global witness

Resources, Conflict and Corruption

The Work of Global Wi tness

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Our Mission

Global Witness campaigns to achieve real change by challenging established thinking on

seemingly intractable global issues. We work to highlight the links between the exploitation

of natural resources and human rights abuses, particularly where resources such as timber,

diamonds and oil are used to fund conflict.

In a speech at the Commonwealth Finance Ministers Meeting in London Chancellor of the

Exchequer Gordon Brown said:

“The recent proposal from George Soros and Global Witness to increase transparency in

extractive industries is an excellent example of how private sector companies can positively

contribute to development and poverty reduction - and following the formation of a

partnership to take this work forward at the recent world summit on sustainable

development, more governments, businesses and NGOs must sign up to this initiative and

make it work.”

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How we work

Global Witness works in countries devastated by conflict, massive corruption, and human

rights abuses. Global Witness raises issues central to these problems by carrying out our

own field investigations, often using covert techniques, revealing information that is not

available to others. Global Witness then publishes reports and lobbies policy makers for

significant and lasting change. Our experiences have shown that campaigning work such as

this creates critical “space” for citizens to begin to operate in a democratic manner, for a

civil society to grow.

Global Witness has gained the reputation of an organization with expertise in accountability

and corporate transparency in natural resource management. Our work in Angola has set a

precedent; through identifying a conflict that was made possible by the control and profit

from resources, not about a conflict of ideologies.

Global Witness has been joint nominated for the 2003 Nobel Peace Prize for this work in

Angola and other countries globally, specifically for the pioneering and groundbreaking work

on conflict diamonds.

In the article “Catching The Timber Smugglers On Camera” from Time Magazine in November

1997, Mairi Brahim said that Global Witness were

“…undercover sleuths as daring as James Bond and as tenacious as Sherlock Holmes.”

“The diamond wars were the secret of the diamond trade until, quite suddenly, they were

not. It seemed to happen in an instant, as if a curtain had been ripped aside and there was

the diamond business, spattered with blood, sorting through the goods. Its accuser was a

little-known group called Global Witness.”

Diamond: The History of a Cold-Blooded Love Affair. Matthew Hart. Fourth Estate, London. 2002.

Illegal logging operations on the Thai/Cambodia

border. Global Witness covert operation 1995.

Eighty log-truck traffic jam in Vietnam, fully loaded with

Cambodian logs probably sourced from Snuol Wildlife

Sanctuary. Global Witness investigation 1998.

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Our successes: conflict timber and illegal logging

The Khmer Rouge took control of Cambodia in 1975. Under their

rule, between 1 and 2 million people were killed or died of

exhaustion and starvation. They were ousted from power in

1979 and took to the forests, from where they fought their civil

war with the then government. During this war, which ran from

1979 to 1998, and following the depletion of gems as a source

of revenue, the Khmer Rouge used timber logged from

Cambodia’s only remaining economically valuable natural

resource, its forests, to fund their war effort. Global Witness

calculated that this trade was earning the Khmer Rouge

between $10-20 million per month.

Global Witness, which then consisted of only two full-time and

one part-time staff members, carried out two field investigations

in January and May 1995, which yielded an enormous quantity

of information. This was followed by lobbying trips throughout

Europe and the US, and a release of information to the South

East Asian press. On 26 May 1995 the Thai government bowed

to the international pressure that had been generated and

closed the Thai/Cambodia border to the timber trade, the

principal route of the Khmer Rouge trade. Within one year the

bankrupted Khmer Rouge defected to the government side; we

were told by the intelligence services that the single biggest

contributory factor was that they could not economically

maintain their people or their war.

Global Witness continues its work in Cambodia, now

investigating the continued destruction of its forests and the

diversion of revenues away from the population at large towards

a corrupt elite. We are also the official monitor of a project set

up by the Royal Government of Cambodia and Cambodia’s

international donors (The UN Development Program and the Food and Agriculture

Organisation), charged with investigating instances of illegal logging in Cambodia’s forest

sector. In June 2002, Global Witness succeeded in getting the Cambodian Government to

cancel the logging contract of a prominent logging company long guilty of illegal logging.

