Africa’s Newest Petro-Dynasty

Equatorial Guinea’s economic story is a study in extreme volatility. Touted at independence in 1968 as one of the most prosperous countries in Africa due to its thriving cocoa industry, its economy halved over the 1970s, then multiplied twentyfold during the oil boom of the 2000s. The boom kickstarted in 1995, when ExxonMobil’s Zafiro field turned the first drops into a flood. The regime sold itself in that decade as the ‘Kuwait of Africa’, a branding campaign aimed at the American public in the hope that a small, oil-rich family state would be received like Emirati royalty. Critics turned the nickname against Obiang, with exiles calling him the ‘Emir of Malabo’ or simply ‘the Satrap’, a reference to the ostentatious provincial governors of the Achaemenid Empire. The numbers briefly sustained the fantasy—at $20,582 in GDP per capita, the twentyfold rise in GDP between 2000 and 2013 made Equatorial Guinea Africa’s richest country on a per capita basis—until the 2014 price collapse tipped it into a decade-long economic recession.

Twice, then, a price shock born in the Middle East has marked a change of reign in Malabo. As the octogenarian President Obiang prepares to hand power to his son—Vice-President Teodoro Nguema Obiang Mangue, the notorious scion and bon vivant known universally as Teodorín—it is tempting to ask whether the ongoing ripple from the war in West Asia, or the Middle East, will strengthen or finally end Africa’s longest-ruling regime. Analysts have long wagered that dwindling oil reserves and low prices would force instability, or at least a reform away from Nguemismo. However, the opposite is more likely: a liquefied natural gas boom is bankrolling the dynasty’s third act and Washington, which once prosecuted Teodorín for corruption, embezzlement and money laundering, decided to underwrite it under a settlement agreement with the Department of Justice. The United States had shunned the regime after the 2004 Riggs Bank scandal, which exposed Equatorial Guinea as the Washington-based bank’s largest single client. Under the Barack Obama administration, the US Department of Justice’s Kleptocracy Asset Recovery Initiative seized Teodorín’s Malibu mansion, a Ferrari and Michael Jackson memorabilia—unprecedented in targeting the son of a sitting head of state. Now, with the spectre of Chinese naval ambitions in the Atlantic, the same establishment has its rationale for turning a prosecuted regime into a quiet partner...