Analysts question $7B China-Guinea mining deal

By KRISTA LARSON and ANITA POWELL

posted: 41 DAYS 9 HOURS AGO

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JOHANNESBURG -Reviled internationally for gunning down unarmed pro-democracy protesters last month, the military government of Guinea has gained a lifeline — thanks to a $7 billion mining deal it says it obtained with a Chinese company.

Human rights groups decried the deal while China would not confirm Tuesday's announcement by Guinea, a West African country led by Capt. Moussa "Dadis" Camara who seized power in a coup in December.

"There's a real risk that these investments could entrench and embolden and enrich an already abusive government," said Arvind Ganesan, director of Human Rights Watch's Business and Human Rights Program.

Chris Alden, an international policy expert at the London School of Economics, said Camara "apparently pulled the rabbit out of the hat for this regime."

"We're talking about a desperate captain who ran a coup, who's actively being delegitimized," Alden noted.

China's Foreign Ministry spokesman Ma Zhaoxu on Thursday refused to confirm the mining deal. "As far as we know, this is an act of an international company registered in Hong Kong," he said. However, he said that Guinea is a country of "traditional friendship" with China.

"China has been providing assistance to Guinea in economic and social programs as our ability permits...such cooperation is in line with the fundamental interests of both peoples."

The deal gives Guinea's military junta a major potential source of revenue even as it faces isolation from the international community after soldiers opened fire on Sept. 28 at demonstrators opposed to Camara running in elections planned for January.

A local human rights group said 157 protesters died while the government put the death toll at 57. Witnesses say soldiers also raped women in the streets.

Guinea announced the agreement on Tuesday, a national day of mourning for those killed by the troops at Guinea's national stadium.

"This could have been a good coup for the government but all this is botched by the slaughtering of our innocent brothers and sisters by the military," Abdoul Kadr Diallo, an engineering student at the University of Conakry, said of the Chinese deal.

The United States has called for Camara to step down, while former colonial power France has said it can no longer work with him. The African Union already had suspended Guinea's membership following the coup.

Ganesan said the mining deal's timing is "unfortunate."

"It certainly sends the wrong message at the wrong time," the rights advocate said. "After widespread abuses have taken place in Guinea, for the government to be able to tout a $7 billion deal with the China International Fund says that they are above criticism."

Guinea is the world's largest producer of bauxite, the raw material used to make aluminum, and produces diamonds and gold. Mines Minister Mahmoud Thiam said that the Chinese company "will be a strategic partner in all mining projects."

Thiam also said that new power-generating plants, railway links, and planes for both international and local air transportation are part of the deal.

U.S. State Department spokesman P.J. Crowley would not comment directly on this specific business deal, but noted the U.S. has "expressed concerns about this kind of activity. We think it's important that as you do business with countries you also have respect for human rights."

David Shinn, a former U.S. ambassador to Ethiopia and Burkina Faso and an expert on Chinese-African relations, said the timing of the announcement was strategic on Guinea's part.

"The fact that the announcement came from Guinea and not Hong Kong or China is important," he said. "I can't imagine that China would want to use this timing to announce it."

China International Fund is a Hong Kong-registered company that has previously been involved in brokering infrastructure projects in Africa, chiefly in Angola. Some of the projects have attracted controversy, stalled for unexplained reasons or fallen into dispute with subcontractors.

A receptionist at the company's Beijing office said she had no information about the reported Guinea mining contract and no one else was available to comment. A woman who answered the phone at the company's Homg Kong office declined comment and asked that questions be faxed.

Africa's trade with China reached more than $100 billion in 2008 and has multiplied by 10 since 2001, according to the African Economic Outlook. China's policy of operating on purely business terms has raised questions about whether it will hamper the progress of human rights in Africa.

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Associated Press writers Carley Petesch in Johannesburg and Robert Burns in Washington contributed to this report.

2009-10-15 06:20:59