Summary: The Ebola virus has brought health scares with it worldwide, but it may also have devastating economic effects on the countries in which it is present.
The American Lawyer reports that for many Am Law firms who conduct business in West Africa, the Ebola virus could have devastating financial consequences. The World Bank recently predicted that if the Ebola virus continues to spread, an $809 million loss could be expected in just Guinea, Liberia and Sierra Leone. The number of victims who have died from the disease continues to rise, and is currently at 4,493 deaths since March.
So far, law firms that have clients in West Africa have had to postpone conferences and handle travel restrictions. For a job that prefers face-to-face meetings, adjusting to videoconferences has been quite the change.
Pascal Agboyibor is the head of Orrick, Herrington & Sutcliffe’s Africa practice, which he runs from the Paris office of the firm. Orrick works on capital market matters, power and infrastructure markets, and mining issues throughout West Africa, including Burkina Faso, Senegal, Ivory Coast, Guinea, and Nigeria. None of the attorneys at Orrick have visited West Africa since this summer. Agboyibor said, “Because we have a big portfolio in Guinea, this is a serious issue for us.” Guinea has sought Orrick out for several matters, but the work has slowed. He added, “Everyone is doing their best to maintain their regime.” Agboyibor is currently assisting the Guinean government review 20 mining contracts that had previously been signed with the globe’s largest aluminum companies.
The firm plans to ride out the virus scare for now. Agboyibor commented, “From what I see and hear, I don’t believe anyone is reevaluating their pans over the long term. There’s too much at stake—too much money and interest. We spend years negotiating before these things come [together]. So everyone is trying to find a way to keep things moving along.”
However, a weakened economic state may be the exact reason firms need to stay with their West African clients. In September of 2013, Allen & Overy guided a subsidiary of China Power Investment Corp. on an alumina-mining contract with the Republic of Guinea—the deal is part of a $6 billion project taking place there. King & Spalding represented the government of Guinea in the transaction.
Dentons
However, Ryan Ketchum, a partner with Hunton & Williams who works on energy and infrastructure issues, has indicated that no projects that firm is handling have been halted. This includes a project that will restructure the Nigerian electricity sector. He did state that a possible fear of contagion may be why some meetings were moved to European locations instead of meeting in Africa. “I suspect that a few meetings have taken place in alternate locations, but it wasn’t really something that was talked about in an open way, because no one wants to admit that they can’t travel for that reason.” However, the firm is “absolutely not” pulling back on its West African clients.
Stéphane Brabant heads Herbert Smith Freehills’ energy and infrastructure practice in Paris. Brabant is also head of the Africa practice and is a co-leader of the mining group and business and human rights group. That firm also remains committed to “[encouraging] investments in Africa, including in that part of the world with full knowledge of what is going on as it would be the case in any other part of the world. It is our responsibility to find ways to continue to support our clients and friends in Africa on its long-term growth trajectory, working around these short-term challenges.” Brabant has worked in West Africa for close to three decades. The firm announced in 2012 it planned to open a Guinea office due to its potential for valuable energy and infrastructure work.
Alexander Msimang is the head of Vinson & Elkins’ London office. He has handled multiple oil and gas deals across West Africa. Msimang stated oil, gas and energy companies are implementing procedures for handling employees returning from site projects. The oil and gas industry is “very accustomed to dealing with challenges of all sorts … which tends to make me think that the industry is likely to find a way to let operations continue for the time being … it’s an expensive, challenging, capital-intensive business at the best of times. Our expectation is that our clients are going to continue to carry out business — they’ve got to overcome it.”
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