Chad plans to ignore objections from the World Bank and change a law meant to safeguard oil profits for future generations so it can access millions of dollars more quickly, its oil minister said Monday, reports the World Bank press review.
Under a law agreed with the global lender, touted as a test case in Africa to show that petro-dollars can benefit the poor, 10 percent of proceeds from crude production were being saved in a special overseas fund meant to fight poverty in the long term in the poor west African country.
– The government is going to change law 001 relating to the management of oil revenues, Chads oil minister Mahamat Nasser Hassan said adding:
– It is not just about getting access to the 20 billion CFA francs (36 million US dollar) destined for future generations, but about correcting this law and adapting it to the needs of the moment.
The World Bank had pressed Chad to pass the original oil revenues law in exchange for funding for a 3,7 billion dollar pipeline, which carries crude oil 1.000 km from the landlocked country to the Gulf of Guinea to be exported.
In response to the proposed law change, World Bank officials in Washington have said the global body may withdraw from the investment and halt lending to the government, a move which would be a major setback for its biggest investment in the worlds poorest continent.
The government has said Chad is not reaping the rewards from the oil project and that it is struggling to pay salaries and pensions, meaning it needs access to the funds immediately.
Hassan said he was not aware that the World Bank was considering pulling out, but he had seen its initial statement in which it urged the government to address “grave weaknesses in public financial management” to ensure the goals of the oil revenue management scheme were protected.
– The original spirit of law 001 will be respected. The oil revenues should help the fight against poverty, Hassan said.
Chad was recently ranked as the worlds most corrupt country in a Transparency International survey of 159 states and experts say its economic woes stem to a large extent from widespread mismanagement of public money.
Increased security costs related to thousands of refugees fleeing the Darfur conflict in neighboring Sudan have also burdened the economy of the former French colony, whose 9,5 million people get by on an average of 240 dollar (1.480 DKR) a head a year.
The World Banks decision to fund Chads oil pipeline, developed by an Exxon Mobil -led consortium, has been criticized by aid agencies and environmental groups. – Once the money is flowing, the unholy trinity of oil, power and corruption will make corrective action difficult, warned Friends of the Earth.
Some analysts say the need to beef up state security is the real factor behind the governments thirst for cash. The US embassy in the capital NDjamena warned recently of a possible terrorist attack on the pipeline.
President Idriss Deby also faces an internal threat from scores of soldiers who fled their barracks before regrouping in the countrys remote and volatile east last month. The deserters threaten to force him from power unless he accepts calls to step down.
Kilde: www.worldbank.org
