Box 1354, 9600 series of economic shocks, both internal and external, that have Garsington Road, Oxford OX4 2XG England. Tel: 44 (0)1865 778315 and Fax: 44 (0)1865 471775 threatened to destabilise the economy and indeed threaten to disrupt Printed in England by Duncan Print and Packaging Ltd, Herts, UK. the social fabric of our society’. He was talking about the drought of ISSN 0044-6483

7 5 March 2004 Africa Confidential Vol 45 No 5

band. The Congolese, having allegedly paid guerrillas under arms, is now by far the biggest. Pointers Wemba a US$3,500 fee, typically ‘disappeared’ Highly-placed sources in Algiers said Le Para during his European tours, never to be seen by had used some of the 4-5 million euros which immigration officials again. Wemba (54) was Germany paid for the release of hostages his NIGERIA/USA arrested on such charges in France last year and group had captured in 2003 to re-arm, paying detained for three months. substantial amounts, probably for equipment Blowback Now the King of Rumba Rock’s troubles are looted from barracks in Mali and Mauritania. rebounding on other Congolese musicians, too. Algiers worries about Islamist activity in Arab Investigations in France, Nigeria and the United Jeany Ibela-Ibel, President of the Congolese Maghreb Union ally Mauritania; this includes States into claims that the US company Halliburton artists’ union, complains that European soldiers who in June mounted a failed coup against was party to a US$180 million slush fund to bribe immigration authorities are victimising Congolese President Maaouya Ould Sid’Ahmed Taya. Nigerian officials are growing in political musicians and alleges that it is now almost The US presence in Mali will help Algeria to significance. Two familiar questions are asked of impossible for them to play in Brussels or Paris. squeeze Le Para. The other GSPC faction, US Vice-President Dick Cheney, Halliburton’s Indeed, J.B. Mpiana and his BCBG band, who operating in the north-east, is led by Nabil Chairman and Chief Executive in 1995-2000: along with his ex-Wenge Musica co-star and now Sahraoui who, after a power struggle last year, what did he know and when did he know it? bitter rival, Werrason, are the musical equivalent took over from GSPC founder Hassan Hattab as Halliburton has already accepted, in a related of Arsenal and Manchester United in Kinshasa, ‘national emir’. Press reports suggest Hattab is case, that two staff of its Nigerian subsidiary have been unable since last November to return to also still active but sources told AC he was being bribed local revenue officials to evade corporate Paris. They need to finish off their long-awaited held by the new emir ‘in a form of house arrest’. tax of some $5 mn. Documents circulating in new album, ‘Anti-Terror’, but Mpiana can’t secure Nigeria suggest that Halliburton may have evaded visas for the band. WESTERN SAHARA far more tax than previously estimated. He has not released an album since ‘Internet’ in More embarrassing are allegations about the 2001 and, under pressure from his followers to $180 mn. slush fund to secure contracts on bring out new music soon, has instead headed Whose land? Nigeria’s $3 billion Liquefied Natural Gas plant. south to Downtown Studios in central The row over who owns the Western Sahara’s France’s Technip’s George Krammer told a Paris Johannesburg, South Africa. He says the studio mineral rights is reopening. British-based Wessex court in 2003 that a consortium of Technip, facilities are good but complains that local sound Exploration has applied to Morocco’s Office Halliburton’s Kellogg, Brown & Root, Italy’s engineers lack the right finesse. National des Hydrocarbures et des Mines to Snamprogetti and Japan’s JGC had established explore for oil and gas onshore. front companies in Madeira (LNG Services) and ALGERIA Total (France) and Kerr-McGee (United Gibraltar (Tristar) to fund illegal payments to States) courted controversy in 2001 by signing Nigerian officials on the LNG project. one-year reconnaissance permits with Rabat for Last October, France ordered magistrate Squeezing Le Para two offshore blocks. And after doing an initial 2D Reynaud van Ruymbeke to investigate: this has The Algerian security services’ relaxed approach seismic survey amid a storm of protest, Norwegian produced many documents linked to front to the growing United States’ military presence contractor TGS-Nopec said it would stay clear in companies from Monaco and Switzerland. in the Sahel reflects their concern at the number of future. Total and Kerr-McGee have renewed their Sources close to the inquiry say he may sub poena arms in circulation, especially in traditional permits twice but keep a low profile. testimony from British-based lawyer Jeffrey partners Mali and Mauritania. They also spy a Wessex MD Frederik Dekker says he’ll start Tesler, who works regularly for Halliburton and new opportunity to harness US high-technology by examining existing data rather than by putting was close to officials under the late General Sani equipment to eliminate the fastest growing element a team on the ground. The United Nations Legal Abacha, in power when the LNG project began. of the main Islamist underground group, the Affairs Department ruled in 2002 that the permits The four consortium companies had a 25 per cent Groupe Salafiste pour la Prédication et le Combat. weren’t illegal but more exploration could be. stake but oil industry sources claim Halliburton Operations by the GSPC, which the USA and By taking over Fusion Oil and Gas last year, the took the lead on major procurement decisions and others link to Al Qaida, have spread into Algeria’s UK’s Sterling Energy has inherited a deal signed had insisted on using Tesler as legal advisor. deep south Tassili Region and to Mali, under with Polisario in May 2002 to assess the territory’s The French probe provoked the US Justice faction leader Abdel Razak ‘le Para’. These potential, again by re-examining old data. Sterling Department and Securities & Exchange trends were apparent in the late January strike will meet Polisario’s new London (formerly Commission in January to launch their own against a column transporting arms for the GSPC Netherlands) representative, Ubbi Bashir, in a investigations: Halliburton will be requested to (AC Vol 45 No 4). They are expected to feature few weeks’ time. Sterling says it plans to wait and submit testimony and documents. Soon after, again in operations in the coming months, notably see how the Western Sahara’s status is resolved, Nigeria announced its own inquiry into the claimed in the Malian border region where Le Para’s especially as it suspects it will remain in Moroccan diversion of LNG project payments. powerful ally, Moktar ben Moktar, is active. hands. Morocco is not so sure. Algeria needs US satellite support to track Proposals last year from UN envoy James T. CONGO-KINSHASA movements in the vast Saharan region. Despite its Baker III provide for a referendum in four to five efforts to buy equipment, formal sales of many years but an elected Western Sahara Authority forms of arms and materiel remain blocked by would run local administration in the interim. Papa Wemba’s big band Western governments’ concerns over the military’s Morocco fears this would create a Polisario power- Congolese music star Papa Wemba was extradited participation in human rights abuses. The Algerian base inside the territory (AC Vol 44 No 18). The by France to Belgium in late February to face military particularly want night vision and other new Baker proposals were accepted by Polisario charges of illegally obtaining visas for Congolese tracking equipment to squeeze the remaining in July and approved by the UN Security Council immigrants by claiming they were members of his groups, of which the GSPC, with about 450 in August but Morocco has yet to agree.