BY JIM ROGERS
 
Oil and Diamonds in Angola

 In Cabinda, a district of Angola in central Africa, my wife and I were surrounded by war. To the south in Angola, a 25-year civil war was raging on. To the East, fighting had broken out in the Democratic Republic, formerly known as Zaire. North of us, the border between Gabon and the Congo had been closed along the shore. Even right under our noses, in parts of Cabinda, a separatist movement was brewing; three people had been kidnapped only days before we arrived. A boat that could take us around the fighting wouldn't arrive for weeks. We were trapped.

Fortunately, money buys just about anything these days. It bought my wife Paige and me our escape in Cabinda. We happened upon a Russian cargo plane manned by Angolan soldiers at the airport in Cabinda. After some negotiation, the Angolan general agreed to fly us to Luanda for $1,200. Not a bad price for us and our cars. Certainly a lot cheaper than dying.

Civil wars. Sectarian violence. Border disputes. Separatist movements. The wars that plague Africa take on many different shapes and forms. Of all the fears that plagued me for months before arriving here, none worried me as much as how my wife and I would manage to pass safely through Africa's many battle zones. Secretly, I hoped that some of the problems would resolve themselves before we arrived. Political situations in Africa often change like the weather and I hoped my fears would end up being unfounded.

No such luck. It is now clear to me that many of the conflicts being waged in Africa aren't getting any better, and some are getting worse. Many of these contemporary battles trace their origins to the arbitrary boundaries created by Europeans over one hundred years ago. When borders between nations are established without any thought to linguistic, ethnic, or religious difference, conflicts are often a predictable result. We'd heard about the tension between Christians and Muslims in the Sudan. We'd seen the growing antagonism between the French and English populations in Cameroon.

But what struck me most as we passed through some of the more hostile territory in central Africa is how little ideology still plays a part in many of the continent's wars and disputes. Many of the battles are focused around the very thing Africa has going for itself: its natural resources. In the Republic of the Congo, a war is brewing over the country's oil assets. In the Democratic Republic of Congo, once Zaire, the battle surrounds the control of a variety of assets including gold, diamonds, and timber. But perhaps no place is this more evident than Angola.

Angola, a large country by African standards --roughly twice the size of Texas -- sits on the Western coast of central Africa. Originally a Portuguese colony, Angola gained its independence in 1975, but there has been anything but peace since then. Right from the start there has been fighting between various factions and rebel groups. At the forefront of these battles was the one between the Popular Movement for the Liberation of Angola (MPLA), which quickly took control of the country when the Portuguese withdrew in 1975, and the National Union for Total Independence of Angola, better known as UNITA.

Once it was a tug of war between the ideals behind socialism and democracy, between the forces of communism and capitalism. But what started out with ideological roots has since evolved into a battle for control over Angola two most valuable assets: diamonds and oil.

Why diamonds and oil? Initially, these two rival groups were subsidized by larger Western powers like Russia and South Africa and even our own U.S. When the Cold War ended and the Berlin Wall fell, the foreign money that had been fueling the war started to dry up. Apartheid ended, communism fell, and the U.S. stopped funneling money into the bloody massacre that was going on there.

I've heard that anywhere from 500,000 to a million people have been slaughtered in the course of the war. Now both sides have turned to the country's valuable reserves to finance their war.

The battle lines have been drawn between the cities and the valuable offshore oil wells, controlled by the government and President Eduardo dos Santos and the countryside, particularly in the Northeast, rich with diamond mines where rebel leader Jonas Savimbi's UNITA has staked his claim. Both sides are firmly entrenched with armies of soldiers behind them. Using the profits of the sale of diamonds and oil, both sides buy tanks and weapons and aircraft to keep the war going.

Oil and diamonds, after all, are lucrative industries in Angola. Angola, including Cabinda, pumps around 750,000 barrels a day and that number is expected to double in the future. In fact, Angola should pass Nigeria as the leading producer of oil in Africa fairly soon. Angola supplies the U.S. with about seven percent of its imported oil. Major international oil firms have established offshore refineries, particularly as experts guess that this region could be even more lucrative than Europe's North Sea.

