dimanche 10 avril 2011

Madagascar Environmental Justice Network: Rajoelina vend le pays aux chinois

Madagascar Environmental Justice Network
Scholars, Activists & Professionals: Social Impacts of Natural Resources Policy

A message to all members of Madagascar Environmental Justice Network

Further to the World Development Movement news release circulated earlier, the article below might be enlightening in some ways. One question might be: should those concerned by the Tar Sands issues look to London, RBS and Madagascar Oil, to France and Total or perhaps further to the East at China Songanol and the China International Fund.....?
Election funds? Try Hong Kong
http://www.africa-asia-confidential.com/article/id/521/Election-funds%3F-Try-Hong-Kong
Antananarivo is looking for resource deals with Asian financiers to raise cash for an election campaign for interim leader Andry Rajoelina
February 2011

The transitional regime led by Andry Rajoelina is threatening to cancel oil exploration licences held by Western investors and hand them to the Hong Kong-based China International Fund. Rajoelina, who seized power with army support in March 2009, needs money to fight presidential elections due in mid-year, which are shaping up to be a bitter confrontation with desposed President Marc Ravalomanana and several other candidates.

Refusing to recognise Rajoelina’s legitimacy after the putsch that brought him to power, the Southern African Development Community, the African Union and the European Union are demanding strict conditions for a return to constitional rule in Madgascar. However, Rajoelina has been able to build up a strong local political support base and win finance on natural resource deals from Indian, Chinese and Pakistani companies.The immediate targets for the Rajoelina regime are the four licences held by London-listed Madagascar Oil, whose operations at the Tsimororo oil field are now subject to a state audit. If the audits find that Madagascar Oil has breached local regulations, the state will press its claims to buy back the licences.

State officials in Antananarivo are also planning to audit the operations of Ireland’s Tullow Oil, India’s Essar, and two British companies, Sterling Energy and Wilton Petroleum – all of which would be subject to sanctions for any operational lapses. These licences could then be taken up by a new holding company, a joint venture between the Malagasy States and the China International Fund (CIF) to invest in local mining projects and business activities.

Hery Rajaonarimampianina, the Finance Minister, says he will release more details before the end of March. According to Mamy Ratovomalala, Mines and Hydrocarbons Minister, the plan is to evaluate all oil and mining exploration projects and take away licences from companies breaking mining laws or not pushing ahead quickly with production plans. Ratovomalala will likely reassign many of the oil licences to CIF’s partner China Sonangol, which has been operating in Angola and Guinea.

A joint-venture holding company between Madagascar and the CIF was launched at a 15 December Conseil des Ministresmeeting. The meeting authorised the creation of the Madagascar Development Corporation (MDC), which will manage the company’s projects throughout the country, the same structure used in Guinea (AAC Vol 2 No 12). The MDC plans to work on agricultural, industrial, tourism and mining projects. CIF will take 85% of the equity; the Antananarivo government will take 15%. Key to these deals with the Rajoelina regime is Mahmoud Thiam, Guinea’s former Mines Minister and now director of CIF’s Guinean subsidiaries.

In what may be the first takeover by the CIF-led venture, Mines Ministry officials called Madagascar Oil executives to a meeting in Antananarivo on 26 January. The officials explained the Ministry’s programme of audits and formally requested to buy back the company’s licences on oil blocks 3104, 3105, 3106 and 3107.

The Office des mines nationales et des industries stratégiques in Antananarivo had warned Madagascar Oil about the audit in a letter after a meeting in mid-December. The audit of Madagascar Oil’s production sharing agreement would take over month, say officials. Yet on 24 January, Minister Ratovomalala referred to a new $1.2 bn. natural resources project that had started up without giving precise details.

Madagascar Oil says it has invested over $200 million in the Tsimiroro oil project. The government plans for an audit comes just as the company was listing on London’s Alternative Investment Market. The Tsimiroro fields have at least 200 mn. barrels of oil, but some claim it could yield more than 3 billion barrels. Given Madagascar Oil’s substantial investment in the project, the government’s decision is likely to be strongly contested.

So far, the two sides are talking about the status of the production-sharing contracts, but not the Bemolanga licence, part-owned by international giant Total. The government may use the $7 mn. in back taxes owed by Total in 2010 as a lever to push the company off its licence.

One company unlikely to be disturbed by the audits is Sino Union Energy Investment Group (Sunpec), which holds rights to Blocks 2101, 2104, 3112 and 3113. Sunpec and its other Chinese partners struck oil on block 3113 in October. In November, Sunpec named Yves-Roger Rajoelina, the President’s father and a retired army colonel, as its special advisor.

Yet the CIF’s track record on raising finance in Angola and Guinea suggests it will take months before the regime gets paid for any reassigned licences or gets revenues from the joint venture projects. CIF – set up in Hong Kong in 2003 and operating sometimes in Singapore – is a private company whose real financial capacity is in doubt. But the reality is that Madagascar’s beleaguered Haute Autorité de la Transition (HAT) regime, led by Andry Rajoelina, has been struggling to find financing from any source.

Foreign-aid givers have blocked new credits since mid-2010 as they do not recognise the HAT as legitimate and previous financing deals are expiring. Budgetary discipline has enabled Antananarivo to keep paying salaries and basic charges but new development projects have almost ground to a halt despite assurances from Rajoelina.

The regime needs cash both to maintain its popular support and to strengthen Rajoelina’s hand in negotiations overseen by SADC and the AU. Rajoelina is pressuring his rivals, including former Presidents Marc Ravalomanana, Albert Zafy andDidier Ratsiraka, into accepting the presidential elections that the regime plans for mid-year.

The regime has had some success in persuading China to provide investment for mining projects. In mid-2010, Hong Kong Wisco Guangxin Kam Wah Resources paid a US$100 mn. signature bonus to a presidential fund for rights to the Soalala iron ore deposit (AAC Vol 3 No 10).

Yet there are already problems with the consortium’s commitment to finance the Soalala project. Kam Hing International Holdings, a Hong Kong-based garment company in China and Madagascar, now says it was a stalking horse for other interests. On 1 February, Kam Hing announced that it would sell 75% of Kam Hing International Limited, which holds 20% of the Soalala mine, for $30 mn. Under the deal, Kam Hing gets another payment of up to $70 mn. if the consortium finds that Solala contains more than 200 mn. tonnes of ore.

The new owner of the 75% stake is an as-yet unnamed Chinese parastatal which needs approval from the China’s National Development and Reform Commission to make payments. Other investors in Soalala are state-owned Wuhan Iron and Steel (Wisco) and the state-owned Guangdong Foreign Trade Group.

Prospects for CIF’s deals in Madagascar are uncertain given doubts about its financial and management capacity as well as the economic stagnation and political instability in the country. Another risk is the Rajoelina regime’s lack of international recognition. A future Malagasy government may renegotiate deals signed with the transitional regime. Yet for now Rajoelina is the favourite to win any election after the political negotiations – despite his earlier promise not to run.



Many thanks to the person who submitted this item above, it is much appreciated!


Visit Madagascar Environmental Justice Network at: http://madagascarenvironmentaljustice.ning.com/?xg_source=msg_mes_network

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Le GTT INTERNATIONAL, collectif de la diaspora malagasy, dont le siège est à Genève (CH), poursuit un double objectif: la restauration de l'Etat de droit et le rétablissement de la Démocratie à Madagascar. Il prône et oeuvre pour la liberté d'expression, la prise de conscience citoyenne et la mise en place d'une vraie démocratie dont l'exigence première est la tenue d'un processus électoral inclusif, libre et transparent ".