Global Policy Forum

By Declan Walsh

As the threat of starvation sweeps across war-ravaged Angola, its secretive government is coming under pressure to explain how billions of dollars in oil revenues have gone "missing" in recent years.

A fresh humanitarian crisis has hit war-ravaged Angola since fighting with Unita rebels ended last April. Three million people are teetering on the edge of survival, many hungry, sick or homeless. Angola's president, Eduardo dos Santos, has appealed for international help, pleading that his government is broke. But a swelling chorus of diplomats, campaigners and angry Angolans are asking why President dos Santos can't pay his own way out of trouble. His government earns billions of dollars from a burgeoning oil exploration business that will soon rival Nigeria as Africa's largest.

And while only a tiny amount is spent on helping suffering Angolans, every year a large chunk of the profits -- between 20 and 35 per cent -- mysteriously disappears.

Last year, for example, the International Monetary Fund (IMF) estimated the oil revenues at more than $4.5 billion Cdn, of which nearly $2 billion simply vanished. The IMF terms these missing billions "unaccounted expenditure" but campaigners such as the U.K. advocacy group Global Witness call it "wholesale state robbery."

They say that Angola's vast oil profits are disappearing into the pockets of the "Futungo" -- a secret, powerful elite centred on President dos Santos -- on a scale similar to the excesses of the notorious kleptocrat Mobutu Sese Seko. Many diplomats in the capital, Luanda, agree.

Western oil companies such as BP, Shell and Chevron are also accused of complicity in the grand theft, for refusing to reveal their annual payments to the Angolan government.

"Billions of dollars have gone missing, money that should be used to buy food, medicine and reconstruct the country," said Patrick Nicholson of Cafod, a British aid agency involved in the "Publish What You Pay" campaign. "Oil companies could play an important part in bringing the government to book".

The campaigners, led by American financier and philanthropist George Soros, are hopeful that British Prime Minister Tony Blair, French President Jacques Chirac and other world leaders will endorse the initiative at the Earth Summit in Johannesburg next week.

The Angolan government, however, is implacably opposed to their plans. For example, when BP Amoco broke ranks last year and offered to publish its payments, the state oil company, Sonangol, threatened to shut down its operations.

The Angolan government has been tainted with corruption allegations for several years, but the end of the war -- which UNITA has officially declared over -- and the critical humanitarian situation have renewed the focus.

In a recent submission to the UN Security Council, a British official pointed out that the UN is struggling to raise about $300 million for Angola -- the equivalent of three weeks' oil profits for the government.

Just where the missing billions have gone is unclear, but the dilapidated streets of Luanda offer some clues. Fleets of the latest BMW, Mercedes and Jaguar cars splash along the sewage-laced roads, roaring past the armies of ragged, homeless people on the pavements. Many are driven by government employees or associates. This visible ostentation is probably just the tip of the iceberg.

Earlier this year Witness published the number of a $1 billion bank account in the British Virgin Island. The money was controlled, it says, by unnamed figures connected to the Futungo. The Futungo, a close-knit cabal of powerful military, business and political figures, is shrouded in mystery. Popularly it is thought to number 200 families; analysts refer to it as Angola's "parallel government."

However a glossy magazine called Tropical, sold on Luanda street corners, offers a glimpse into the lifestyles of this exclusive set. Magazine photo spreads show designer-clad Angolans enjoying themselves; the latest issue features parties in London, Lisbon and Luanda. There are also two pages on the 29th birthday celebrations of Isabel dos Santos, the president's daughter.

The glitzy extravagance contrasts starkly with the lives of most of Angola's 13 million people. They have slim hopes of getting a job, an education or even staying alive for very long: average life expectancy is 45, unemployment is 80 per cent and three out of 10 children do not even see their fifth birthday. Such glaring inequalities have also slowed donor responses to humanitarian needs. Only one-third of the UN appeal for $300 million has been met while some western countries, such as Britain, Norway and the Netherlands, refuse to channel aid through government agencies.

"There's obviously a question about whether we should pick up the tab for a government that clearly has the money," said one European diplomat.

In the eastern town of Luena, the medical charity Medecins Sans Frontieres has cut aid to the local hospital because supplies kept disappearing. These days it is a dirty place of broken windows and suffering patients.

The hospital director, however, is doing better. Dr Carlos Alberto dresses in smart suits, wears an Yves Saint-Laurent tie and drives a new Suzuki jeep. In his office there is a new laptop on the desk and a television stacked on the fridge. "The situation is very difficult," he said in his air-conditioned office, the only one in the building. "The support we receive from the government is not enough to cover our problems."

FAIR USE NOTICE: This page contains copyrighted material the use of which has not been specifically authorized by the copyright owner. Global Policy Forum distributes this material without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. We believe this constitutes a fair use of any such copyrighted material as provided for in 17 U.S.C § 107. If you wish to use copyrighted material from this site for purposes of your own that go beyond fair use, you must obtain permission from the copyright owner.