The Looting Machine

1. Africa's Riches Fuel a "Looting Machine"

Yet the machinery that is looting Africa is more powerful than all of them.

Systematic plunder. Africa is immensely rich in natural resources like oil, minerals, and diamonds, holding a third of the world's hydrocarbon and mineral resources. However, this wealth is not a blessing but a curse for most Africans. Instead of fostering development, these resources fuel a systematic process of looting.

Concentrated wealth. Resource rents, the unearned income governments receive from licensing extraction, create a large pot of money controlled by those in power. This concentrates wealth and power in the hands of a few, often leading to "big man" politics and kleptocracy, where government is by theft.

Modernized machinery. The looting machine has evolved from colonial-era land grabs to complex networks of multinationals, middlemen, and African elites. These networks operate through secretive offshore vehicles and impose terms that bleed profit from destitute nations, serving their own enrichment above all else.

2. Shadow States Fuse Power and Private Gain

the ruling elite enthusiastically converted to crony capitalism.

Privatization of power. In resource-rich African states, political and economic power are often fused, creating "shadow governments" or "cryptocracies" where the ruling class treats state assets as personal property. Elites, often military figures or presidential families, take personal ownership of national riches.

State-owned engines. Companies like Angola's Sonangol or Nigeria's NNPC serve as financial engines for these shadow states. They control vast revenues, operate with little oversight, and extend their tentacles into every sector of the domestic economy, blurring the lines between public and private interests.

Impunity thrives. This fusion of state and corporate power allows elites to operate with impunity. They control security services, manipulate elections, and silence critics, ensuring there is little incentive to relinquish power or be held accountable for the billions that go missing from state coffers.

3. Foreign Complicity Powers the Plunder

In the place of the old empires are hidden networks of multinationals, middlemen and African potentates.

New form of empire. The looting machine is not solely an African phenomenon; it is powered by foreign complicity. Hidden networks of multinationals and middlemen from the West and East partner with African elites, forming transnational entities aligned to no single nation but serving their own enrichment.

Gatekeepers and facilitators. Foreign companies need access to resources, and African elites control that access. Middlemen, often with backgrounds in finance or intelligence, bridge this gap, cultivating personal ties and facilitating deals that benefit the few at the expense of the many.

Global reach. These networks operate in the underbelly of globalization, where criminal enterprises and international trade overlap. They stretch from African war zones and presidential palaces to the pinnacles of power and wealth in New York, London, and Hong Kong, connecting plunder to global markets and consumers.

4. The Resource Curse Breeds Poverty and Inequality

despite the prospects of wealth and opportunity that accompany the discovery and extraction of oil and other natural resources, such endowments all too often impede rather than further balanced and sustainable development.

Economic distortion. The influx of dollars from resource exports inflates the local currency, making imports cheaper and undercutting local industries like manufacturing and agriculture. This phenomenon, known as "Dutch Disease," prevents diversification and increases dependency on volatile commodity prices.

Concentrated opportunity. The resource sector requires vast capital but employs few people compared to other sectors. As other parts of the economy wither, opportunity becomes confined to the resource business, creating enclaves of wealth for the few while the majority remain in extreme poverty.

Inequality persists. Resource-rich countries often exhibit extreme inequality. Wealth is concentrated at the top, and economic growth, when it occurs, primarily benefits the already rich and powerful, failing to translate into improved living standards, health, or education for the average citizen.

5. China's Rise Creates New Corrupt Alliances

Combined, the three flags are ensigns of a new kind of empire.

Infrastructure for resources. China's voracious hunger for resources has led to massive investment in Africa, often through "Angola Mode" deals: cheap loans for infrastructure built by Chinese companies, repaid in oil or minerals. This offers African states an alternative to Western donors but often lacks transparency.

Middlemen and guanxi. Navigating Africa's resource landscape requires connections. Chinese state-owned companies often rely on middlemen, like Sam Pa and the Queensway Group, who possess "guanxi" – personal ties to both Beijing and African rulers – to secure deals and bypass traditional channels.

