Title: Rainforest plundered by Murdoch's ex son-in-law
Fortune-hunting businessman has struck lucrative deal with Mugabe. Jason Burke and Antony Barnett reportDated: January 2002
He was the ambitious son-in-law of media mogul Rupert Murdoch. Elkin Pianim's marriage to Elisabeth Murdoch helped him to establish contacts with businessmen and politicians worldwide.
When he separated from his wife in 1998, Pianim continued to build his business empire, having made money from selling two American TV stations. He launched Britain's New Nation newspaper, aimed at black readers, which failed to achieve financial success.
Now Pianim has struck up a highly controversial partnership with President Robert Mugabe's Zimbabwean regime in which both sides stand to make millions selling precious tropical hardwoods plundered from rain forest in the Democratic Republic of Congo (DRC).
An Observer investigation has established that a firm run by Pianim from London has links with Mugabe and his Zanu-PF party. It has long been suspected that Mugabe has profited from ventures with UK-based businesses, but this is the first time hard evidence has emerged.
Investigators in Britain, southern Africa and the US have recently launched a major effort to track assets held by the Zimbabwean president and his closest allies. They believe that Mugabe and senior Zanu-PF figures, who are facing international sanctions for human rights abuses, have made fortunes through their political positions and have invested widely overseas. There is no suggestion that Pianim is in any way connected with such investments or is involved with any illegal activity.
The Observer has traced a complex web of companies in London, the Isle of Man, Zimbabwe and the DRC that have been set up to exploit natural resources, including diamonds and timber, in the war-ravaged central African state. The DRC conflict has cost an estimated three million lives.
By logging one of the planet's most important rainforests, Pianim, 32, hopes to make a fortune. For Mugabe and his political allies, who have been given the logging concession in exchange for military support for the Congolese government in their battle against rebels, the operation will be just as lucrative. It will help swell the war chest of the Zanu-PF, which has led the recent violent crackdown on Zimbabwe's growing democratic opposition.
In July last year Pianim formed a joint venture, SAB Congo, with a company called Socebo, part-owned by senior figures in the Zanu-PF and Zimbabwean military.
The deal was simple: SAB-Congo would cut down thousands of irreplaceable hardwood trees, such as teak and mahogany, from the Katanga region of the Congolese rainforest. The trees would be converted into planks and exported by road and rail to ports in South Africa and Tanzania. From there they would be sold to buyers across the globe.
SAB-Congo's sales arm is a British firm run by Pianim called African Hardwood Marketing.
Its offices are located at his Notting Hill home in west London. His 60 per cent stake in SAB-Congo has been channelled through a company registered in the Isle of Man called Western Hemisphere Capital Management. It has an office in Harare, the Zimbabwean capital, employing up to 50 people.
In November the UN published a report on the 'exploitation of natural resources in the DRC'. It concluded that Zimbabwe's armed forces have made huge sums from exploiting timber, copper, diamonds and other natural resources.
Pianim told The Observer yesterday that a second Isle of Man-registered company, Western Hemisphere Resources, formed a diamond mining venture with another part of the Mugabe regime's business empire - a company called Cosleg.
According to the UN, Cosleg has made senior members of the Zimbabwean military extremely rich through its activities in the DRC.
Environmentalists are horrified by the logging of hardwoods in DRC's tropical rainforests. They fear the effect of such a huge operation will be devastating. Congo has nearly half of Africa's, and 6 per cent of the world's, tropical rainforest. Until recently poor communications and the conflict had largely spared the area from the attention of commercial tropical timber firms.
'The long-term impact on local people's livelihoods and on rare wildlife such as the gorilla will be devastating,' Patrick Alley, director of the human rights and environmental campaign group Global Witness, said. 'This is forest the world can ill afford to lose. There is no way that this is sustainable. It risks the whole environmental and economic future of the Congo.'
Last week Pianim played down the role of the Zanu-PF in his joint venture and denied his company was causing environmental damage.
'We have not spoken to a single Zanu-PF or Zimbabwean military official in all of our dealings,' he said. 'We just deal with companies.'
But he did not deny that Mugabe would benefit from the logging operation in the Congo or that Zanu-PF had directors on the board of his joint venture partner, Socebo. 'Given the affiliation with the Zimbabwean government, it would make sense if there were Zanu-PF directors on the board of Socebo,' he said.
Pianim, who studied Marxist economics at Vassar College in New York, where he met Elisabeth Murdoch, defended Mugabe's government.
'I wouldn't do business with a regime like Mugabe's if it was the regime which was being portrayed in the Western media,' he said. 'I grew up in Ghana under a regime that was the most murderous and thieving on the African continent. I know how these people work and what it is to live under them and wouldn't want to contribute to that kind of regime.'
Pianim, whose father spent 10 years as a political prisoner in Ghana, also defended his company's environmental record. He said: 'We have a corporate reputation and it is in our best interests to log in the most environmentally friendly manner possible.'