Diamonds for Bullets, Oil for Arms: ''Shadow State'' and Private Security Companies in Angola.

Introduction 
- 1 - 
 
INTRODUCTION 
 
 
 
“Es verdad que si hay un peligro capaz 
de hacer estallar este sistema, 
es la pobreza y las diferencias enormes 
entre pobres y ricos que ha generado.” 
Michael Camdessus 
 
 
“Historia se repetit,” said Giambattista Vico. Or, better, “Sometimes they 
come back” (even though they have never disappeared). The privatization of security 
is back to the fore, and it is challenging one of the distinguishing features of what 
scholars usually call the modern state. After the Peace of Westphalia (1648), hired 
armies were gradually substituted by citizen armies, for the state emerged as the 
repository of external sovereignty. It was especially after the French Revolution and 
the Napoleonic wars (1979-1815) that state armies asserted themselves, and the use 
of force thus began to be considered one of the main legitimate features of the 
national state. As Max Weber
1
 stated,  
 
“a state is a human community that (successfully) claims 
the monopoly of the legitimate use of physical force within a 
given territory. [...] Specifically, at the present time, the right to 
use physical force is ascribed to other institutions or to 
individuals only to the extent to which the state permits it. The 
state is considered the sole source of the 'right' to use violence” 
(Weber 1919). 
                                                           
1
 Karl Emil Maximilian “Max” Weber (1864-1920) was a German sociologist and political economist. He is 
one of the principal architects of modern social science and among the founders of the liberal German 
Democratic Party after the First World War.
Introduction 
- 2 - 
However, mercenarism and the use of private force by the state are as old as 
warfare itself, and they have characterized the course of history. It is not the purpose 
of this thesis to go back thoroughly through the history of mercenaries, but it is 
evident that the “contemporary organization of global violence is neither timeless 
nor natural” (Thomson 1996). 
Today, private security guards are central actors again, even though under new 
labels and with other organizational features. As Taulbee
2
 affirms (2002),  
 
“the sudden high profile of private companies that 
provide defence [and security] services does not signal an 
innovative departure from past practice. [It is] the number of 
companies, the scope of services offered and the visibility of 
their operations, not the novelty of the phenomenon, [that] 
mark the current era as significantly different” (Taulbee 2002). 
 
During the Cold War era, the Private Military and Security Companies 
(PMSCs) appeared on the world stage as prominent actors. They mostly originated in 
the United States and in the United Kingdom (Ortiz 2010). Probably, the forerunner 
of contemporary companies was a British firm, Watchguard International Ltd
3
. 
However, the world witnessed the triumph of the new surge of the privatisation of 
violence after the Fall of the Berlin Wall (November 1989) and the end of the Cold 
War. These events constituted a turning point in the 20
th
 century, and, in the wake of 
globalization, contributed to the reaffirmation of private military and security 
companies, which have been partially re-legitimized, structuring themselves like 
corporate business entities, often linked to other firms and part of broader 
multinational corporations (Singer 2007). 
Debates have soon arisen over the different impact of Private Security 
Companies (PSCs) on the North and on the South and their implications on internal 
and external governance and on human rights regimes. In countries that still find 
themselves at an initial or intermediate state building process, the ruling élites have 
imposed privatization and outsourcing policies without considering the peculiar 
                                                           