The diamond industry is almost as lucrative, generating somewhere between $250 and $700 million annually. I've read that only 15 percent of the world's diamonds are gem-quality. In Angola, that number is closer to 80 percent. UNITA controls roughly two-thirds of the mining and production, particularly in the diamond-rich Northeast regions of Lunde Norte and Lunde Sul. While the U.N. has been setting embargoes against UNITA diamonds, the rebels have found ways to launder the gems, selling the diamonds through foreign countries like Togo, Liberia, and Sierra Leone. Foreign governments can try to impose restraints, but as I have always said: As long as there's a market, someone will be willing to pay for a product, illegal or not.

The biggest losers in this war are the Angolan citizens, most who live below the poverty line. The larger cities along the coast like Lobito and Namibe are overcrowded with civilians forced out of the countryside by the war. Prior to the war, Lobito's population was 20,000. Today it is 120,000. Luanda has grown from under one million people to over four million. Since everything must be imported, prices on ordinary products are ridiculously high. A single aspirin on the black market in Luanda costs at least a dollar. During periods in the 1990s, inflation topped 3,000 percent.

Disease and death are ever present. On average, each family has at least one member dying of hunger. The average life expectancy of an Angolan is roughly 48 years old. I met a Portuguese doctor in Cabinda who told me that 90 percent of the patients he treats are HIV-positive. The problem is that when he tells them that they are infected, no one believes him. They all think that AIDS is something drummed up by the West to condemn Africa. War creates not only death, but ignorance as well.

The only people profiting from the war are the leaders on both sides of the battle lines. Sonangol, the oil company owned by the Angolan government, is expected to bring close to $1 billion into the government coffers. Of course, little accounting is done to track that money and my guess is that as much of it goes to line the pockets of those in charge as it does to buy more weapons for the war. I was approached by UNITA soldiers in Namibia who were interested in buying my cars for themselves. "Come see the latest shipment of diamonds," they urged one morning. These kind of people have no interest in seeing Angola thrive; they are only concerned with their own wealth and with surrounding themselves with luxury goods. I agreed to meet them and then got in my car and drove away from the city  as quickly as I could. These were not the kind of men with whom I wanted to do business.

In the past there have attempts to end the war. In 1992, elections were held, and the government leader, Eduardo dos Santos was elected president. The rebel leader, Jonas Savimbi was supposed to become vice-president but the mercurial Savimbi rejected the results of the election and the war resumed. A second peace agreement was adopted in 1994 and lasted four years, but fighting ultimately broke out again as the two sides could not resolve their differences.

And why would they want to? War, after all, is the engine that keeps the profit making machines running for them. Peace meant sharing the wealth, something neither side wants to do. It's almost as if Microsoft and Oracle had gone to war, except the losses come in the form of the lives of innocent Angolans.

In the end, there may be too many vested interests for Angola ever to have true peace. It's a shame, too. Angola could be one of the richest countries in Africa if not the world. Prior to the war, agriculture thrived, as the country is rich in bananas, sugarcane and timber. It was the largest exporter of coffee in Africa, and the fourth largest in the world. Now, there's more than one landmine for everyone of the 11 million people that live there and farming is impossible. Angola imports all of its coffee.

As we left Angola and entered Nambia, we met a Portuguese gentlemen named Nito who had come to Angola in 1990 when peace talks were in the works. Like so many other we met, Nito had grand hopes for the fortune he could make in Angola. And given the right circumstances, he probably could have. For now, Nito had a little shop in Lubango and he drove once a week to Namibia to get supplies. "That's my life," he told me. "I drive 300 miles every week over horrible roads in a war zone to get supplies and change money."

I asked him why he didn't just leave the country. Nito shrugged and went about his business. At the border, we noticed that the guards at the border paid far more attention to Nito in his beat up Isuzu pick-up truck than they did to us. And then it struck me: Nito was probably a smuggler, bringing diamonds across the border and then selling them in Namibia. He had managed to find his own way to turn the war into a business for himself. In such a war of guerilla capitalism, it was hardly a surprise.