The challenges of exploiting natural resources in Africa

As oil strikes in Africa occur with increasing frequency, American and European oil giants are competing on a continent that they previously abandoned.

Following the September 11 attacks in the United States, the Bush administration decide to encourage American companies based in the Gulf to look towards Africa � America also decided to get tough with Gulf States that promoted terrorism.

However, most of the African States whose land is incredibly rich in natural resources are buckling under the weight of corruption, to which politicians become prey, especially at election time.

The American giant corporations behind this surge in power in Africa are finding themselves in difficult situations when competing with certain Chinese, European, and even African companies, whose notion of ethics � for all practical purposes � does not exist.

The American companies, under the watchful eye of the US SECURITIES AND EXCHANGE COMMISSION, now appear to be the big losers in a project where they were once the pioneers.

Senegal, a small country in West Africa, currently in the throes of an election period, seems to be a perfect illustration of a dramatic situation. European and Chinese companies who claim to have been sidelined by the current regime are lining up in support of the incumbent president’s serious challengers in the hope of benefiting from Senegalese oil and gas � Former Senegalese energy minister and possible presidential candidate Thierno Sall finds himself being courted by companies he worked with when he was the current president’s minister for energy.

A young prodigy from Senegal politics, Ousmane Sonko, former tax inspector, has already benefited from the financial assistance of a large European company aimed at securing him a successful election campaign in return for offers of attractive oil contracts.

Faced with situations such as these, must America, under the tutelage of the S.E.C., continue to be the last in line when it comes to African discoveries?

Source: Modern Ghana