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Blackwater Founder Advising Chinese Firms On Risk In Africa

Blackwater Founder Advising Chinese Firms On Risk In Africa

Blackwater founder and Navy SEAL Erik Prince is helping Chinese firms “take the drama out of Africa” by consulting on how they should do business on the continent, according to a report in FireDogLake.com.

Formed in 1997 to provide training support to military and law enforcement, Blackwater USA worked with SEAL and SWAT teams. The security firm won its first U.S. government contract after the bombing of the USS Cole off of the coast of Yemen in October 2000. Blackwater subsequently trained more than 100,000 sailors.

Prince sold his share in Blackwater in 2010 but retained rights to the Blackwater name. Blackwater became a household name in 2007 when a group of its employees shot at Iraqi civilians in Nisour Square, Baghdad, killing 17 and injuring 20. The company is now known as Academi.

Africa is a major target for Chinese investment to secure resources, and Prince’s new company — Hong Kong-headquartered Frontier Services Group (FSG) — provides risk management, logistics, and aviation services to companies that want to set up in Africa, according to FireDogLake.com.

Based in Hong Kong, FSG works closely with one of China’s state-owned enterprises, CITIC Group, according to the report. CITIC is a state-owned investment group worth
about $12 billion with 44 subsidiaries that owns banks in the U.S., Canada, Australia, Hong Kong and New Zealand. CITIC was in talks at one point to buy Morgan Stanley, according to the report.

Prince said most of his Chinese clients are interested in resources in Africa including gold, steel, energy, bauxite, copper and tin.

The words, “high risk, high return” apply to doing business in Africa, Prince
said, but he encourages his Chinese customers to focus on another slogan: “happy locals, happy project.”

Chinese companies face certain risks simply because they have a lot of people in
Africa, he said. It is important that they form local partnerships.

“If there’s a concerted effort against some regime in a country, then anyone there helping that country build its infrastructure … will be subject to the wrath of that insurgency,” Prince said. “Some blame might get wrongly put on a Chinese firm that’s just there building a road, so there’s animosity directed towards them.”

Prince will be operating in parts of the world that often have difficulty enforcing the rule of law, the report said — this time on behalf of Communist China trying to secure needed resources in volatile areas.

Check out this 2013 ABCNews video of Prince being interviewed on his Virginia farm.