“A small British pressure group that almost single-handedly took on the apparently

intractable problem of Cambodia’s disappearing forests appears to have come very close to

achieving that aim”

Bristow J., 1996, Mighty Mouse, BBC Wildlife Magazine Vol14, No. 9, pp60.

Soldier at Koh Kong Log Rest Area, Cambodia.

Global Witness Investigation 1997.

Evidence of illegally felled logs, Dong Mar log

rest area, Cambodia January 2001.

In an attempt to prevent Global Witness from

documenting illegal logging, a bridge is destroyed

by loggers. This bridge was also used by local

communities. Cameroon 2001.

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A case study The Ukranian Mafia and the links between timber and arms

The Global Witness Liberia Campaign investigates and exposes the role of the Liberian

logging industry in financing and facilitating Liberia’s humanitarian disaster and West

African regional destabilization. Having funded the notoriously brutal Revolutionary United

Front (RUF) rebels during Sierra Leone’s civil war, Liberian President Charles Taylor and

many Liberian logging companies continue to violate UN sanctions by financing illegal arms

shipments, funding parastatal militias and threatening the security of neighbouring states.

Businesses involved in extracting natural resources from developing countries are often

found to be closely linked to the funding of conflicts and terrorists and the provision of arms

to governments or rebel groups in the countries in which they operate.

This chart on page 7 shows how the timber and diamond trades in Liberia are closely

associated with money laundering, state looting and the provision of arms to Liberia, in

contravention of a UN arms embargo, and terrorist groups such as al Qaeda.

Leonid Minin, purported head of

Ukranian Mafia on his arrest for

illegal arms trafficking to West Africa.

Italy 2000.

Oriental Timber Company (OTC) logging road, Gerbia County, Liberia July 2001.

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Involved in conflict diamonds trade

Negotiating in arms dealDiamonds

Diamonds

Diamonds

Arms

Arms

International arrest

warrant for

Money laundering

Drugsal Qaeda

Leased airplanes to

Taliban

Sold airplanes to

Victor BoutDiamonds and arms dealer

Business partnerChairman

Chairman

Close associateprovides hardware for

Gus Kouwenhoven, one of the most influential businessmen in Liberia

Dutch

Timber companies

Arranged payment for $500,000of arms of Liberia

Arranged arms deal to Liberia(and RUF, Sudan, Burkino Faso, DRC)

Borneo Java Pts LtdSingapore

Oriental Timber CompanyLiberia

Subsidiary of

Exotic Tropical Timber Enterprise

Liberian

Involved in State looting

President Charles TaylorLiberia

Sanjivan RuprahDiamonds dealer

Imprisoned for drugspossession

Limad AGSwiss

Owner

Evidence of directpayments to

Business associate

Leonid MininReputed head of Ukranian Mafia

Involved in diamonds trade$500,000 of diamonds in

possession when arrested

China Aerospace Science and Technology Corporation

Arranged and financed armsdeal to Côte d’Ivoire. Arms then

transported to Liberia

Other companies

As with much resource extraction in conflict and post conflict areas, the tropical timber

trade has been the focus of criminal gangs. The complex analysis of inter-relationships in

our campaigns, detailed in the above graph, is based on results from Global Witness’ use of

i2 Limited’s award-winning software, which is used as standard by law enforcement and

intelligence agencies worldwide. The software allows organisations to undertake complex

investigations involving huge and varied datasets, providing visualisation and analysis tools,

which are used by 1500 organisations in 90 countries. i2 Limited has very generously

supplied this software to Global Witness, along with intensive support and consultancy.

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Our successes: oil and transparency

Central to the issue of state looting in countries like Angola is a glaring discrepancy:

the progressive impoverishment of a country that has gone hand-in-hand with rising

oil revenues.

The “paradox of plenty” means that although Angola contains natural resources of

potentially enormous value, it is the worst place in the world to be a child. Despite earning

around US$3-5 billon from oil last year (an estimated 87% of state revenue), social and

economic development in Angola has continued to deteriorate. One child now dies of

preventable diseases and malnutrition every three minutes, that is 480 every day. Three-

quarters of the population are forced to survive in absolute poverty on less than one dollar

a day; one in three Angolan children die before the age of five. Life expectancy is a mere

45 years; and about 3.1 million civilians have had to flee their homes since the war resumed

in January 1998.

