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Blackwater founder expands operations in Congo

Reuters | Washington DC | Updated: 13-06-2019 19:51 IST | Created: 13-06-2019 19:37 IST
Blackwater founder expands operations in Congo
Image Credit: Wikimedia

A company run by private security firm Blackwater's founder Erik Prince has registered a subsidiary in Democratic Republic of Congo with a mandate to extract minerals and timber and conduct financial operations, corporate filings show.

Prince, who renamed Blackwater and sold it in 2010 after several of its employees were indicted on unlawful killing charges in connection with their work as U.S. government contractors during the Iraq War, has run Hong Kong-based Frontier Services Group (FSG) since 2014. FSG has close ties to the state-owned Chinese investment company CITIC and provides security, aviation and logistics services to Chinese firms operating in Africa.

FSG has owned a small Congolese trucking company called Cheetah Logistics in Congo since 2015, but the new subsidiary, Frontier Services Group Congo, has a more expansive mandate, according to a filing with Congo's business registry. Among its aims are "the exploration, exploitation and commercialisation of minerals", forest logging, security, transport, construction and "all financial, investment and project financing operations, both public and private".

The filing shows Frontier Services Group Congo was registered on Aug. 20, 2018, and formally established on Nov. 13, 2018. FSG did not respond to a request for comment.

In its 2018 annual report, released in April, it listed Congo, Laos, Myanmar and Cambodia as countries it had identified for investment, in connection with China's Belt and Road global development strategy. Besides his work for FSG, Prince has been pushing a plan to deploy a private army to help topple Venezuela's socialist president, Nicolas Maduro, sources with knowledge of the effort told Reuters in April.

He has also tried unsuccessfully to convince the Trump administration to replace U.S. soldiers in Afghanistan with security contractors. FSG owns aviation companies based in Kenya and Malta and provides security training to companies in China. It says it is also active in more than a dozen countries in Asia, Africa and Europe.

Prince told the Financial Times earlier this year he was aiming to raise up to half a billion dollars through a new fund to invest in mining metals like cobalt, copper and lithium that are needed for electric car batteries. Congo accounts for roughly 60 per cent of the world's cobalt output and is Africa's largest producer of copper.

Chinese companies have snapped up valuable concessions in recent years as Western firms reduce their footprint in Congo, which is mired by armed conflict and political instability. Blackwater, which Prince founded in 1997, was contracted by the U.S. State Department to provide security during the Iraq War. In 2007, Blackwater employees shot and killed 17 Iraqi civilians in Baghdad. One of the employees involved was convicted of murder in December and three others have been convicted of manslaughter.

Blackwater agreed in 2010 to pay $42 million in fines for hundreds of violations of U.S. export rules, including making unauthorized proposals to train troops in southern Sudan. The company now operates as Virginia-based Academi.


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