Making a Killing: How and Why Corporations Use Armed Force to Do Business Paperback - 2004

Excerpt

Introduction

We rocketed along the thin strip of pavement that passed for a highway in northeastern Angola, heading for a diamond mine located in what was, until recently, rebel-held territory. The drivers in our small convoy of cars and trucks were either extremely careless or terrified. Feet to the floor, they careened around potholes and washouts, their juddering vehicles protesting with metal shrieks and groans. We held on as best we could. At the front and back of our group were pickup trucks filled with men cradling AK-47 knock-offs. The men somehow managed to stay in place, despite being precariously seated on two rows of plastic lawn chairs lined back to back down the centre of each truck bed.

It was 1998 and Angola was at war, but we -- a motley collection of business journalists, investment analysts, potential investors and tight-lipped mystery men -- had been assured that this part of the country was peaceful, so peaceful that a number of mining companies had begun operations there. The company that had organized this investment tour, DiamondWorks Ltd., had wined and dined us the previous evening at the Sandton Hilton in Johannesburg and filled our heads with tales of giant gemstones just waiting to be plucked from the earth. This morning they had flown us on a Million Air charter jet to the Angolan capital, Luanda, and then on to Saurimo in the northeast of the country. We were now making the last leg of the journey by road, to the region near the Congo border that was famous for the quality of its diamonds.

More gun-toting men came out to greet us at the site. It was a mine in name only. Here and there, the buffalo grass had been scraped away by bulldozers to expose the iron-red earth of Africa. But the real action was on the Luo River, which ran through the property. There, miners were using a simple but effective machine to suck gravel from the riverbed and extract from it the alluvial diamonds that had travelled downstream on the current. DiamondWorks planned to divert the river from its course to enable a more thorough search.

A group of us were handed over to the care of a soft-spoken Angolan mine employee, who painted an impossibly bright picture of the area as he drove us around. Not only were there no human predators lurking nearby, there were also no crocodiles or hippopotamuses in the river and no large snakes in the bush. The investment analysts in our group nodded approvingly when told that three levels of security surrounded an iron cargo container that served as both a sorting area and a storage space for recovered gems. “Diamonds bring out the worst in people,” a DiamondWorks representative confided to us as he wrestled with the three massive padlocks on the container. “They are evil. They are the only thing in the world this small” -- he made a gesture with two fingers -- “that can pay for your family’s future.” The diamonds on the sorting tables ranged from brilliant white to dark brown. They looked like fish tank gravel.

That afternoon, we dined on lobster flown in for the occasion and on bread baked by the camp cook over an open fire. The food might have been appetizing were it not for the hordes of flies that rose when flicked away by the serving men, only to descend again. Still, the company had done its utmost to create a civilized atmosphere. And it all seemed rather peaceful until I excused myself to use the toilet facilities. Four men, one heavily armed, escorted me to a concrete cubicle in the bush. At the door, I was handed a padlock to secure it from the inside. I looked at the lock in my hand, puzzled. Why, if the area was so safe, was there so much emphasis on security?

At the end of the day we retraced our steps -- another hair-raising ride to Saurimo and then onto the Million Air flight to South Africa. It had cost DiamondWorks cdn$100,000 to organize our visit, but the company thought it was well worth it. They knew they could raise millions on the stock exchange back home if we -- journalists, analysts and money men -- reported to our various audiences that the mine was operating and secure. Which is what we did. Their methods may not have been the most sophisticated in the world, but they were finding diamonds with their giant vacuum, even if they were harvesting them behind a wall of guns.

Several months later came news that put my armed escort to the lavatory in perspective. Rebels, thought to be from the National Union for the Total Independence of Angola (UNITA), had overrun part of the DiamondWorks operation, killing eight people and dragging another ten into the bush. The rebels looted the mine, and when they were done, government forces arrived and looted it again. The hostages were still missing and presumed dead.

I had first encountered DiamondWorks and its majority shareholder, Tony Buckingham, a former Special Services officer from Britain, three years earlier while I was working as a foreign correspondent in London for the Canadian newspaper the Globe and Mail. DiamondWorks was nominally Canadian -- it was registered in the Yukon and raised money on the Vancouver Stock Exchange -- and the newspaper wanted coverage of its activities. Specifically, my editors wanted to know if the rumours linking DiamondWorks with a group of mercenaries out of South Africa called Executive Outcomes were true.

Through my investigation, I learned that Tony Buckingham had been making a practice of introducing Executive Outcomes to weak and unstable governments in need of armed support. These governments often hired the mercenaries to retake prime resource areas in their countries -- diamond mines in particular -- from rebel forces. Once these areas were back in a government’s control, mineral concessions were awarded to multinational corporations. When it was revealed that some of these corporations were associated with Buckingham, he was accused of employing armed force to acquire mineral riches, much as the imperial chartered companies had done a century before. Buckingham never talked to the media, but his spokespersons insisted that there was no connection between the introductions Buckingham had made to the governments of Angola and Sierra Leone and the subsequent arrival of DiamondWorks in those countries.


From the Hardcover edition.

Media reviews

“Bloodless accounting crimes look like child’s play when compared to the ruthless and deadly corporate practices detailed in Making A Killing…. Drohan’s grasp of her subject matter is impressive.... How she managed to get interviews with some of the dubious characters she did is a marvel. And she writes well.”
—The Globe and Mail

“[A] compelling look at a very worthy subject.”
—Toronto Star

“[A] compelling case for corporations to be held accountable for their actions, particularly when those actions are harmful to local populations.”
—Winnipeg Free Press

“The dark side of adventure capital in Africa attracts a disturbingly intriguing array of characters, and Drohan brings them to life in all their Machiavellian wonder…. the overall impact of this fine study is to challenge the global corporate powers to understand and meet global human rights and humanitarian standards.”
—The Gazette (Montreal)

“Making a Killing is a good primer for readers concerned about the human cost of the unimpeded flow of oil and diamonds to their first-world markets.”
—Quill & Quire

“As an experienced foreign correspondent and award-winning researcher, she sets the stage knowledgeably in the global context of how little meaning there is to an international order when or where corporate interests are at stake. Although the book is ostensibly about the use of mercenary armies to protect foreign investments in the governance-poor, resource-rich parts of the world, she is able to bring the larger agonies of these countries to the centre of the narrative…. compelling.
—The Vancouver Sun

“A dramatic and compelling journey into the dark heart of globalization…. essential reading for anyone interested in the effects of unfettered multinational influence.”
—Canadian Institute of International Affairs

“…Drohan’s crisp and original reporting makes its point: Whether it is Shell in Nigeria or Ranger Oil in Angola, the abuses half-way around the world hit close to home.”
—The Ottawa Citizen


From the Hardcover edition.