A recent article by Barry Meier and Jad Mouawad reports that, even before oil has been extracted from the newly discovered oil-rich wells of São Tomé and Principe, corruption has manifest itself in the small island country off the West coast of Africa. This opportunity for international development already needs revamping before the oil—and cash—really starts to flow.
The issues center around numerous investigations related to oil negotiations in São Tomé that have already sprung up internationally. These include the indictment of William Jefferson, a Democratic congressman from Louisiana, for soliciting a bribe to aid in an oil-related dispute, the investigation of a Houston-based company to determine if its large holdings in São Tomé were gained through bribes, and the investigation of the chairman of ERCH Energy, a Nigerian businessman, who is suspected of participating in insider oil deals. This sort of corruption, along with basic mismanagement of funds, has lead to the loss of at least $58 million in bad oil deals—and that is just the beginning, according to Martin Sandbu, a specialist in the political economy of natural resource wealth at the University of Pennsylvania’s Wharton School of Business.
That so much money has already been squandered or illegally handled does not bode well for the future of São Tomé’s oil industry, or the vast potential the revenue could have for development projects. The fear is that the country will become another example of the resource curse instead of a poster-child for how well planned international development can be beneficial. São Tomé’s hope for avoiding such a situation lies in the high level of international activism, especially by the development superstar, Jeffrey Sachs. The Earth Institute at Columbia University outlined its ‘Action Plan’ for São Tomé and Principe as focusing on the key areas of, “health, education, agriculture, physical infrastructure, oil revenue management, electrification, telecommunications, and fisheries.” While those focus points cover multiple disciplines, do they cover enough disciplines? The problems cited above stem from a weak political infrastructure, something not focused on in the ‘Action Plan.’ While new laws have been drafted, if the government is not capable of enforcing such laws, they will not be effective and there will be still more indictments and investigations. Though the project is already “multidisciplinary,” does it need to incorporate even more disciplines to ensure that there will be advantageous development for the people of São Tomé?