The resource-based corruption and international greed that has typified so much of the West's interactions with African countries has now arrived in the tiny and impoverished West African country of Gabon. Only this time, the external predator, working in tandem with a venal, autocratic local ruler, isn't the West -- it's China. And the tactics are new as well. China, instead of following in the West's footsteps and setting up donor relationships with cash-strapped African states, is trading development revenue for natural resources, pouring more than $29.3 billion since 2002 into the continent through development projects geared at the exploitation of finite resources, financed by China's state-owned export-import bank China Exim. This barter system doesn't just allow China to differentiate itself from the colonialists; it has also redefined Africa's foreign investment risk profile, leading to a 2007 agreement between China Exim and the World Bank to collaborate on investment via construction projects. But don't be fooled: China's goals in Gabon are no less selfish -- and the potential outcome is no less disastrous -- than any misguided colonial project of the past.
Until 1960, Gabon was a French colony, a focal point of France's "Africa" policy of Françafrique, composed of secretive defense agreements, multinational corporations, and handpicked governors. Since independence, the country has existed in a state of forced peace, maintained by France's Marine infantry battalion, which remains stationed in the capital city of Libreville. But class-based conflict is always a potential threat: Gabon's per capita GDP is relatively high, at $14,000, but the political elite hoard the wealth and keep everyone else in poverty. Seventy percent of the population lives under the poverty line, and state services ranging from health care to sanitation do not exist. Gabon has little to no infrastructure: Only 10 percent of the roads are paved, with 80 percent of the land forested.
It's this forested region, in the Ogooué-Ivindo province, that is at stake today. Iron ore, billed as one of the world's last remaining major untapped deposits, was discovered there in 1885. The remote area is estimated to hold 1 billion tons of ore, with iron content of 64 percent. In 2006, Gabon's then-lifetime dictator, Omar Bongo, awarded a $3.5 billion mining deal to a Chinese consortium. The project, wholly financed by China Exim, includes the $790 million Belinga mining facility; two hydroelectric dams designed to electrify the mine, Grand Poubara and Kongou Falls (the latter with a price tag of $754 million); a 350-mile railway; and a deep-water port at Santa Clara engineered to transport resources from northeast Gabon to the Atlantic -- and, of course, on to Beijing. The first shipments are scheduled to leave for China in 2011, with an estimated 30 million tons to be extracted each year.
According to the secretive development agreement, China received a 25-year tax holiday, despite profits projected within the first eight years; 90 percent of the profits thereafter; and some regulatory exemptions, including environmental ones such as alleged cheapened access to forested regions and rivers, as well as significant control over the country's infrastructure, which the Chinese are to develop.
Earlier this year, Bongo died and his son, Ali-Ben Bongo Ondimba (also known as Bongo Jr.), was elected president at the end of August, an event that will probably just grease the wheels for Chinese investors. Even Bongo Jr.'s personal assistant is Chinese. And Gabon is clearly excited to get its hands on some of China's money. The country is one of sub-Saharan Africa's top five oil producers, with oil accounting for 80 percent of its export earnings, but its reserves are dwindling. Production is down from 351,890 barrels per day (bpd) in 1998 to 270,000 bpd now. Gabon holds just 2 billion barrels in proven reserves, not much compared with Nigeria's 32.6 billion.