Replicating old tactics. While promising a new path, China's approach often replicates the tactics of old colonial powers and Western multinationals. Deals are opaque, terms are often unfavourable to African states, and alliances are forged with repressive regimes, sometimes involving cash payments and security support.

6. Offshore Secrecy Hides the Loot

These networks fuse state and corporate power. They are aligned to no nation and belong instead to the transnational elites that have flourished in the era of globalization.

Veil of secrecy. The looting machine thrives on secrecy. Deals are often struck behind closed doors, contracts are unpublished, and companies involved are registered in offshore tax havens like the British Virgin Islands or Cayman Islands, where ownership information is concealed.

Illicit financial flows. This secrecy facilitates massive illicit outflows from Africa. Money is siphoned off through corruption, theft, and sophisticated tax fiddles like manipulating the prices at which goods and services are traded between subsidiaries of multinational companies.

Global architecture. The international financial system, with its vast architecture of offshore secrecy, is stacked against African states. It allows wealth to be accumulated by the few and spirited out of the continent, depriving governments of the tax revenues needed for public services.

7. Violence Enforces the Resource Compact

Often it means others must die.

Struggle for rent. The competition to control the finite pot of resource rent is a zero-sum game, a "struggle for survival at the highest level." This competition fuels violence, as factions, militias, and political elites use force to capture and protect their share of the wealth.

Ethnic manipulation. In states hollowed out by corruption, political power relies on patronage, not public service. Politicians mobilize ethnic or religious identities to secure support, turning political contests into violent clashes where winning means the other group must lose access to resources.

Militias and security forces. Armed groups, whether rebel militias, state security forces, or criminal syndicates, are integral to the looting machine. They control mining areas, extort payments, intimidate opponents, and enforce the compact of violence that underpins the system.

8. International Institutions Often Fail to Curb Abuse

The international community itself protects these guys.

Compromised mandate. Institutions like the World Bank and IMF, tasked with reducing poverty and promoting development, have often failed to curb the abuses of the resource industry. Despite evidence that oil and mining investments often impede development, they continue to provide funding and legitimacy to contentious projects.

Ignoring warnings. Internal reviews have highlighted the detrimental impact of resource dependency and the World Bank's role in it, recommending phasing out oil investments and ensuring projects benefit local communities. However, these recommendations have largely been ignored by management.

Lax conditions. Faced with competition from new players like China, traditional lenders have sometimes become more lenient, providing loans to corrupt governments with fewer conditions. This allows regimes to gain legitimacy and financial support without implementing meaningful reforms or increasing transparency.

9. The Human Cost: Poverty, Violence, and Death

For the rest, little remains but dead dogs and promises.

Widespread deprivation. Despite immense national wealth, the majority of people in resource-rich African states live in extreme poverty, lacking basic necessities like clean water, healthcare, and education. Average incomes are often far below the global average.

Tragedy and suffering. The looting machine inflicts terrible human costs. It drives millions from their homes, fuels conflicts characterized by extreme violence and atrocities, and contributes to high rates of infant mortality and low life expectancy.

Abdication of duty. Rulers, insulated from accountability by resource rents, abandon public service. Instead of addressing pandemics, hunger, or unemployment, they focus on maintaining power through patronage, leaving citizens to fend for themselves in a dysfunctional system.

10. Global Consumers Are Part of the System

Don’t think you’re not involved.

Invisible links. The products we use daily – mobile phones, cars, jewelry, aluminum cans – contain raw materials sourced from Africa. These commodities flow through complex global supply chains, often originating from areas scarred by conflict and corruption.

Profiting from plunder. Our pension funds and investments are often tied to the shares of multinational oil and mining companies that operate in these resource states. We benefit financially from an industry that is deeply intertwined with the looting machine.

Choosing to avert gaze. The suffering caused by the resource trade is often out of sight and out of mind. As long as consumers and investors choose to ignore the provenance of their goods and the source of their profits, the looting machine will continue to turn, perpetuating poverty and violence.

Last updated: June 25, 2025