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Longer, analytical article.  Corruption pre-requisite for government contracts

Summary & Comment: "The head of the Angolan state oil company and the country’s ambassador to France have entered into a multi-billion euro partnership with the French defence company Thales to supply communications equipment to the Angolan military, despite Angolan legislation that appears to prohibit the two officials’ participation in the deal. Western commercial diplomacy , especially French, continues to play an important and aggressive role in legitimising the lack of distinction between public duties and private interests, in the country, which have resulted in the de facto privatisation of the sovereign tasks of the State. The Thales/ Sadissa joint-venture reveals the easiness with which Western multinationals promote corruption in Angola, as a pre-requisite for entering into business deals with the government." Marques is a long time penetrating and courageous investigative reporter of exploitation by Angolan government and parastatal officials doubling as private enterpreneurs. JK

Author: Rafael Marques de Morais Date Written: 24 September 2009
Primary Category: Angola Document Origin: author
Secondary Category: Resource Extraction Source URL: http://www.africafiles.org
Key Words: Angola, arms deal, Thales, Sadissa , corruption, government officials

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Printable Version

Corruption as pre-requisite for government contracts 
 -
Legal doubts over Thales’ Angola deal

www.africafiles.org/article.asp?ID=21869

The head of the Angolan state oil company and the country’s ambassador to France have entered into a multi-billion euro partnership with the French defence company Thales to supply communications equipment to the Angolan military, despite Angolan legislation that appears to prohibit the two officials’ participation in the deal.

In January 2009, the Council of Ministers of Angola awarded two contracts, worth a total of 141,6 million Euros, to a joint venture between the Thales Group and an inexperienced Angolan company, Sadissa, for the supply of a new system of communications to the Angolan Armed Forces (FAA). Thales was previously implicated in the corruption case that lead to the conviction in 2005 of Schabir Shaik, on charges that included soliciting a bribe from Thales on behalf of the then South African Deputy President, and now President, Jacob Zuma.

The Angolan contracts, with the official references 38/DM/03/SST/08 and 39/DEM03/SST/08, were undersigned on behalf of the army by Simportex, a private company owned by the FAA which is responsible for importing material for the armed forces. The contracts raise serious legal and ethical concerns. Sadissa was founded on April 1 2003 by Manuel Vicente, CEO of the Angolan oil company Sonangol, and the current Angolan ambassador to France, Miguel da Costa. Sadissa was set up to undertake a range of business interests including general trading, telecommunications, consulting, tourism, and travel.

Vicente and Da Costa co-own Sadissa and both sit on its board. The other minor partners in the company are the ambassador’s son, Wilson Miguel da Costa; Anabela Chissende who represents her husband, General Adriano Makevela Mackenzie, the head of military training at the joint chiefs of staff of FAA; and Catarina Marques Pereira, who represents the Angolan state’s shareholding position at Luó- Sociedade Mineira do Camatchia-Camagico as its deputy-chairman of the board of directors. The director of the Angolan Armed Forces’ company, Simportex, General João Pedro Cavunga, said of the deal: "We are a military company, and as such we are not allowed to disclose information of military nature."

In a telephone conversation to clarify the nature of the relationship between the French multinational and the Angolan officials, the press assistant of the Thales Group, Marjorie Lauger, said she had "no idea about the issue." She took notes on the author’s contact details as well as questions on the direct negotiations with Ambassador Miguel da Costa, to forward it to the head of the press office. Marjorie Lauger promised that her boss would return the call with answers, but this never happened.

According to the CEO of Sadissa, José Alberto Puna Zau, Thales sells pieces of equipment to the FAA, while the Angolan side installs them and provides for their maintenance. Puna Zau, who is a former minister of Public Works, stressed the difficulties in gaining the approval of the deal by the Council of Ministers, since a sector of the government opposed it. The CEO of Sadissa explained how he had to engage before with key government officials to win their support to secure the contract. "I had to speak to the ministers of Defence, Interior and War Veterans. It was on the intervention of the Minister of Defence, Kundi Payhama, [at a session of the Council of Ministers] that the President [of the Republic] gave orders for us [Thales/ Sadissa] to be left in peace", he said.