2
 James Larry Taulbee is Associate Professor of Political Science at Emory University, Atlanta. 
3
 Private military company registered in Jersey in 1965 by the British Special Air Service (SAS) veterans 
David Stirling and John Woodhouse.
Introduction 
- 3 - 
structural conditions. This is particularly true in the African continent. According to 
some scholars (e.g. Musah and Fayemi), the connections of security companies to 
arms manufacturers, mineral companies and Africa’s authoritarian governments and 
warlords sustain the militarization of continent, threatening to undermine state 
control and democracy (Avant 2005). Other researchers argue that if PSCs operating 
in weak states are linked with broader corporate clients, the result can be a form of 
“corporate imperialism” or “the multinational neo-colonialism of the 21
st
 century”, 
when multinational corporations’ interests are not in line with those of the 
government and the local society (Singer 2007). To other scholars (e.g. Shearer), 
PSCs in Africa can help finding solutions to intractable security problems in 
accordance with national interests and internationally shared values (Avant 2005).  
In this thesis, I have chosen to focus on the African continent because I would 
like to discover if there is a causal connection among the weak and shadow 
governments which rule many African countries, their historical, political and 
economic features, the international environment and the privatization of security. 
I have decided to analyze Angola, which is considered a failed or failing state, 
even though it is “successful” from many points of view. It is a fragile state and a 
LHD (low human development) country, as defined by the United Nations. The case 
of Angola is particularly interesting because private security guards have long been 
used there and have provided the most varied services, participating in active combat 
as well. Moreover, they have been recruited by both public and private entities, and 
the phenomenon has assumed new worrying facets in the course of time. While 
foreign PSCs were initially hired, later on domestic companies have emerged, and 
members of the political and military élites have increasingly got shares and taken up 
leading positions within these very same companies. All this casts a shadow over the 
private security industry, which appears to be more and more an instrument at the 
disposal of the ruling class to increase its political and economic power.  
The aim of this thesis is to underline how the privatization of security (and, 
specifically, the emergence of Private Security Companies) in Angola, as in similar 
countries (i.e. weak shadow states, rich in and highly dependent on valuable natural 
resources) is not a separate dynamic with no influence on internal governance and on 
the social conditions of the country. On the contrary, PSCs are a factor that 
contributes to the weakening of state institutions, the widening of social inequalities
Introduction 
- 4 - 
and the deterioration of respect for human rights. They thus strengthen the vicious 
circle of corruption, economic power and political interference that characterizes that 
kind of countries.  
This thesis focuses on the internal dimension of the private security industry; 
therefore the findings are country-specific. Further research is needed to understand 
the involvement of the industry in conflicts, peacekeeping missions and humanitarian 
assistance, for example.  
With regard to sources, I rely primarily on secondary sources, as the subject is 
sensitive, and it is not easy to find updated and reliable information on the web. 
Furthermore, the country has been at peace only since 2002, and many data of the 
previous period cannot be found or are not accurate. Secondary sources are not 
updated as well, because the subject is quite new in the academic realm. I also use 
data collected by international organizations (e.g. World Bank - WB, OECD) and by 
non-governmental organizations (e.g. Human Rights Watch), and information from 
local and international newspapers. As for the part on Private Security Companies in 
Angola, I mainly rely on research by Swiss Peace and by the Angolan journalist and 
human rights activist Rafael Marques de Morais, as on information by local people.  
 
 
Structure of the thesis 
The thesis starts with a thoroughly analysis of Reno’s conception of shadow 
state and of other related concepts (e.g. corruption, neo-patrimonialism). Then it 
goes on trying to verify whether the notion of shadow state fits Angola or not, and 
whether the privatization of security and the emergence of Private Security 
Companies in such country fall within this picture.  
In the first chapter, I explain some fundamental concepts related to security 
and then introduce the concept of shadow state to understand the context within 
which the privatization of security has developed in Africa. I adopt Reno
4
’s 
definition, which is based on the relationship between private power, commerce and 
state institutions in weak states. I explain some terms, such as corruption, neo-
patrimonialism and spoils politics, as they are useful to better understand the features 
                                                           
