Why the wealth of Africa does not make Africans wealthy

Story highlights

  • The book 'The Looting Machine' documents resource extraction across Africa
  • Resource dependency is often linked to repressive regimes
  • Author demands reform of offshore banking system exposed in 'Panama Papers'

(CNN)Katanga province in the Democratic Republic of Congo is blessed with enormous natural wealth, including vast deposits of precious minerals such as diamonds, gold, and tantalum.

Katanga saw a spectacular mining boom around the turn of the century, when President Laurent-Desire Kabila and then his son Joseph licensed international mining companies to tap its treasures.
This arrangement generated riches for the Congolese elite, and vastly more for the prospectors, but offered little to the poverty-ravaged population. From 1999 to 2002, the Kabila regime "transferred ownership of at least $5 billion of assets from the state-mining sector to private companies under its control... with no compensation or benefit for the State treasury," a United Nations investigation found.
    The bonanza coincided with a ruthless crackdown on dissent. In 2004, a small, mostly civilian group took over a mine operated by the Australian firm Anvil Mining in Kilwa village, protesting that the company was making huge profits without rewarding the local workforce.
    According to a UN report, the Congolese army crushed the uprising and killed around 100 people, many by summary execution.