Guinea is one of the poorest countries on the planet. There is little industry and scarce electricity, and there are few navigable roads. Public institutions hardly function. More than half the population can’t read. “The level of development is equivalent to Liberia or Sierra Leone,” a government adviser in Conakry, Guinea’s ramshackle seaside capital, told me recently. “But in Guinea we haven’t had a civil war.” This dire state of affairs was not inevitable, for the country has a bounty of natural resources. In addition to the iron ore in the Simandou range, Guinea has one of the world’s largest reserves of bauxite—the ore that, twice refined, makes aluminum—and significant quantities of diamonds, gold, uranium, and, off the coast, oil.
Keefe's report details the saga of Guinea's massive Simandou iron ore mine, in the interior highlands of east of the crescent-shaped country, north of Liberia. In particular, Keefe records the account of Israeli billionaire Benny Steinmetz's success in gaining control of the Simandou rights, in which the original concession was stripped multinational giant Rio Tinto, only to be handed over to one Steinmetz's companies, who then resold its interest in the potential mine to Brazilian behemoth Value, for billions of dollars in profit, as Guinea lurched from the death of its President-for-Life Lasana Conté, through chaotic military junta, to nascent democracy under General Alpha Condé.
Instead, B.S.G.R. could pursue a cheaper option: exporting the ore through Liberia, which already had the necessary infrastructure. For years, the government of Guinea had resisted such a scenario when Rio Tinto had proposed it. As a concession, B.S.G.R. agreed to spend a billion dollars developing a passenger railway for Guinea.
It's definitely worth reading in full (as well as the Photo Booth feature that accompanied the article), not only because it carefully explains a very complex situation and is otherwise thoughtfully written, but because of its dramatic unfolding, including President's wife's collusion with an aging Steinmetz proxy, which may have resulted in the purchase of a McMansion in Jacksonville, Florida; only the most memorable detail of what is a sprawling opera of kleptocratic corruption.
Cilins hired Touré’s brother to help promote the company’s interests in Guinea, then secured an introduction to her. Not long afterward, Cilins and several associates from the company obtained an audience with the President.While the story is compelling in that documentary evidence seems to exist that would prove the guilt of a billionaire taking advantage of one of the world's poorest countries. But the best passages of the Keefe's stellar 13-page story are those that zoom outward for a panoramic view of 21st-century robbery of African nations. The Simandou saga is allegorical of the kleptocratic corruption in many corners of Africa:
But how do you prove corruption? By its nature, corruption is covert; payoffs are designed to be difficult to detect. The international financial system has evolved to accommodate a wide array of illicit activities, and shell companies and banking havens make it easy to camouflage transfers, payment orders, and copies of checks. Paul Collier argues that there are often three parties to a corrupt deal: the briber, the bribed, and the lawyers and financial facilitators who enable the secret transaction. The result, he says, is “a web of corporate opacity” that is spun largely by wealthy professionals in financial capitals like London and New York. A recent study found that the easiest country in which to establish an untraceable shell company is not a tropical banking haven but the United States.
The story has developed since July, as this Guardian report from earlier this month details how Britain's Serious Fraud Office (love that name) has taken up the investigation into Beny Steinmetz's holdings in the UK and Guernsey.