4
 William Reno is Associate Professor and Director of Graduate Studies PhD, University of Wisconsin, 
Madison. He is a specialist in African politics and the politics of "collapsing states."
Introduction 
- 5 - 
of shadow states. Shadow statism has emerged in Africa in the 20
th
 century especially 
in countries abundant in valuable natural resources (e.g. oil, diamonds) and heavily 
dependent on them as a fundamental source of income (rentier states). The political 
class can thus be less accountable to its population, and corruption and social 
inequality are further exacerbated. In the realm of security, this intricate relationship 
between mineral exploitation, corruption and social polarisation has the apartheid of 
security as a result. This is a paramount feature of the African continent.  
The second chapter investigates Private Security Companies, which I consider 
part of the strategy of shadow state rulers to reiterate their political and economic 
control over the country. I will briefly introduce the principal limits of present 
regulation of the private security industry and discuss the main causes for its 
emergence, particularly from the 1990s. The phenomenon of Private Security 
Companies has in fact emerged as an important feature in weak states in the 
aftermath of the Cold War. I analyze the specific conditions of the African continent, 
which possesses some geo-political factors that further contributed to a consistent 
process of security privatization. I also briefly consider the conditions of police and 
military forces as bolstering factors of the reliance on Private Security Companies. In 
the final part of the chapter, the main effects of PSCs on governance and on social 
conditions have been introduced, since they have been cause of particular concern in 
the academic realm. In contexts of distorted public governance, dominated by 
shadow institutions, and abundance of valuable natural resources, a sort of triangle 
has arisen, with Private Security Companies, local governments and multinational 
corporations as vertices. I challenge the hypothesis of some scholars who talk about 
a new form of imperialism, dominated by economic interests, or colonialism by 
invitation. Later on, I discuss some concepts which have been introduced to describe 
the novel networks of governance emerged as a consequences of the appearance of 
new actors in the security realm, these networks including both private and public 
actors. The concepts are those of Multilayered Governance, Networked Security 
Governance and Neo-Medievalism. 
Chapter III is an introduction to the case study country, i.e. Angola. I briefly 
introduce some of the main historical, economic and social features of the country, 
in order to help understand the causes of the paradoxes which afflict it. Angola is in 
fact a nation so richly endowed with natural resources, but at the same time suffering
Introduction 
- 6 - 
from lethal self-inflicted wounds. Its development has been hindered by centuries of 
slave trade, decades of bloody wars, and self-oriented élites. The result is that the 
country presents features of rentier and shadow states, which constitute a major 
obstacle to its state-building and sharpen social imbalances and discriminations. Its 
main sources of income (i.e. oil and diamonds) are at the same time the principal 
path for self-enrichment of the ruling class and the chief causes of poor quality of life 
and social polarisation. 
The last chapter focuses on the rise and diffusion of Private Security 
Companies in Angola, which was one of the first countries in the early 1990s where 
the phenomenon was observed. The history of these companies shows that they 
have long coexisted with public and paramilitary armed forces. It was in the wake of 
Cold War’s end, however, that PSCs have assumed new importance on the Angolan 
panorama, and they have been increasingly recruited by foreign investors and by the 
government. This had a new impact on governance and has led to the establishment 
of parallel structures of power which have deteriorated the prospects for democracy 
and effective state-building. In this final chapter, I show how two main phases can be 
identified in the history of PSCs in Angola, the first one characterised by foreign 
companies (engaging in active combat as well), the second one dominated by 
domestic companies connected to the military and political élites. The national legal 
framework is also described, as well as the main companies operating in the country. 
I demonstrate that PSCs are increasingly linked to political, economic and military 
spheres, in a merger of interests that often blurs the lines between the public and the 
private. Internal politics and local population are obviously affected by such a 
pervasive phenomenon; I show that the proliferation of local PSCs has contributed 
to the erosion of state sovereignty and to human rights violations. The hiring of 
PSCs for one’s own survival is an underlying choice of the ruling élite which has 
contributed to the destabilization of the country (Vignarca 2004).  
I conclude that Angola is an example of the problems that plague a resource-
dependent state: it is not reliant on domestic taxation or on a diversified economy, its 
rulers have opportunities of wealth accumulation, and political power is a means for 
economic enrichment. This vicious circle has disruptive effects on  governance and 
respects for human rights, while economic growth has practically no impact on social 
development. Corruption has become a way of life for the élite, and “evidence of the
Introduction 
- 7 - 
criminal nature of Angola’s political economy is irrefutable, abundant and mounting” 
(Power 2001). 
The international community hopes that the global economic crisis and the fall 
in oil price may be an opportunity for focusing attention on Angola’s corruption and 
for pressing for change. Nonetheless, progress has been limited so far; human 
development remains insufficient, as shown by the Human Development Index, and 
corruption and mismanagement of resources continue undisturbed.  
In Angola there is a great democratic deficit which affects the security sector as 
well. As Sogge
5
 sees it,  
 
“Angola’s is at best an ‘unfinished democracy’, (...) whose 
political system blocks (the) emergence (of institutions for 
transparency and accountability) because it has been captured 
by domestic élites working in alliance with powerful outsiders, 
such as oil companies, who themselves escape most forms of 
public accountability because global governance is weak, and 
often framed to favour powerful financial interests” (Sogge 
2007). 
 
