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African Oil Find Not Likely to Help Poor

By BARRY HATTON Associated Press Writer
© 2006 The Associated Press

SANTO ANTONIO, Sao Tome and Principe — For more than 30 years Eugenio Piter has scraped a livelihood fishing from his dugout canoe in West Africa ' s Gulf of Guinea .

Now, his tiny island nation is about to unlock the wealth from an estimated 11 billion barrels of oil from the seabed beneath those same Atlantic waters. The government says the oil is the answer to this country ' s grinding poverty. But people like 51-year-old Piter say the benefits o f t he anticipated oil windfall are as uncertain as his catch on any given day.

Too often, in too many places across Africa , oil has only fomented despotism and cronyism, and left the poor poorer. Already, even before a drop has been pumped here, oil has fueled political squabbling in this country, which now exports little more than cocoa and imports almost everything else.

Global Witness, a group that tracks corruption in resource-rich developing countries, welcomed safeguards Sao Tome officials pledge will help them avoid a repeat of oil ' s corrosive effects, but noted that some measures, especially a commitment to establishing independent oversight committees, have still not been enacted.

"Implementation is the thing," Sarah Wykes of Global Witness said.

Authorities hired legal experts from two U.S. universities to help craft legislation for the oil sector. Norway is advising on transparency.

Under the law, oil revenue goes automatically into a bank account at the U.S. Federal Reserve. Funds can be withdrawn only with the signature of four senior officials, including the president and prime minister.

But trying to police the oil sector is like trying to herd cats.

A report by the Attorney General ' s Office concluded that the selection process for awarding offshore fields last year was tainted by political manipulation, shady companies and murky payments.No charges were ever brought because Nigeria , which shares the oil fields under a 2001 agreement, refused to open its books.

"There will always be unscrupulous people," said Luis Prazeres, the executive director o f t he National Petroleum Agency, a government-appointed watchdog. "The world ' s a complicated place."

Sao Tome and Principe covers about 400 square miles and has only about 150,000 people. When offshore oil reserves were discovered eight years ago, the country was hailed as a potential "Brunei of Africa" or " Monaco o f t he Gulf of Guinea ."

The Gulf of Guinea produces about 4.5 million barrels of oil a day and supplies nearly 15 percent of U.S. crude imports. Analysts say that figure could climb to 25 percent within next 10 years with the help of countries like Sao Tome .

The crude is light and easy to refine, and the region lies conveniently across the Atlantic from the United States .

Senior U.S. military officials have spoken to Sao Tome about establishing a home port for the U.S. Navy in the islands.

Earlier this year the U.S. chose Sao Tome as the regional center for a maritime security program called Marine Domain Awareness, which monitors ship movements and identifies vessels. That includes the provision of modern radar equipment, telecommunications and computers. Such a system is helpful for protecting supertankers.

Sao Tome's elected officials portray the oil discoveries as an antidote to the entrenched poverty and flourish grand development plans once the oil starts flowing in a few years ' time.

But the people, stuck in miserable living conditions, have not fallen under oil ' s spell.

Ask just about anyone in the streets o f t he capital, called Sao Tome, whether they think they will feel any benefit from oil and they reply with raised eyebrows and a smirk that says, "Are you kidding me?"

Sao Tome and Principe has never known great wealth.

Portuguese settlers, who discovered the two volcanic islands on the equator in the 15th century, used slaves on their coffee and cocoa plantations for several centuries.

Those European rulers withdrew in 1974.

Arlecio Costa, a former soldier now involved in tourism, points through the window of his office in the capital to the street outside.

"The Portuguese built that," he says o f t he road whose edges have been frayed by tropical downpours that have also scoured deep potholes. "Sewage used to run beneath it. Now it runs over it," he said.

Sao Tome's annual gross domestic product is around $70 million. For years it has been propped up by foreign aid and has racked up some $340 million in foreign debt.

No one dies of hunger in Sao Tome . The warm ocean has plenty of fish, and the fertile tropical rain forest is full of exotic fruit. But few grow fat.

In the Riba Mato suburb o f t he capital, where wooden shacks on stilts are glimpsed through thickets of banana trees and the loudest noise is the chirruping of colorful birds, wiry children on the roadside wave at passing vehicles. When every few minutes a mango falls with a thud behind them they dash giggling into the undergrowth as if on an Easter egg hunt.

Not everyone is able to fetch what they need.

Leonarda Miguel, 73, lives in a quarter o f t he capital called Liberdade (Freedom), named after the country ' s 1975 independence. She, her daughter and granddaughter share a dingy, two-room house with no running water, no sanitation and sporadic electricity. There is no glass in the windows, and her front door is an ill fit.

"I go to sleep hungry and I wake up hungry," she says, mimicking sleep by clasping her hands next to her cheek.

"Oil money won't reach this far down. We ' ll still be hungry," she said.

http://www.chron.com/disp/story.mpl/ap/fn/4348485.html

Dr Sarah Wykes
Oil Campaign
Global Witness
PO Box 6042
London N19 5WP
Direct line: +44 (0)207 561 6362
www.globalwitness.org
www.publishwhatyoupay.org
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