2 minute read
10 Apr 2018
5:41 pm

French giant Total helped Congo skirt IMF rules: report


The Congolese government skirted requirements of the International Monetary Fund in 2003 through a financial fiddle created by French oil giant Total, the French daily Le Monde reported Tuesday.

Total denied the Le Monde report, saying in a statement that it "did not help the Republic of Congo escape the oversight of its international creditors"

Total denied the report, saying in a statement that it “did not help the Republic of Congo escape the oversight of its international creditors.”

Le Monde based its report on a deep dive into the trove of confidential documents published in 2016 and 2017 by the whistle-blowing International Consortium of Investigative Journalists (ICIJ) that have become known as the “Panama Papers” and “Paradise Papers”.

It said Total developed an “impenetrable offshore scheme” that enabled Congo in 2003 to sell an oil concession to Congolese firm Likouala, which Le Monde called a “front” for the Congolese government.

The arrangement allowed Brazzaville to spend cash at a time when the heavily indebted country was barred from going further into debt with oil projects, Le Monde said.

Likouala, created in September 2003, was “an empty shell without expenditures or revenues, without staff or a bank account in its name” and managed by Total, the report said.

The company, which ceased to exist in 2011, was owned by a “front company” called Montrow International Limited, registered in the British Virgin Islands, Le Monde said.

To buy the oil concession, Likouala borrowed $70 million (roughly 60 million euros at the exchange rate in late 2003) from French banking giant BNP Paribas.

Contacted by AFP, BNP Paribas said banking regulations prevented it from discussing the matter.

Total, for its part, said: “The Republic of Congo decided to monetise its interests in the Likouala field by ceding them to the Likouala SA company and asked Total for help setting up this transaction with the most reputable financial establishments.”

Its statement added: “The IMF was kept informed of the operation by the authorities of the Republic of Congo, notably with a letter dated November 17 that attests to it.”

The online statement included a link to the letter, posted on the IMF website.

Total ceded the oilfield to Congo in 2003 under an accord aimed at normalising strained ties.

Congo’s public debt represents 117 percent of its GDP, the IMF said last year.