In December 1999, Global Witness published “A Crude Awakening” - an exposé of

corruption in Angola and an examination of the complicity of the oil and banking industries

in the plundering of state assets. The report sought to challenge the common perception

that the war was solely responsible for all the ills to be found in Angola and provided

one of the first significant insights into those responsible for the mismanagement of

Angola’s wealth.

Meanwhile, the failure of the Angolan state to provide for its citizens has been blamed on

the then state of emergency. The death of the rebel group National Union for the Total

Independence of Angola (UNITA) leader Jonas Savimbi in March 2002 may have heralded

What could the billions in missing

revenues do for war ravaged Angolan

cities like Kuito?

Ordinary Angolans suffer absolute poverty despite the county’s massive

oil revenues.

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the end to that excuse; the international community now has this opportunity to call the

Angolan Government to account over its use of oil revenues. Rising oil revenues have been

diverted straight into parallel budgets of the shadow state. Information emerging from

economists involved in analysis of Angola’s oil sector suggests that up to US$1.4 billion in

revenues - comprising almost a third of state revenue - was unaccounted for in 2001. By

contrast, the UN barely managed to scrape together US$200 million to feed the one million

internally displaced Angolans dependent on international food aid.

Relying on companies to disclose specific information voluntarily has so far failed because

they fear being undermined by less scrupulous competitors and government pressure. The

Global Witness oil campaign calls for mandatory disclosure so that citizens in developing

countries are able to call their governments to account over management of resource

revenue. The “Publish What You Pay” campaign, launched by George Soros and others in

June 2002, has moved the debate on apace, leading to a dialogue within the United

Kingdom between Global Witness, other NGOs, and the leaders of the British Government

who are keen to champion this initiative globally. Global Witness will be extending this

campaign beyond Angola, detailing other failures of transparency, to increase the pressure

on international policy makers and regulators.

“London-based Global Witness, which launched the influential campaign against the trade in

conflict diamonds in 1998, builds on information exposed in the “Angolagate” arms-for-oil

and influence-peddling scandal in France to describe a hidden world of money and

influence that reaches across Europe to the US, Israel and Russia.”

Report on the Angolan oil industry urges freezing of stolen assets. Financial Times.

25 March 2002.

Kibumba refugee camp in Goma, Democratic Republic of Congo.

Martin Adler, Panos Pictures.

A government held enclave in a rebel

controlled territory is deluged by

refugees, Kuito, Angola. Teun Voeten,

Panos Pictures.

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Our successes:conflict diamonds

Diamonds have played a destructive role in several of the most devastating wars in Africa. In

Angola during the 1990s, the civil war was primarily financed by natural resources - oil (on

the government side) and diamonds (the rebel group UNITA). The war cost the lives of at

least 500,000 Angolans, with thousands more maimed due to land mines - a continuing

blight for the population. Economic chaos suffered by the majority of the population has

resulted in the country’s steep decline as defined by all internationally accepted social

indicators.

Diamonds have helped finance, train and equip the Revolutionary United Front in Sierra

Leone, have helped fund the dictatorial regime in Liberia, perpetuated the conflict in the

Democratic Republic of the Congo, financed UNITA rebels in Angola to the sum of US$3.7

billion, and have helped finance political instability and repression in Zimbabwe. The trade in

diamonds is also now being investigated by Global Witness to determine their role in the

financing of terrorism and organized crime, along with governments around the world.

In December 1998, Global Witness published the report “A Rough Trade: The Role of

Companies and Governments in the Angolan Conflict”. The report exposed the role of

diamonds in funding and perpetuating the civil war in Angola. It also established that the

global diamond industry, trading and marketing system, perpetuated conflicts through the

sale of rough diamonds. This was also exacerbated by the failure of UN member states to

implement UN Security Council resolutions banning the trade in diamonds out of countries

suffering conflict (a criticism also communicated by Global Witness during an unofficial

briefing of the United Nations Security Council). The report helped to prompt the setting up

of expert panels to prevent this failure from being repeated elsewhere. The report, and the

Angolan security forces guarding a government controlled diamond

mine at Saurimo. Global Witness investigation 2001.

