Corruption in Equatorial Guinea

Corruption in Equatorial Guinea is high by world standards and considered among the worst of any country on earth. It has been described as "an almost perfect kleptocracy" in which the scale of systemic corruption and the rulers' indifference towards the people's welfare place it at the bottom of every major governance indicator or ranking, below nations with similar per capita GDPs.

"Few countries symbolize oil-fuelled corruption and nepotism more than Equatorial Guinea," wrote Jan Mouawad in the New York Times in July 2009. Its corruption system, according to the Open Society Foundations (OSF), is "unparalleled in its brazenness." This government is controlled by a limited group of powerful individuals who divert most of the country's revenues into their own clandestine bank accounts in other nations. Equatorial Guinea’s corruption is so entrenched, scholar Geoffrey Wood has claimed, that it can be classified as a criminal state.

This situation is especially dramatic due in large part to the massive scale of the country's revenues from oil and other natural resources. The Guardian stated the "country is enormously wealthy, thanks to its vast oil reserves, but that wealth is concentrated in the hands of a tiny elite." Despite its GDP per capita of US$32,026 – which makes it richer than any other African country and places it above Spain, Portugal, and Russia – Equatorial Guinea is ranked 136 out of 187 countries in the Human Development Index measure of quality of life. While the people of Equatorial Guinea "should have the per capita wealth of Spain or Italy...they live in poverty worse than in Afghanistan or Chad," said Arvind Ganesan of Human Rights Watch in 2009, attributing this disparity to the government’s corruption, incompetence, and disregard of its own people's well-being. Indeed, most people in Equatorial Guinea remain in abject poverty, with no access to healthcare or education. Meanwhile, any criticism of the ruling class is non-existent due to the government's use of force and intimidation to silence opposition.

Sasha Lezhnev of Global Witness noted in 2008 that the government earns oil revenues in the billions yearly, while the population lives on less than US$1 a day. President Teodoro Obiang is said to have control over the oil reserves and the government, Ganesan claimd, and consequentially the country's immensely rich treasury is "a private cash machine for a few" rather than used for any public benefit. According to the Financial Times, "Foreign diplomats joke that Equatorial Guinea is no more than a secretive family business but one which, as a sovereign country, enjoys a seat at the UN." The nation is known among foreign businessmen as a poor environment for business and investments. The individual who has become most associated in the international media with the corruption of Equatorial Guinea's leaders is Teodorin Obiang, a son of the president whose lavish lifestyle in southern California, Paris, and elsewhere has made headlines and been the target of investigations by American and French authorities, among others.

Because of the staggeringly high levels of corruption, the country always ranks near the bottom of Transparency International’s (TI) Corruption Perception Index. In 2009, only seven countries were lower. It is the only nation in the world since 2008 to receive a score of 'zero' for budget transparency. In 2008, a U.S. State Department report indicated that officials in Equatorial Guinea "frequently engaged in corrupt practices with impunity." In 2014, the country received a score of zero on TI's "Open Budget Index." From 1996 to 2013, the Economic Intelligence Unit gave the country a score of 0.0 for "Control of Corruption." On the National Resource Governance Institute's Resource Governance Index, Equatorial Guinea received a "failing" score of 13/100, ranking 56th out of 58 countries. On Reporting Practices, it received a score of 14/100, for a rank of 55th.

In 2011, Freedom House put Equatorial Guinea in its "worst of the worst" category for governments that violate human rights and civil liberties, which also includes North Korea, Sudan, and Turkmenistan. In its 2014 world report, Human Rights Watch (HRW) stated: "Corruption, poverty, and repression continue to plague Equatorial Guinea.....Vast oil revenues fund lavish lifestyles for the small elite surrounding the president, while a large proportion of the population continues to live in poverty. Mismanagement of public funds and credible allegations of high-level corruption persist, as do other serious abuses, including arbitrary detention, secret detention, and unfair trials."

Corruption system

The Nguema/Mongomo group

Corruption in Equatorial Guinea is carried out via an elaborate system that is the exclusive province of President Obiang and his circle, known collectively as “the Nguema/Mongomo group.” The members of this group divert revenue from Equatorial Guinea's natural resources, including land and hydrocarbon, to their own private accounts.

Equatorial Guinea's corruption system has been called “a seamless and self-reinforcing web of political, economic, and legal power,” whereby the members of the Nguema/Mongomo group employ the power of the government to enrich themselves. Their increasing wealth enables them, in turn, to finance ever more efficiently “the machinery of political control that eliminates effective opposition through repression and/or bribery.” Meanwhile, the group's domination of the legal system enables them to make their misappropriate of wealth appear lawful.

Several sources indicate that there are serious tensions within the group, with considerable competion for power and favors.

Foreign bank accounts and shell companies

Between 1995 and 2004, much of the money extorted from the people of Equatorial Guinea by the Nguema/Mongomo group was deposited in Riggs Bank in Washington, D.C. According to Human Rights Watch, Riggs had been aware of the level of corruption and human rights concerns in the country.\

A 2004 U.S. Senate probe determined that Equatorial Guinea's oil-revenues account at Riggs Bank was controlled by three persons: President Obiang, Africa's longest-serving dictator; his son Gabriel Mbega Obiang Lima (who is Minister of Mines); and his nephew, Melchor Esono Edjo (who is Secretary of State for Treasury and Budget). Two signatures, the President's and that of either his son or nephew, were required to remove funds from the account. From 2000 to 2003, about $34 million was transferred from that account into foreign bank accounts held by shell corporations – for example, an account at Spain's Banco Santander owned by Kalunga S.A., a firm registered in Panama, and an account at HSBC Luxembourg owned by Apexside Trading Ltd. Probes by a Spanish NGO and by the Open Society Justice Initiative showed that millions of dollars from the Kalunga account were spent on properties in Spain purchased in the names of President Obiang and other high officials, former high officials, and Obianga relatives.

Beginnings

This corruption system has existed in more or less its present form since the early 1980s, when the government seized farmland on Bioko Island belonging mostly to Spanish and Portuguese owners and redistributed it to members of the Nguema/Mongomo group.

Later expropriations

Since then, the government has expropriated other valuable land, mostly the homes of poor or middle-class Equatoguineans. Thousands of people have been the victims of these seizures, for which very few of them are compensated and in response to which they have no legal recourse. Many of those who have protested these expropriations have been abused and intimidated by soldiers or police. Officially, these lands are seized for public purposes, but in fact they have ended up in the hands of members of the Nguema/Mongomo group, who have built homes or businesses on the properties. In 2003, for example, Le Temps (Geneva) reported on a village in which 75 people lived in “pathetic poverty,” having been uprooted by the regime from their homes, which had been used to construct a a methanol factory without compensation or apology. A 2013 Amnesty report stated that over 1,000 families in the country had been “forcibly evicted from their homes to make room for roads, up-market housing and hotels and shopping centers since 2003....Many of the houses demolished were solid structures in well-established neighborhoods and the vast majority of the occupants had title to the land. Despite promises of relocation for some of the victims, to date no one has been re-housed or compensated.”