Foreign minister resigns over diversion of foreign aid

The foreign minister of Sao Tome and Principe has resigned after coming under widespread criticism for spending nearly US $500,000 of aid from Morocco without reference to other members of the government. Meanwhile, a group of disgruntled police officers firing guns in the air has seized the main police station in the capital to protest at unpaid salaries and poor working conditions, according to the Portuguese news agency Lusa. Ovideo Pequeno, a close ally of President Fradique de Menezes, announced his “irreversible” decision to resign on Monday. He told reporters that the controversy surrounding his actions had led to “a climate of breakdown” in relations between Menezes and the government. Defence Minister Oscar Barbosa was subsequently named caretaker Foreign Minister until parliamentary elections in March, which are expected to result in the formation of a new government. He too is a close associate of the president. Pequeno’s political future had been in the balance for the past week. Prime Minister Maria do Carmo Silveira demanded his resignation shortly after the news of his irregular conduct emerged in a press report on 31 December. However, President Menezes subsequently spoke up in Pequeno’s favour, saying that he had spent the Moroccan aid money legitimately on vehicles and other equipment for the presidency, the presidential guard and the foreign ministry. Pequeno, who had been foreign minister for the past two years, was adamant that he had not diverted any of the Moroccan cash into his own pockets. He said the money had been a direct gift from the Moroccan government to President Menezes, which he had therefore spent directly on the president’s behalf. The authorities in Rabat subsequently clarified that the intended recipient of the grant had been the Sao Tome government. Pequeno’s fate was sealed once it became clear that key foreign donors to this twin-island state in the Gulf of Guinea were reluctant to disburse further funds while uncertainty persisted over how they would be used. On Friday, France announced that it would delay signing a new 300,000 euro (US $360,000) aid agreement with Sao Tome’s cash-strapped government for several days. The government relies on around US $25 million of foreign aid each year to make ends meet. Its precarious financial position was underlined by the police protest to demand unpaid salaries and allowances. Lusa reported that a group of disgruntled officers led by Wilson Quaresma, the deputy chief of police, fired shots in the air as they occupied the main police station in the capital Sao Tome on Tuesday. Most of those involved in the protest were members of the police rapid reaction force who had recently received training in nearby Angola, it added. Lusa said army patrols had been deployed around the police headquarters, which is adjacent to the power station in the centre of the country’s sleepy capital. It quoted an official source as saying that negotiations were due to take place with government officials to try to end the standoff. In July 2003, dissatisfaction with pay and conditions persuaded Sao Tome’s small army to stage a bloodless coup in this former Portuguese colony of 140,000 people. Led by 14 former Sao Tomean mercenaries who had served in South Africa’s Buffalo Battalion during the days of apartheid, the army overthrew President Menezes while he was visiting Nigeria to discuss cooperation in exploring for offshore oil. The coup leaders caved in to international pressure and allowed Menezes to return home and resume the reins of power a week later. However, diplomatic sources in Sao Tome said they did so only after Nigeria threatened to invade the country. Political wrangling in Sao Tome over alleged irregularities in the award of five offshore exploration licences in a Joint Development Zone shared with Nigeria, has delayed the signing of production sharing contracts for these blocks for several weeks. Signing these agreements would trigger the payment of around US $55 million of front end bonuses to Sao Tome by the consortia chosen to explore the deep water acreage. The government badly needs this cash. However, many people in Sao Tome, including the attorney general and the MLSTP-PSD party that controls the government, are unhappy that the ERHC, a Nigerian-controlled company which has no experience of oil exploration and slim financial resources, has been granted a lead role in two of the five offshore blocks and a large slice of equity in the other three without having to pay a cent. President Menezes has stopped short of ordering a review of the licences awarded. But he admitted last week that the controversial terms negotiated by ERHC with the government of his predecessor mean that Sao Tome will forfeit US $58 million in front end bonuses on these contracts that it would otherwise have received.