The conflation of public duties and private interests of Sadissa’s co-owners contravenes the Angolan legal system. In the case of Sonangol’s CEO, Manuel Vicente, the Law n° 10/89, on the Disciplinary Regime of the Public Manager, prohibits the engagement of a manager of a public company in "the undertaking of other duties that involve the representation of private interests, of self or on behalf of others in the management of any other company." Angolan Law n° 21/90, known as the Law on the Crimes Committed by High Office Holders, forbids government officials to profit from business contracts with the state, for personal gains. As an ambassador, Miguel da Costa, who has maintained high level contacts with Thales on the deal, falls under this law.

However, Puna Zau defended the formation of Sadissa, which became operational in 2006, as a philanthropic initiative of its co-owners. He stressed that "this project [Sadissa] is a kind of a NGO to help the comrade freedom fighters. Many of these elder freedom fighters were living in squalor and abandoned", said the manager who claimed that his company has already identified 20 war veterans who will reap benefits from the company.

The Deal

According to a statement issued by the government at the time, the contracts aim at the acquisition of a tactical system of communications to strengthen the army’s co-ordination of troops, as part of the process of restructuring the FAA. The government also stated, in the same document, that the contract would enable the setting up of a "central infrastructure of communications to be shared by all the defence and security agencies, in the country, for greater reliability and security."

A press release by the Thales Group, dated April 9 2009, announced the signature of the contract with the FAA for the supply of "an innovative Mobile Radio Communication Network", and stressed that it will be operational "for the occasion of the 2010 African Cup of Nations" to be held in Angola in January. The document omitted any reference to Thales’ joint bid with Sadissa, and only indicated that the communications network, to be managed by FAA, will be shared by four Angolan agencies. The Thales Group, which operates in more than 50 countries, is a "global technology leader for the aerospace, space, defence, security and transportation markets", according to its website, partly controlled by the French State and the French Dassault Aviation, which hold 27% e 26% of the shares, respectively.

Commentary

Corruption as a Business Institution

The promiscuity between public service and private interests in Angola has enshrined conflicts of interest, influence peddling as well as other acts of corruption while eliminating the grounds for an ethical public administration in the country. Such promiscuity also hinders any possibility for the establishment of a market economy in the country, based on competition. The ruling class monopolises the market through double-dealings in their capacity as both the top agents of the State, and the businesspeople with privileged access to State contracts, to further their private business interests as agents for foreign enterprises in the country.

Thus, the government and the National Assembly have undertaken legislative measures to throw out a number of legal dispositions, which clarity and rigorousness could most effectively tackle high-level corruption at the courts of law. By way of illustration, the National Assembly passed the Law n° 13/03, Derogatory of the Law of Infractions against the Economy (Law 6/99), which eliminated the Articles 48 and 49 that severely defined passive and active corruption as well as the Article 50, which broadened the criminalisation of kickbacks taken by public officials for private benefit.

Another evidence of the efforts to prevent the institutional tackling of corruption is the authorities’ unwillingness to establish the High Authority against Corruption, which law was passed in 1995. This law was established to deal particularly with the "actions and omissions undertaken by agents of the State against public property, and those stemming from abuse of power or any other which undermines public interest or the morality of the State administration (...) including the actions committed by bearers of high office (...)." Also, according to a magistrate who spoke on the condition of anonymity, the National Assembly has been ignoring the insistent written pleas by judges proceed with urgent legal reforms to end with impunity in high offices, which strives on the pretext of insufficient legal mechanisms to combat corruption and abuse of power.

Furthermore, the Thales/ Sadissa joint-venture reveals the easiness with which Western multinationals promote corruption in Angola, as a pre-requisite for entering into business deals with the government. France has been an important international stage for the corruption of the highest ranking officers in Angola, especially through the well-known political scandal Angolagate, in which the central figure, the French arms trade dealer Pierre Falcone, has close ties with the Angolan president José Eduardo dos Santos.

Also, the Western commercial diplomacy has been playing an important and aggressive role in legitimising the lack of distinction between public duties and private interests, in the country, which have resulted in the de facto privatisation of the sovereign tasks of the State. For instance, on her recent visit to Angola, the US Secretary of State, Hillary Clinton, publicly defended the Angolan government as being committed to greater transparency, in the governance of the country. She showcased the government’s inconsequent publishing of numbers on oil revenues, on the website of the Ministry of Finances, as sound evidence of such a commitment.

Printable Version

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