Washing gravel for diamonds in the Makeni

River, Sierra Leone, Global Witness

investigation 2000.

continuation of war, led to the international movement to eradicate conflict diamonds,

known as the Kimberley Process; comprising of international NGOs, governments and

organisations such as the World Bank and the UN.

The Kimberley Process is a government run import and export control regime and will

launch on 1 January 2003. For the first time in its one thousand year history the diamond

trade will be subject to an international control mechanism. In just over 3 years a US$56

billion a year industry has been forced to face up to its significant international

responsibilities or be prepared to face the significant consequences of non-compliance. In

that time UNITA have virtually disbanded, and Charles Taylor’s regime in Liberia is teetering

on the edge of survival.

On 19 March 2002, Global Witness was jointly nominated with Partnership Africa Canada

(PAC) for the 2003 Nobel Peace Prize. The nomination was made by United States

Congressmen Tony P Hall and Frank R Wolf, and by US Senator Patrick Leahy, for the

efforts devoted to ending the trade in conflict diamonds.

In the end, our work is not about an award, and it is not about agreements. It is about

putting an end to the horrific wars and regional instability fuelled by the quest for cheap and

exploitable natural resources. It is about ending cycles of endemic and systematic

corruption that helps contribute to humanitarian suffering, which are made possible by the

lack of transparency endemic within the diamond trade.

Land mine victims learn how to walk with artificial limbs. Refugee camp in Kuito, Angola. Teun Veoten, Panos Pictures.

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Our vision

We believe that it is possible for resource revenue to be used to help promote peaceful and

sustainable development, rather than being, as is too often the case, a driving force for

conflict and state looting. The widespread abuse of human rights, environmental

destruction, poverty and economic insecurity that are part of the landscape of modern day

conflict are, in many cases, intricately linked to resource extraction.

Far from being isolated examples, our current campaigns and exposés in the oil, diamond

and timber business have highlighted a much wider problem, where political and economic

disorder brought about by conflict have provided the cover for the wholesale looting of state

assets by combatants and their economic allies. Perhaps the most shocking example of this

uncovered by Global Witness was the “Million Metre Deal”, negotiated by the battlefield

enemies in Cambodia (the Khmer Rouge and the Cambodian Government) to export over 1

million cubic metres of tropical timber (to yield an estimated US$ 90 million for the Khmer

Rouge) from rebel-held areas for their mutual enrichment under the “fog of war”. It is a

sobering thought that the elites of both sides in this civil war tried to enrich themselves

through this deal, whilst their troops were dying on the battlefield. Global Witness prevented

this deal by bringing evidence of it to Cambodia’s international donors; the International

Monetary Fund, the Asian Development Bank and the World Bank.

Natural resources that should be promoting equitable development, and income that should

help eradicate poverty are misappropriated and mismanaged. Rising revenues from

resource extraction have generally gone hand-in-hand with declining indicators of human

development. Recent analyses by the World Bank identify a clear statistical relationship

between states with dependency on primary extractive industries and unaccountable state

institutions that are linked to poverty and civil conflict. This “paradox of plenty” indicates,

for example, that states dependent on primary resource exports are over twenty times more

likely to suffer a civil war than non-dependent countries. Oil, gas and mining industries are

important in over 50 developing countries, which are home to some 3.5 billion people and

where 1.5 billion of those people live on less than $2 per day. Twelve of the world’s 25 most

mineral-dependent states and six of the world’s most oil-dependent states are classified by

the World Bank as Highly Indebted Poor Countries with amongst the world’s worst Human

Development Indicators.

At the moment, natural resources can be accessed and traded with almost no reference to

their link with instability and conflict. International businesses are often unable and

unwilling to make a stand. As British Petroleum found out to its cost in Angola, any

company prepared to tackle vested interests in a conflict area may be threatened with

having its concessions terminated and awarded to less scrupulous competitors. Political

leadership has also been lacking as northern governments have sought to appease the

ruling elite to avoid harming national business interests.

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Although there is no single solution to these problems, it is clear that a more joined-up

international approach to the way that companies access and manage the extraction of

resources worldwide is necessary. Our work driving the Kimberley Process (to eradicate

conflict and illicit diamonds from the world diamond trade) has indicated the enormous

institutional resources and time necessary to achieve effective international controls.

