Help us follow the dirty money, Guinea asks G8

Reuters News
|
Posted: Jun 15, 2013 10:02 AM
Help us follow the dirty money, Guinea asks G8

By Clara Ferreira-Marques

LONDON (Reuters) - Guinea, one of Africa's poorest nations despite abundant natural resources, has urged the G8 to back its battle with corruption by helping trace shell companies used to hide crooked deals and track dirty money flows.

The resulting increased prosperity, President Alpha Conde said, would help stem growing radicalism in a region already threatened by unrest in Mali that has placed Guinea and its neighbors at risk of becoming conduits for drugs and guns.

Guinea has long been one of Africa's "geological scandals": the West African country has rich reserves of iron ore, gold, bauxite and other minerals, but little has been tapped and half its 10 million people live in poverty.

Speaking ahead of an annual G8 meeting expected to put the resources industry and transparency high on the agenda, Conde said Guinea needed logistical support from U.S., British and other governments and law enforcement agencies.

"Mining companies are...British, American, Canadian, Australian, and London's City and New York are the centers of capitalism. If we want to fight for transparency, we need the support of the G8," Conde told Reuters in London, before a discussion on transparency including other African leaders and British Prime Minister David Cameron on Saturday.

"There is no corruption without corrupters."

He also said Guinea might have to postpone a long-awaited parliamentary election scheduled for June 30 after opposition parties refused to register candidates.

A former Sorbonne law professor, Conde came to power in 2010 after half a century in opposition, promising to end decades of corruption and mismanagement. He has been supported by a raft of high-profile international advisers, including philanthropist George Soros and former British Prime Minister Tony Blair.

"We have limited means.. we cannot follow shell companies in tax havens, so we need these big countries to help us find all the proof for payments and corruption," Conde said, adding Guinea's laws allowed it to annul corruptly obtained licenses.

"Also, sometimes, firms tell us they made 10 of profit. If they say 10 in Guinea and 100 in England, we can pursue that."

Shell companies have frequently been blamed as tools in corrupt resources deals across Africa. Transparency activists say they are widely used to hide the ultimate beneficiaries, whether government officials or profiteering intermediaries.

OPAQUE DEALS

As part of Conde's overhaul of the mining sector, Guinea is reviewing mining contracts, scrapping as many as 800 that had been lying fallow and scrutinizing those signed during what the government says was an era of opaque deals.

These include the license for the northern half of its giant Simandou iron ore deposit held by BSG Resources, the mining arm of Israeli billionaire Beny Steinmetz's business empire, and partner Vale.

The original concession, secured by BSGR just before the death of then-President Lansana Conte, has come under scrutiny. In April, FBI agents arrested a BSGR representative on charges of obstructing a criminal investigation, tampering with a witness and destroying records. BSGR has denied wrongdoing.

Conde declined to comment on the outcome of the review but welcomed the FBI's support.

"I believe in presuming innocence until guilt is proven," he said. "But it is very important that the FBI and the U.S. judicial system was able to obtain this evidence - we would never have been able to."

The Steinmetz case has generated much media interest and remains controversial for Guinea, whose critics say it suits the interests of the country's advisers. But Conde says the advice of international banks, law firms and others was indispensable.

"Negotiating without it would have been (like) heading straight for the slaughterhouse," he said.

Conde, a longtime advocate of African cooperation, called for greater regional collaboration on the infrastructure needed for tapping mineral resources, but also on security, describing as "embarrassing" France's intervention in the Malian crisis.

Among his major concerns, Conde said, was the flow of guns and drugs that once went through the Sahara but now transiting countries such as his own, blaming the Western military action in Libya in particular for spreading weapons across the region.

"It is not about asking for help, because this concerns the G8," he said. "It is in our common interest that the Sahara does not become another Afghanistan, as much for terrorism as for drug trafficking."

Conde said increased radicalism was a function of poverty and high youth unemployment, but acknowledged that he was also concerned by the rise of hardline Islamist preachers.

"All of our countries are under threat. Why? Because al Qaeda is not just Tuaregs and Arabs. They are Malians, Ivorians, Senegalese, Guineans."

(Additional reporting by Matthew Tostevin; Editing by Alistair Lyon)