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8 December 2003updated 24 Sep 2015 12:01pm

Another nice friend for President Bush

Oil could make a tiny African country, plagued by poverty and disease, as rich as Kuwait. But a US-b

By Lindsey Hilsum

In Malabo, the ramshackle capital of Equatorial Guinea, a Spaniard – jetsam of Africa’s colonial past – told me a story from the early 1970s, when Spain abandoned its only colony in sub-Saharan Africa. His cocoa plantation was confiscated by the newly independent government, and on returning to reclaim it, he was thrown in prison. Suspicions had been raised – he still had money, so the police concluded that he must be keeping a mermaid who conjured up cash from the deep.

Today, the Spaniard runs a bar selling overpriced Rioja to visitors from Houston and Aberdeen. Equatorial Guinea has found a new way of making money from the ocean. It has struck oil offshore. Suddenly this tiny country – five islands and a slice of rainforest squeezed between Gabon and Cameroon – with the worst malaria in the world and some of the worst poverty, has the potential to become as wealthy as Kuwait.

With a population of only half a million – smaller than Shef-field’s – it should not be too difficult to spread wealth around. But although on paper Equatorial Guinea’s GDP shot up 60 per cent last year – the fastest increase in the world – few people felt any difference. Roads and municipal buildings are under construction, but Equatoguinean children still die of dysentery, diarrhoea and typhoid, diseases caused by bad water and poverty. A recent IMF report says the proportion of total government spending that goes towards health has declined from 6 per cent to just over 1 per cent. Next to the statue commemorating Felipe de Santos Toro, who in 1778 became the first white man to land on Bioko, the main island, I watched a woman sorting through a basket of bright orange pine nuts and enormous snails. She had been foraging in the rainforest to survive, just as her ancestors must have done two hundred years ago.

The president, I was told, would see me in his home village, Mongomo, deep in the jungle on the border with Gabon. Teodoro Obiang Nguema came to power 24 years ago when he overthrew and executed his uncle, the country’s first president, known as the “Unique Miracle”. As we sped through the rainforest in a taxi, every few miles the police – or someone – had improvised a roadblock with a bamboo pole balanced across empty oil drums. The man from the ministry of information who accompanied me was dressed in a three-piece suit despite the sweltering heat. He carried a briefcase with documents to prove we were going to see the president, who was recently described by state radio as akin to God, “because he can kill without being called to account or going to hell”. It didn’t stop the men at the roadblocks from demanding money from our driver “for taking a taxi beyond the city limits”, or because “you must pay for carrying white people”.

The oilmen who jet in on the Houston Express or the weekly charter from Gatwick are spared this. Twenty-eight days on, 28 days off, straight out to the rigs and keep taking the malaria pills. Equatorial Guinea’s oil is especially attractive to western oil companies because it is all offshore. In neighbouring Nigeria, groups such as the Ogoni attack Shell’s installations because they live in a landscape changed by the infrastructure of oil, a daily reminder of the industry that has failed to transform their lives. Here the people cannot see the rigs. The World Bank says their government earned roughly $700m from oil last year, but the president has declared the nation’s oil revenue a state secret. In the entire country, there is no daily newspaper, no bookshop, not even a public library. The people know oil has been found, but not that their tiny country is part of a US strategy to diversify from the volatile Middle East. Already, Africa provides 15 per cent of America’s oil – in ten years’ time, it will be 25 per cent. Equatorial Guinea is already the seventh-largest producer in sub-Saharan Africa.

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However, Obiang Nguema and his family are well aware of their new importance. He has met George Bush in Washington, and regularly receives respectful delegations from oil companies. His son Gabriel, the secretary of state for mines and hydrocarbons, was educated in America. Smart and sober in a dark suit, he talks of international investment and improving the welfare of Equatoguinean citizens. Gabriel represents a potential modern future, but the president favours another son, Teodorino, captured on video in Paris at the beginning of the oil boom driving a Bentley, a Lamborghini and a Rolls, and buying 30 haute couture suits on one shopping spree. Teodorino is popular because he hands out money to the poor; he is tipped to succeed his father.

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We reached the president’s village at dusk. At our guest house, the staff brought water from the river in blue plastic buckets. In the morning, we were taken to see the great man. He explained that I had misinterpreted what I had seen. “I can assure you that there’s no poverty in Guinea,” he said, as flunkeys twittered around him. “The people are used to living in a very different way, which you think is poverty. In Guinea what we have are shortages.”

I raised the issue of the account at the Dupont Circle branch of the Riggs Bank in Washington, into which, it is estimated, the oil companies pay $30m-50m per month and to which he is the sole signatory. “I am the one who arranges things in this country because in Africa there are a lot of problems of corruption,” he explained. “If there is corruption, diversion of funds, then I’m responsible. I’m 100 per cent sure of all the oil revenue because the one who signs is me.” He made the motion of signing with his right hand, adding that all transactions were approved by the treasury, but omitting to say that the head of the treasury is his nephew.

Those who would speak out do so at their peril. Last year, 68 men accused of plotting to overthrow Obiang Nguema were tried in a cinema. Human Rights Watch and Amnesty have chronicled widespread abuses, and one opposition activist showed me marks on his arms from torture at the notorious Black Beach prison. The president said he knew nothing of this; it was all the province of the legal system. “We have the most genuine and transparent democracy,” he said. In last year’s presidential election, Obiang won 97 per cent of the vote – the main opposition leader was detained in Black Beach at the time.

As I drove back through the rainforest, I wondered what ExxonMobil, Amerada Hess, Marathon Oil and the others made of the government their investments support. But no oil company would give me an interview. Off the record, an oil executive said: “Sometimes what we call corruption isn’t regarded as corruption here. It’s a different culture.” Another expatriate was less forgiving. “This is the most corrupt place I’ve ever been, and the president’s just a despot,” he said. A 2002 US State Department report notes that “the government budget still does not include all revenues and expenditures”, adding there was “little evidence that the country’s oil wealth is being devoted to the public good”.

In Britain last month, President Bush said: “No longer should we think tyranny is benign because it is temporarily convenient.” Yet the US has just reopened its embassy in Malabo, and the oil companies plan major new investment over the next decade.

Oil could save Equatorial Guinea, providing job opportunities and enough public money for universal healthcare, education, clean water and electricity. But there is no evidence that either the American government or the oil industry has exerted any pressure on the current regime. The danger is that when the people find out how much of the nation’s wealth is being stolen, violence will follow. The country that promised to become like Kuwait could yet end up like its desperate neighbours Liberia, Sierra Leone and Cote d’Ivoire.

Lindsey Hilsum is the Channel 4 News diplomatic correspondent