Private Empire: ExxonMobil and American Power by Steve Coll

Author:Steve Coll
Language: eng
Format: mobi, epub
Tags: Industries, Government & Business, Infrastructure, Corporate Power, Business, Big Business - United States, Energy, Economics, Petroleum Industry and Trade, bought-and-paid-for, General, United States, Petroleum Industry and Trade - Political Aspects - United States, Exxon Mobil Corporation, Biography & Autobiography, Exxon Corporation, Political Aspects, Big Business, Corporate Power - United States, Business & Economics
ISBN: 9781594203350
Publisher: Penguin Press
Published: 2012-05-01T04:00:00+00:00

When he reflected publicly on Africa, Wolfowitz grouped its countries into three broad categories: About a third of the continent’s nation-states seemed to be hopeless basket cases, including Sudan, Somalia, and Zimbabwe. About another third, endowed with oil and other natural resources, were doing better, but were struggling with the resource curse—Angola, Equatorial Guinea, and Chad were examples. Another third were becoming successful, registering positive economic growth rates for ten years or more—Botswana, for example, and also previously failed states such as Mozambique and Rwanda. Wolfowitz felt the World Bank had an opportunity to promote a more nuanced picture of Africa’s economy. The continent’s negative image “wasn’t helped by large rock concerts that talk about what a miserable, failing place it is,” he remarked. He did not blame Bono or U2 for this image problem; he blamed dictators like Zimbabwe’s Robert Mugabe. Chad’s ruler was nowhere near as bad as Zimbabwe’s, but no good would come from appeasing Déby on the matter of his arms purchases, Wolfowitz concluded.

Chad has a sovereign right to decide how to spend its oil money, Déby argued to Wolfowitz over the telephone on the night of January 5, 2006.15

Their conflict had reached a climax. Wolfowitz was threatening to freeze the money ExxonMobil and its partners deposited in Chad’s Citigroup accounts in London—an action he could take by invoking the bank’s rights under its pipeline lending agreements. Even though the amount the bank had lent to Chad was relatively small—less than the annual oil revenue Déby now received—under the loan terms, the bank could seize Déby’s oil funds.

Wolfowitz told Déby that he accepted that Chad was sovereign. However, Chad’s sovereign government had entered into certain contractual commitments with the World Bank to spend oil revenue on the health, education, and welfare of Chad’s people. It was in the interests of Chad’s sovereign government, Wolfowitz argued, to show the world that it was an honorable party to the agreements it had made.

They talked through French translators that night for two hours. Neither of them budged. The next day, Wolfowitz announced that the World Bank would withhold new loans to Chad; a freeze on its bank account would follow if Déby still refused to compromise.

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