The alliance of Angola’s ruling class with the oil industry and the growing 
importance of China as a competing mercantile power have allowed the country to 
escape donor pressures, which thus has given little or no contribution to citizen 
empowerment (Sogge 2007). In this context, the private security industry is just 
another brick in the wall of corruption, patronage and poverty which dominates 
Angola.  
                                                           
5
 David Sogge is Researcher at the Transnational Institute, Amsterdam.
- 9 - 
 
 
 
 
 
 
Part I 
 
 
Shadow States and 
Private Security Companies
Chapter I 
- 11 - 
 
Chapter I 
 
SHADOW STATISM AND THE 
APARTHEID OF SECURITY 
 
 
 
“No hay democracia si hay gente tan rica 
que pueda comprar a otros, 
ni gente tan pobre 
que necesite venderse para vivir.” 
José Nun 
 
“Ten years from now, twenty years from now, 
you will see: oil will bring us to ruin... 
Oil the Devil’s excrement.” 
Juan Pablo Pérez Alfonzo 
  
 
The dynamics of relationship between private power, commerce and state 
institutions in weak states are particularly interesting to create a framework within 
which to understand the phenomenon of Private Security Companies. Private 
security in developing states is in fact a key bolstering factor of the informal 
networks that operate alongside government bureaucracies. As there is no widely 
accepted typology of developing states in the academic world, I adopt Reno’s 
concept of neo-patrimonial shadow state, which can exist in various degrees. State-
building is in fact inversely proportionate to the presence of shadow state 
characteristics (Scott 2007).
Shadow Statism and the Apartheid of Security 
- 12 - 
Paragraph 2.1 will introduce the concepts of security, mercenaries and 
corporate security. In paragraph 1.2, I will define the terms Corruption and Neo-
patrimonialism, useful to understand the concepts which will be later introduced. 
Then, paragraph 1.3 will thoroughly explain the definition of Shadow State given by 
William Reno; this concept is central to my thesis, for I conceive the phenomenon of 
Private Security Companies as embedded within this framework. In 1.4, the social 
consequences of the creation of shadow states will be discussed, that is the 
polarisation between L’Afrique utile and L’Afrique inutile. In paragraph 1.5 I will show 
how shadow states are often also rentier states, and I will discuss about the 
consequences for internal security, introducing the concept of “apartheid of 
security”. Paragraph 1.6 is a sort of personal answer to the eternal debate over Neo-
colonialism. Finally, paragraph 1.7 will explain the emergence of shadow states in the 
particular case of the African continent.  
 
 
1.1 Concepts and Definitions  
1.1.1 Security 
According to Liberalism, the term Security means “protection from harm”, 
referring particularly to the protection of individuals and their private properties. 
Historically, it is the state that was in charge of this responsibility. Nonetheless, in the 
last decades there has been a significant shift, with the emergence of the so-called 
“militianisation” (Lock 1998, in Muthien 1999), which means that individuals provide 
for their own security. In this way, security becomes a commodity, subject to the 
rules of the market like every other good. 
As Buur
1
 et al. (2007) see it, security “is associated with perceived threats to the 
survival of individuals and states and with the use of exceptional means of countering 
these threats.” Security “is about real questions about violence, but it is also a way of 
representing particular problems in a manner that makes them exceptional and a 
question of survival;” what matters is “which groups of people are in a position to 
define other groups as a security threat” (in Marques de Morais 2007). 
 
                                                           
1
 Lars Buur is PhD,  Ethnography & Social Anthropology 
Senior Researcher, research unit on Politics and governance, at the Danish Institute for International Studies.
Chapter I 
- 13 - 
1.1.2 Mercenaries  
The term “mercenary” usually carries negative connotations, as mercenaries are 
assumed to be motivated by money. According to Nathan
2
, mercenaries are 
 
“soldiers hired by a foreign government or rebel 
movement to contribute to the prosecution of armed conflict – 
whether directly by engaging in hostilities, or indirectly through 
training, logistics, intelligence or advisory services – and who do 
so outside the authority of the government and defence force 
of their own country” (Nathan 1997). 
 
The most widely accepted definition is provided by Article 47 of the 1997 
Additional Protocol I to the Geneva Convention, however: 
 
“A mercenary is any person who: 
a) is specifically recruited locally or abroad in order to fight in an armed 
conflict; 
b) does, in fact, take direct part in the hostilities; 
c) is motivated to take part in the hostilities essentially by the desire for 
private gain and, in fact, is promised, by or on behalf of a party to the 
conflict, material compensation substantially in excess of that promised 
or paid to combatants of similar ranks and functions in the armed forces 
of that party; 
d) is neither a national of a party to the conflict nor a resident of a territory 
controlled by a party to the conflict; 
e) is not a member of the armed forces of a party to the conflict; and 
f) has not been sent by a state which is not a party to the conflict on 
official duty as a member of the armed forces.” 
 