The need not to reinvent the wheel every time a resource is identified in funding conflict,

and the pressing time concerns - the Kimberley Process comes after three years of

gruelling negotiations and after billions of dollars in revenues funnelled to rebel groups -

argues for a move from targeting individual countries and commodity streams towards a

cohesive framework of measures that can act in a preventative rather than reactive way

to existing problems.

Global Witness is in a unique position to drive global dialogue on such issues and to lever

the individual lessons and specific policy recommendations from its existing in-country

campaigns; to promote the creation of a flexible international policy toolkit to address the

role of natural resources in funding conflict and corruption. Such a toolkit may involve smart

sanctions, chain-of-custody monitoring, appropriate disclosure regulations and registers of

interests as well as a series of strategic legal actions to identify and sanction malfeasants

and to enshrine the rule of law and good governance in the resource sector.

At a time when it is increasingly apparent that dysfunctional states can become havens for

terrorists and money laundering, this approach is an important and long-overdue first step

in addressing these global problems, as well as strengthening governance and combating

poverty in many of the world’s poorest and least developed countries.

In organisational terms this translates into a need to increase Global Witness’ capacity. We

believe that we have the opportunity and ability to begin to address the problems of

resource extraction in a systematic and effective manner. We have assembled a team of

researchers and campaigners to extend the case studies and lessons-learnt from our

existing campaigns towards building a coherent strategy to break the link between resource

exploitation, conflict and corruption. The sheer scale of revenues being diverted away from

the citizens of countries like Angola totals tens of billions of dollars; Global Witness’ annual

budget for 2001 was US$1.8 million.

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Press coverage

“Going Underground” By John Sweeney

The Observer (London) 26 March 2000

“The people who did for Pol Pot were not forces of law and order, still less the diplomats of

the international community. They were the tree detectives of Global Witness…”

“Global Witness closed down the illegal logging trade between western Cambodia…thanks

to its detailed and accurate reporting. The KR [Khmer Rouge] slowly began to run out of

money to fund its grisly guerrilla campaign against the Phnom Penh government.”

“How a little band of London activists forced the diamond trade to confront the blood on its

hands” By Mary Braid and Stephen Castle

The Independent (London) 24 July 2000

The diamond industry is facing obliteration by consumer power similar to that which

destroyed the fur trade. Last week the $7bn-a-year global industry, apparently persuaded

that it was on the edge of the abyss, capitulated to campaigners’ demands for fundamental

changes to end the trade in stones illegally mined in African war zones and then used to

bankroll conflicts in which children lose their limbs and tens of thousands die.”

“Global Witness has highlighted the fact that wars need to be paid for, and that in poverty-

ridden but mineral-rich countries, rebels and governments fight for control of diamond fields

because that can determine who wins the war.”

“It is estimated that the stones earned UNITA $3.7bn between 1992-1997, allowing it to

rearm while it spoke of peace, and eventually to wage war again.”

“Global Witness collected evidence to convince governments, the United Nations and the

public of what was going on. And then it lobbied ferociously. At the same time it was forging

alliances with other non-governmental organisations (NGOs) working in Angola. Very quickly

a global campaign force capable of taking on a global industry emerged.”

“Angola Urged to Trace Its Revenue From Oil” By Rachel L Swarns

The New York Times 14th May 2002

“Angola is sub-Saharan Africa’s second-largest oil producer and the seventh-largest

supplier of crude oil to the United States. Yet 70 percent of the people live in poverty and

the hardships have only worsened as oil exports have surged, according to the United

Nations and advocacy group Global Witness.”

“…Global Witness says that $770 million in tax revenue is missing. It cited the Ministry of

Petroleum as saying that the government was paid $3.8 billion in taxes in 2000 while the

Finance Ministry reported that only $3 billion was received.”

“…the growing interest in Angolan oil has made some Western officials reluctant to press for

greater accountability because they fear risking access to lucrative oil contracts.”

“To Prevent Conflicts, Look to Commodities Like Diamonds” By Tina Rosenberg

The New York Times 15 July 2002

“The diamond embargo is the most successful example to date of blocking a rebel group’s

financing. In 1998, Global Witness, a British nongovernmental group, began documenting

the billions of dollars that Mr. Savimbi made from diamonds, and pushing for global controls.”

global witness

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