Stealing Africa: The Glencore scandal

I'm watching this video and I felt like sharing. I came across with the Glencore multinational that steals copper from Zambia. 
The numbers are striking. The company buys the copper in Zambia for a symbolic price in relation to the profit they make. From The Guardian:


Glencore denies allegations over copper mine tax
Jamie Doward
First published on Sunday 17 April 2011 00.07 BST
A UK subsidiary of the world's largest commodities broker helped one of its African mining operations avoid paying tens of millions of pounds in tax, according to charities who have analysed a leaked review of its accounts.

The findings of a draft report into internal controls at Zambia's Mopani Copper Mines plc have been categorically rejected by its owner, Glencore, the giant fuel, metals and cereals trader based in the Swiss tax haven of Zug. The report, seen by the Observer, was carried out in 2009 by a Norwegian subsidiary of Grant Thornton, one of the world's largest accountancy firms, at the request of the previous Zambian government.

Its authors alleged the mine's owners "resisted the pilot audit at every stage", a claim denied by a spokesman for Glencore, which owns a 73% stake in Mopani through a company based in the British Virgin Islands, another tax haven.

The report claimed there had been an "unexplainable" increase in Mopani's costs between 2006 and 2008 that allowed it to minimise its stated profits and lower its tax bill. "We suggest the ZRA [Zambian Revenue Authority] does a new tax assessment based on the results of the audit," the report claims.

Glencore, which is preparing a £37bn listing on the London stock market, the capital's biggest ever flotation, said the auditors had failed to factor in rising fuel and labour costs over the period. The audit also suggested Mopani sold copper at artificially low prices to Glencore in Switzerland under a deal struck with the firm's UK subsidiary in 2000. The metal was then sold on, allowing Glencore to take advantage of Switzerland's ultra-low tax regime.


There are claims that the transactions breach international rules ensuring there has to be an arm's-length principle when it comes to sales between related parties. Glencore said all transactions were conducted at an arm's-length basis and at internationally agreed prices.

When asked by the Observer for a response to Glencore's criticisms of the draft report, Grant Thornton International declined on the grounds of client confidentiality.

But charities said the report suggested Glencore had questions to answer. "Based on the Grant Thornton analysis, we estimate that the company's practices potentially cost the Zambian government up to £76m a year in lost corporation tax," said Anna Thomas, head of tax policy at ActionAid. She pointed out the amount was significantly more than the £59m the UK government gives Zambia each year in aid.

The claims have surfaced as Glencore prepares for a listing that will make multimillionaires of the firm's 485 partners. City analysts were astonished to learn the extent to which the company dominates the commodity markets in documents published ahead of the listing. Glencore revealed it controlled 60% of the traded zinc market and 50% of copper. Development charities have contrasted the impending wealth of the company's management with the poverty of Zambians, around two thirds of whom live below the recognised poverty line, according to the United Nations.

The leaking of the report is potentially embarrassing for European governments. Mopani received a €48m development loan from the European Investment Bank (EIB) to help bring prosperity to Zambia. But the report states: "The pilot audit has shown there is a high need for a determined effort at collecting the taxes that are assessed under the laws implemented by the Zambian government." The EIB has informed OLAF (the European anti-fraud office) of the report's allegations and launched an investigation.

Emmanuel Mutati, CEO of Mopani, has described the audit as "flawed and incomplete" saying it did not include a series of third-party transactions that would affect its accounts. "We have also been audited by independent auditors annually," Mutati said. "Every year the independent auditors' report has given Mopani a clean bill of health."

The UK government recently called for new measures to ensure that the poorest people in Africa benefited from mining.

Glencore was founded by Marc Rich, the controversial oil trader who was accused of tax evasion by American authorities but was pardoned by President Clinton on his last day in office. The company, which last year had a turnover of $145bn, is no longer connected to Rich.


The Zambian government has declined to investigate Mopani's tax affairs despite calls from development charities. "We are disappointed with the government's lukewarm reaction," said Savior Mwambwa, executive director of the Centre for Trade Policy and Development, Zambia. "They need to take action and change the whole taxation system."

Watch the video. Make sure you have already eaten for your stomach will be upset if you don't.

Zambian copper miners and their family members got sick
because of the contamination in the copper plant and in the water and environment.

Privatizing, the source or many evils.

Dedicated to Africa the cradle of humanity and civilization

How dare using the cradle of humanity as a raw-material continent?
Ignorance has no boundaries.
The music by Milton Nascimento touches our souls.
It is about Africa.

Chimamanda Ngozi Adichie: Nigerian novelist speaks about the danger of a "single story"

Our lives, our cultures, are composed of many overlapping stories. Novelist Chimamanda Adichie tells the story of how she found her authentic cultural voice — and warns that if we hear only a single story about another person or country, we risk a critical misunderstanding. (Recorded at TEDGlobal, July 2009, Oxford, UK. Duration: 18:49)

"That's how we create a single story: Show a people as one thing, as only one thing over and over again and that's what they become."
Chimamanda Ngozi

I watched the video and found a woman who is not only a great thinker but also a fighter without losing sense of humor.
But be prepared to get angry if you're emphatetic cause biased stories about nations is not easy to stand.

"Chimamanda Ngozi Adichie was born on 15 September 1977 in Enugu, Nigeria, the fifth of six children to Igbo parents, Grace Ifeoma and James Nwoye Adichie. While the family's ancestral hometown is Abba in Anambra State, Chimamanda grew up in Nsukka, in the house formerly occupied by Nigerian writer Chinua Achebe. Chimamanda's father, who is now retired, worked at the University of Nigeria, located in Nsukka. He was Nigeria's first professor of statistics, and later became Deputy Vice-Chancellor of the University. Her mother was the first female registrar at the same institution.

Chimamanda completed her secondary education at the University's school, receiving several academic prizes. She went on to study medicine and pharmacy at the University of Nigeria for a year and a half. During this period, she edited The Compass, a magazine run by the University's Catholic medical students.

At the age of nineteen, Chimamanda left for the United States. She gained a scholarship to study communication at Drexel University in Philadelphia for two years, and she went on to pursue a degree in communication and political science at Eastern Connecticut State University. While in Connecticut, she stayed with her sister Ijeoma, who runs a medical practice close to the university."

(read more about Chimamanda Ngozi Adichie here)

African countries visiting this blog

I'm dedicating this post to the Africans that visit this blog. These are the visits until the middle of my day.
I love when I watch a flag from an African country when I take a look at the stats.
Thank you all.
(click at the image to enlarge)