• Amount of Ex-Im financing:  over $150 million
• Corporate beneficiaries:  Halliburton Energy Services, Solar Turbines, Brown & Root
• Associated problems: war, corruption, human rights violations

The Export-Import Bank of the U.S. (Ex-Im) from 1996 through 1999 extended over $150 million in financing to US oil and oil service companies operating in Angola, whose autocratic government devotes its oil earnings to wage an unpopular civil war, and pockets most of what is left over, diplomats, human rights observers and security analysts say.[i]  With oil production at about 1 million barrels per day, oil revenues comprise 80 percent of government currency, or approximately $3 billion a year.[ii] 

The 26-year civil war between the MPLA, which controls the government and the rich offshore oil fields, and UNITA, which controls parts of the countryside and the diamond-producing areas, has completely impoverished the country, with both sides responsible for mass human rights atrocities.   What was once a food-exporting country has become chronically dependent on foreign aid. Fighting in Angola has resulted in a population displacement of 2.5 million people. [iii]  According to the United Nations Children’s Fund, Angola is the most difficult place on earth to be a child.[iv] Indeed, Angola has one of the worst records in terms of child soldier conscription in the world, with foreign oil and mining companies often knowingly using children as armed guards to protect their property, according to Human Rights Watch.[v]

In order to finance the war against UNITA, the Angolan government has been selling oil concessions to multinational corporations at a low price, and, in turn, oil companies have been pouring billions of dollars into Angola.  The ability of international oil companies to remain outside the conflict or the corruptive practices of the governing elite is dubious at best.  In order to operate in the country, oil companies must create a joint venture with SONANGOL, the government-owned company, or opt for a production-sharing agreement as a contractor for SONANGOL.[vi]  Numerous cases of oil company engagement in vast arms deals, corruption, and human rights abuses have been documented by independent observers, the most well-known of which involves Elf and Jean-Christophe Mitterrand, son of the former French president.[vii] 

Into such an environment, U.S. Ex-Im Bank put forward, in one case, a $64 million credit to Halliburton Energy Services, to back oil field development in Cabinda. U.S. diplomats in Angola worked aggressively to help Halliburton secure the contract, according to State Department documents released last October.   Vice President Dick Cheney, the CEO of Halliburton at the time, is alleged to have used his connections as former Defense Secretary to secure the company contract.[viii]  Government officials boasted in a cable to Secretary of State Madeleine Albright in 1998 that they had “literally camped out” at a local government, banking and oil-industry offices, “unraveling snag after snag to obtain the transfer of funds,” on behalf of Halliburton.[ix]  Halliburton received an $87 million credit and nearly $90 million in guarantees for its operations in Angola. [x] 

In a press release, Ex-Im acknowledged that engaging in a financial transaction with the Angolan government is precarious, stating that “use of a secured offshore escrow account allowed Ex-Im Bank to support the deal even though the Bank is not open for routine transactions in Angola.”[xi] 

As the main generators of revenue to the government of Angola, Ex-Im Bank together with the international oil industry and other lending banks are at the very least complicit in the current situation.  More precisely, given that Ex-Im financing provides the financial cover without which private investment would often not occur, its support for the projects could be said to be in direct support of child soldier conscription and other misdeeds perpetrated by the Angolan regime.  In effect, Ex-Im has put profits ahead of the lives of Angola’s people. 

The human rights and corruption implications of these loans demonstrate the need for Ex-Im Bank to engage in a thorough human rights screening of its projects.  Any country where human rights violations are commonplace should be off limits for Ex-Im Bank financing. An ombudsman’s office would also provide independent oversight of Ex-Im projects, ensuring that, once approved, any human rights or environmental violations were brought to the Bank’s attention, and appropriate action taken.  Taxpayer money should not underwrite the degradation of human rights.

Back to the top
Back to Case Studies list