Almost half of the purchases of crude oil from the National Hydrocarbons Corporation is controlled by only three Swiss traders according to recent information.

In a report entitled "Swiss traders, African oil and risks opacity", published July 20, the three organizations consisted of the Berne Declaration, Swiss aid and Natural Resource Governance Institute (U.S.A).

"In Cameroon, Swiss traders dominate the purchases of crude oil to the National Hydrocarbons Corporation (SNH). While market data highlights that the Spanish oil company EUB is the single largest purchaser of oil from the SNH in 2013, the Swiss trader Glencore, Vitol and Gunvor have jointly purchased nearly half of the crude oil sold by SNH. These purchases resulted in payment to the State of Cameroon, close to 600 million dollars (about 300 billion CFA francs), representing 12 per cent of state revenues," the report says.

“The case of Cameroon is used to demonstrate how oil sales in African countries may be of paramount importance for sellers in the States, while for traders, it is not much,” it continued.

To justify this argument, the report reveals in 2013, "Glencore has bought nearly 400 million dollars (about 200 billion CFA francs) of crude oil to the SNH, while turnover (volume of gross sales) of the trader the same year peaked at $233 billion, and was nine times the GDP of Cameroon in 2012."

In addition, the report again highlighted the importance of these crude oil sales to African countries. The revenues earned thanks to the four acquisition transactions with SNH by the Swiss trader Glencore in 2013 is equivalent to a third of oil and gas revenues of the country, and more than sufficient to cover the entire budget for public health in Cameroon.

An invitation to the transparency of transactions But beyond these figures, the report noted that the transactions by Swiss firms "have significant governance risks, since they occur in contexts characterized by weak institutions and endemic corruption. Despite their importance, we learn these sales escape all control and do not benefit populations concerned as they should. Trading companies also contribute to make these opaque transactions."

With this last observation, the research recommend "governments of African oil producers and public oil companies develop standards to encourage integrity in the choice of buyers and determining the selling price, including the publication of retail sales of state share of oil."

At the same time, the report continues, Switzerland is invited to "assume its responsibility as the world leader in commodity trading by adopting a regulation forcing firms in this sector to disclose all payments they make to governments and state oil companies, including payments associated with trading activity.

The Federal Council should revise its draft regulation presented on June 25, 2014, which excluded the trade." Moreover, "the governments of other trading places, including the European Union, the United States and China should also include trading activity in their legislation on the transparency of payments to governments.”