Britain’s scramble for Africa: The new colonialism

Written and researched by Mark Curtis, the report reveals the degree to which British companies now control Africa’s key mineral resources, notably gold, platinum, diamonds, copper, oil, gas and coal. It documents how 101 companies listed on the London Stock Exchange (LSE) – most of them British – have mining operations in 37 sub-Saharan African countries and collectively control over $1 trillion worth of Africa’s most valuable resources.

The UK government has used its power and influence to ensure that British mining companies have access to Africa’s raw materials. The report exposes the long-term involvement of the British government (Labour and Conservative) to influence and control British companies’ access to raw materials. Access has been secured through a revolving door between the political establishment and British mining companies, with at least five British government officials taking up seats on the boards of mining companies operating in Africa.

Augmented by WTO rules, Britain’s leverage over Africa’s political and economic systems has resulted in a company like Glencore being able to to show revenues 10 times that of the gross domestic product (GDP) of Zambia.

Under the guise of the UK helping Africa in its economic development (a continuation of the colonial paternal narrative), $134 billion has flowed into the continent each year in the form of loans, foreign investment and aid, while British government has enabled the extraction of $192 billion from Africa mainly in profits by foreign companies, tax dodging and the cost of adapting to climate change.

The report highlights the roles played by major companies, such as Rio Tinto, Glencore and Vedanta. From the displacement of people and killings to labour rights violations, environmental degradation and tax dodging, Africa appears to have become a free for all. In only a minority of mining operations do African governments have a shareholding in projects. And even if they do, it tends to be small at 5-20%.

In the report, Mark Curtis argues that an African country could benefit from mining operations by insisting that companies employ a large percentage of their staff from the country and buy a large proportion of the goods and services they procure from the country. However, World Trade Organisation rules prevent African countries from putting such policies in place.

Countries could also benefit from corporate taxation, but tax rates and payments in Africa are minimal and companies are easily able to avoid paying taxes, either by their use of tax havens or because they have been given large tax incentives by governments — or often both. And when companies export minerals, governments usually do not benefit at all. Governments only benefit from exports when there is an export tax. There are almost none in Africa.

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by Colin Todhunter

Photo Credits: Constructionhunter.au