[Congressional Record Volume 153, Number 111 (Thursday, July 12, 2007)]
[Extensions of Remarks]
[Pages E1500-E1501]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   LINKS BETWEEN OIL, POVERTY, AND CORRUPTION ON CONTINENT OF AFRICA

                                 ______
                                 

                          HON. DIANE E. WATSON

                             of california

                    in the house of representatives

                        Wednesday, July 11, 2007

  Ms. WATSON. Madam Speaker, I rise today to address the links between 
oil, poverty, and corruption that plague too many people on the 
continent of Africa.
  Kensington International is a United States-based firm that is owed 
money by the Government of the Republic of Congo. In an effort to 
collect on its debts, Kensington took the Government of the Republic of 
Congo to Court in Hong Kong. The Government of Congo, based in 
Brazzaville, had claimed that, because of the poverty of their nation, 
that they were unable to pay their debts.
  I would encourage my colleagues to examine the documents produced as 
evidence in this court case. They are available on the Internet at 
www.globalwitness.org, under the heading, ``Congo: Is President's son 
paying for

[[Page E1501]]

designer shopping sprees with country's oil money?''
  The documents online include:
  1. Bill for credit card spending by Mr Christel (son of President, 
head of Cotrade) on luxury items and other apparently personal 
expenses.
  2. Bank letter indicating that Long Beach Ltd is paying credit card 
bills for Mr Christel.
  3. Corporate record identifying Mr Christel as the owner of Long 
Beach.
  4. Credit card bill for Blaise Elenga, counsel to Cotrade, also 
indicating apparently personal expenses.
  5. Bank letter indicating that E Investments Ltd is paying credit 
card bills for Mr Elenga.
  6. Corporate record identifying Mr Elenga as the owner of E. 
Investments, formerly known as Elenga Investments.
  7. Document indicates business relationship between Long Beach, 
Elenga Investments and Sphynx Bermuda, the latter a company controlled 
by Denis Gokana, found by the London High Court in November 2005 to be 
involved in selling state oil through shell companies, a facade 
intended to deceive Congo's creditors, from which he personally 
profited and at considerable cost to the Congolese Treasury.
  8. Documents indicating payments to Long Beach and Elenga Investments 
by Pan Africa, a company involved in oil-related transactions with the 
Congolese state oil company.
  9. Bank documents indicating payments to Elenga Investments by Africa 
Oil and Gas Corporation (AOGC), which was described by the London court 
in 2005 as a ``sham company'' involved in ``sham transactions'', the 
profits of which ended up in AOGC.
  10. Bank documents indicating payments to Long Beach from AOGC.
  11. Documents indicating that Long Beach received payments related to 
sales of Congolese oil by the state oil company.
  These documents are important because they raise serious questions 
about what appears to be personal financial transactions to the benefit 
of public officials with funds that may derive from state oil sales. 
This comes at time when 70 percent of Congolese citizens earn less than 
a dollar a day. Because commitments to prevent conflicts of interest in 
the oil sector are a key condition for Congo to receive full debt 
relief, I am concerned that these documents show a blatant failure to 
comply with the commitments they made as part of the Highly Indebted 
Poor Countries Initiative, also know as ``HIPC''. The Republic of Congo 
committed to the United States, and the international community, in 
March 2006, that, in return for progressing towards full HIPC debt 
relief, that it will carry out reforms of the oil sector including 
``preventing conflicts of interest in the marketing of oil [and] 
requiring officials of SNPC [the state oil company] to publicly declare 
and divest any interests in companies having a business relationship 
with SNPC.'' The context of this commitment is strong U.S. 
Congressional and international concern about corruption in the oil 
sector in Congo. One of the conditions of the HIPC program is the 
completion of a diagnostic study on SNPC's marketing of oil by 
independent auditors, which is not yet completed. The U.S. supports the 
strengthening of the HIPC triggers in relation to oil sector 
transparency and anti-corruption measures. These concerns are 
particularly acute given the Congo's reputation for serious corruption.
  Madam Speaker, too many African governments are unable to serve their 
people because of the crushing burden of international debt. Debt 
relief for Africa needs to be a top priority for the United States, in 
order to enable these governments to serve their people. But we owe it 
to the people of Africa to do debt relief right. We need to make sure 
that we are not rewarding governments that are not serving as good 
stewards of their citizens' national wealth. I urge my colleagues to 
join me in pressing forward to relieve current African debt while 
simultaneously working to prevent the debt cycle from starting all over 
again.

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