Nathan’s definition is more inclusive than this one, since mercenaries tend to 
deny their active role in combat. However, mercenary activities go beyond active 
                                                           
2
 Laurie Nathan is executive director of Centre for Conflict Resolution (formerly the Centre for Intergroup 
Studies).
Shadow Statism and the Apartheid of Security 
- 14 - 
combat, including services ranging from training, logistics and advisory services to 
mineral and oil exploration (Muthien 1999). 
 
1.1.3 Corporate Security and Private Security Companies 
There is a hard debate over how to name and define private companies 
offering military and security services, which are considered the most recent 
development of the mercenary phenomenon and provide military and security 
expertise previously reserved to the state. David Shearer coined the term Private 
Military Company (PMC), but many claims there is a clear-cut distinction between 
PMC and Private Security Company (PSC). Singer
3
 introduced the term Privatized 
Military Firm (PMF), while Avant
4
 uses PSC and includes the whole spectrum of for-
profit security companies.  
As regards the definition of PMCs, an interesting one is given by Carlos Ortiz
5
, 
who defines PMCs as  
 
“legally established international firms offering services 
that involve the potential to exercise force in a systematic way 
and by military or paramilitary means, as well as the 
enhancement, the transfer, the facilitation, the deterrence, or 
the defusing of the potential, or the knowledge required to 
implement it, to clients” (Ortiz 2010). 
 
From this definition, it can be inferred that not all the services offered involve 
the use of force, but they all impact on the management of state defence and 
security. Ortiz also draws a distinction between Stand-Alone and Hybrid PMCs. The 
former primarily provide private military services with a significant degree of 
operational independence, while the latter offer military services, but their primary 
business is not encompassed in the PMC service spectrum. 
                                                           
3
 Peter Warren Singer is an American political scientist and International Relations scholar, specialized on 
21
st
 century warfare. He is currently a Senior Fellow at the Brookings Institution, where he is Director of the 
21
st
 Century Defense Initiative. 
4
 Deborah D. Avant is the Director of International Studies and the Center for Research on International and 
Global Studies (RIGS), and Professor of Political Science at the School of Social Sciences, University of 
California, Irvine.  
5
 Carlos Ortiz, PhD, is visiting research fellow at the Centre for Global Political Economy at the University of 
Sussex, Brighton, UK.
Chapter I 
- 15 - 
The term “Corporate Army” is used by Khareen Pech
6
, who defines it as the 
following: 
 
“A privately owned military group whose finances, 
personnel, offensive operations, air wing division and logistics 
are all handled within a single group or through interlinked 
companies and enterprises. In its most basic form, it would be 
managed by a common pool of directors and have a small 
permanent corps of staff, serving its own commercial interests 
and those of affiliated entities. Such a group of companies 
would typically be owned, organised, paid and deployed by the 
controlling shareholders of one or more private companies, 
which, in turn, may be transnational conglomerates. As such, 
the traditionally state-owned powers and instruments for 
effecting political and social change through the use of force are 
transferred through privatisation to a corporate entity or group. 
These powerful entities function at both a corporate, suprastate 
and the transnational level thus transferring the powers of a 
global city-state to a corporate group that is essentially 
accountable only to laws of profit and those of supply and 
demand” (Pech 1999). 
 
As Singer explained, PMFs represent “the next evolution in the provision of 
military services by private actors.” (Singer 2007) Singer identifies six main features 
which distinguish these new private military agents from previous forms of 
privatisation of force. First of all, PMFs are commercial enterprises, hierarchically 
organised into registered corporate structures and integrated into the global market. 
Second, the business profit is the driver of their activity, and, as firms, they can use 
corporate financing to work out deals and contracts. Furthermore, PMFs are 
registered legal entities which sign contractual and binding agreements with their 
employers, and they are often listed on stock exchanges. Fourth, they provide a wide 
                                                           
6
 Khareen Pech is a Mail & Guardian Online journalist. The Mail & Guardian Online was the first internet-
based news publications in Africa. It is one of South Africa's and Africa's major news publishers and is 
reputed internationally for its quality content.