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Equatorial Guinea |
ECONOMY
Equatorial Guinea is on its way to become Africa’s third biggest oil producer
In Equatorial Guinea, human rights issues cannot be ignored when considering the country’s economic expansion, especially in the Luba Bay area, situated some 52 kms from Malabo where a major port is being built. This new port will have a free zone status and a huge oil rig managed by Incat Petroleum Services (IPS). Confirmed sources indicate that oil production could reach more than 300,000 barrels a day by the year 2002, and this will turn Equatorial Guinea into a new «Eldorado» and Africa’s third largest oil producer, coming after Nigeria and Angola.
The Government of Equatorial Guinea wants at all costs to align itself with international standards vis à vis human rights, and to portray a good self-image by improving its judicial system while carrying through the country’s economic reforms. But Equatorial Guinea has experienced a number of political systems, all of which have been influenced in one way or another by the one-party system of government, so it’s going to take a long time to improve the human rights situation, in spite of the «winds of democracy» blowing through the country. The process of economic development is going to have a profound influence on peoples’ daily lives and will eventually set in motion radical social changes — which, let’s face it, are taking a long time to come.
Malabo is Equatorial Guinea’s capital, and is well set to become Central Africa;s richest city. Major oil producing companies have already established themselves in various parts of the country, and, according to the Mines and Energy Ministry, others might soon be on the scene as well. Oil companies already on the spot include Mobil, Triton Energy which is drilling off Malabo and hopes to tap oil reserves estimated at 500 million barrels. Then there’s Chevron, Vanco Energy, TotalFina-Elf and Petronas.
Equatorial Guinea is a former Spanish colony with a population of some 450,000 inhabitants. Hopes are high for the country’s future economic development and gross domestic product, thanks to the discovery of vast oil deposits. And if further deposits are discovered then who knows for the future? But, and this is an important «but», the cost of living is high and could go even higher in spite of a gross national product estimated between US $1,080 and $1,350 per person.
However, it’s disturbing to note that with increased economic opportunities, issues relating to freedom of speech, improvements in the country’s judicial system, standards of health and education, do not match the changes brought about by the oil discoveries. Rather, emphasis has been placed on the construction of roads, public buildings, oil refineries — all thanks to income from oil. But Equatorial Guinea’s population have yet to feel any real benefits from the oil «manna».
A country in full expansion
Incat has the contract to build and run the future Luba Port for a period of 25 years. Presently, the company is building a new quay and is clearing the port from wrecked and rusting former Soviet ships. The first phase of work is costing Incat some $22 million. The company has also got an major contract to build sixty villas in Luba, not far from the old town which was well known for its trading facilities and as a staging post for ships going further south. The building site covers some thirty hectares and should attract foreign industrialists and business people from diverse projects.
The Mines and Energy Ministry has let it be known that the various companies working in Equatorial Guinea will use Luba as their headquarters, especially those involved in enterprises in the Gulf of Guinea. Adam R. Wiltshire is director of the Baker Hughes Company which provides oil companies with equipment and drilling technology. He states: «Malabo Port has become too small and is not able to cater for present economic needs. It simply can’t cope with the amount of shipping and the processing of imports arriving from abroad».
Incat also has a major interest in the civil engineering sector and has recently won a contract to build the main roads leading to and from Malabo. These include a four-lane 7.5 kms highway linking the airport to the city centre, as well as repairing the 52 kms Malabo-Luba highway. Incat has also built the Malabo oil refinery, some 2 kms from the airport, and has created several hundred jobs in the process for local people.
Cocoa production decreases
Murano Owono is an official from the Ministry of Agriculture. On a recent visit to Equatorial Guinea’s cocoa producing areas, he said: «In spite of the fact that people have been leaving the cocoa plantations alongside the Malabo-Luba highway, there is every hope of once again introducing cocoa production. The State promises to provide free pesticides to farmers for their plantations and to encourage them once again to resume cocoa production.
The few remaining cocoa plantations are to be found on mainland Equatorial Guinea. According to Malabo’s Chamber of Commerce, in 1999 the 50,000 hectares of cocoa plantations on Bioko Island generated just a few hundred million CFA francs, compared to the 900 tons of cocoa harvested in 1980 which brought in CFA francs 3.5 billion. The plantations’ labour force comes mainly from Cameroon, Liberia and Nigeria. The few plantations are to be found in the Mikomeseng-Ebebiyin region.
A senior Agriculture Ministry official has stated: «The country has never achieved the pre-independence high production level. In 1999, production had fallen to less than 5,000 tons. And because cocoa prices were continually falling, a number of planters chose to sell their products (illegally) in Cameroon or Gabon, or even preferred to abandon the plantations altogether and look for a job in the more lucrative oil sector».
The cocoa sector employs the highest proportion of Equatorial Guinea’s workforce. But the region’s damp climate and lack of well-maintained plantations has caused the drop in cocoa production. Now the State is encouraging its citizens to return to farming. In the 1980s, Equatorial Guinea’s economy was entirely dependent on cocoa and coffee production. But with the world economic crisis and the consequent drop in prices, low production levels of these two mainstays of the country’s economy plunged Equatorial Guinea into a state of debt it has never managed to recover from. In spite of the recent oil boom, the country is still in debt and because of speculators, Malabo is one of the most expensive towns of the region. Just a few facts and figures: In 1987, Equatorial Guinea’s debt was $169 million — 30% of its Gross National Product. The country continues to import most of its necessities from Europe, and African countries such as Cameroon, Nigeria and Liberia. The Government has still not succeeded in completing the country’s economic recovery and remains dependent on imports, nothing being manufactured on the spot.
Human rights
Some months ago, Gustavo Galion Giraldo, the United Nations special representative for human rights in Equatorial Guinea, led a UN delegation to that country. The delegation was received by Prime Minister Angel Serafin Seriche Dougan. The UN‘s previous special representative had been declared persona non grata by the Malabo authorities because of his «negative outlook» on the country’s interior affairs. Mr Galion now said: «Equatorial Guinea’s government has said it is prepared to put into practice the United Nations’ recommendations, so that the present delegation can draw up an objective report concerning the improvement of the human rights situation in Equatorial Guinea».
In May this year, the Democratic Party of Equatorial Guinea (PDGE, the former party in power), won the local elections, principally because the main «radical» opposition parties boycotted the elections. Up for grabs were 244 local council seats in 30 municipalities. Of the 244 seats available, the PDGE won 230, the 14 remaining seats being won by moderate opposition parties. The PDGE won all 30 town halls. Twelve parties took part in the election campaign (13-28 May) but most disappeared from the scene. The opposition parties didn’t run much by way of a pre-election campaign, as they were calling for the previous electoral lists to be used, but the authorities refused to listen. The result? Equatorial Guinea’s pre-election campaign took place in complete indifference, with the three main opposition parties boycotting the ballot boxes in an election they termed «an electoral joke».
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