Washington — The World Bank argues that the $4 billion Chad-Cameroon Pipeline Project provides an opportunity for one of the poorest regions in Africa to diversify its economy and increase fiscal revenues. An estimated 80 percent of the Chad population currently lives on the equivalent of less than one U.S. dollar a day. According to the bank, the project could double the rate at which Chad incomes grow for the next decade and dramatically expand infrastructure and the delivery of public services.
This project provides a model of the type of public private partnership that some experts now argue should typify the future of development aid. The World Bank is itself only providing $140 million of the $4 billion financing required for the pipeline project, but that support has been critical to attracting investment from the large oil companies ExxonMobil and Chevron. These giants are now the lead investors in what has become the largest private sector investment project in Sub-Saharan Africa.
The bank says that funds from this project will be used to help address poverty and other social issues. It has worked with the oil companies to construct an elaborate series of mechanisms designed to ensure that 80 percent of the revenues from the pipeline will be available first for use in addressing poverty in general and education, health care and infrastructure issues in particular. An independent International Advisory Group (IAG) is helping steer the project and a National Advisory Group in Chad was designed to increase local participation.
But the project has been dogged by controversy right from its beginnings. The World Bank argues that such risky projects also produce the most rewards and that the risks are worth the potential benefits, particularly for poor countries like Chad. But some Chadians think differently. At least one member of the Chad legislature and local civil society, environmental and human rights groups have argued that the project is going ahead without sufficient input from the people most affected. They contend that the organizing consortium has not done adequate environmental and economic planning and that there is not sufficient public disclosure of information regarding the pipeline.
The principle problem, argues Delphine Djiraibe, the president of the Chadian Association for the Promotion and Defense of Human Rights, is the lack of capacity, within the Chad government and civil society groups, to negotiate beneficial terms with the powerful international oil companies building the pipeline or to monitor the project as it moves forward. Djiraibe helped to file a protest with the World Bank's internal, but independent Inspection Panel, calling for the project to be suspended until these concerns have been addressed.
The Inspection Panel agreed that there were serious problems with the project. But World Bank managers of the project argued that they could make adjustments that would address these problems and that pipeline construction work should not be delayed. Ultimately the World Bank Directors brushed aside the internal Inspection Panel report and approved the management plan on September 12.
To learn more about the civil society perspective in Chad, AllAfrica's Jim Cason spoke by phone with Delphine Djiraibe in N'Djamena, where she is based. Below are excerpts from that interview.
What is your reaction to the World Bank decision to go ahead with the Chad-Cameroon Pipeline?
It is not surprising for me. We have made the World Bank aware of those problems, but they didn't hear. The World Bank is just supporting this project because of the international oil companies. It is a pity such a thing is happening. It is a pity for the population of Chad and Cameroon.
What would you like the World Bank to do instead?
We have asked the World Bank to put the project on hold and to get the minimum conditions on the ground before starting the project. Now that the inspection panel has come to the same conclusions as we did in terms of the problems, it would have been more responsible for the World Bank to put the project on hold and get those conditions in place before pushing ahead.
Right now in Chad nobody is following what the consortium [that is building the pipeline] is doing. Neither the government nor the NGOs [non-governmental organizations] have the capacity to follow what the project is doing. That's the big problem, nobody can understand what is going on.
So you would like them to put the project on hold until the capacity is developed?
Yes, that is logical to me. This is a big project that is supposed to alievate poverty. But if the government itself and civil society do not have the capacity to monitor the project, nothing good is going to happen for them.
What about the argument that this project will bring in so much money that it will enable the increase in the capacity of the government and the civil society?
That is not a good reason [to start construction]. When the project was in discussion, the World Bank, admitting the risks involved, said that money would be available to help the government of Chad and civil society build up their capacity to monitor the project. The World Bank made a commitment and they are not respecting that commitment. The government must have adequate capacity.
There are so many agreements between the World Bank, the companies and the government. If nobody is even following the administration of that money, what is going to happen?
It is not responsible to say that we have to wait for the money from the oil to build the capacity. Because the project will by then be finished and all the problems will be there. It is better to prevent those problems when they come up rather than to try to curb them when they are in place.
The second problem is that our government is well known as a bad manager; there is no transparency and no good governance. In such conditions we can't believe that the oil revenues will be used to build capacity.
The World Bank claims that the national oversight committee [the National Advisory Group] will ensure that the oil revenues are used properly. But that oversight committee is not working properly. There is no way the oil revenues are going to be used properly.
What is happening today in the area where the pipeline is being build?
Both in the oil area, and in the capital city, we have inflation so high that people cannot afford their daily life. For example, the chicken that you could buy two or three years ago for less than a dollar, now you have to buy it for two or three dollars. That is terrible for everyone.
Is that inflation caused by this project?
Yeah, sure. Because many people are migrating from the rural areas to the oil regions. And many others are coming in from outside of Chad.
You argue that the World Bank is acting in the interests of the oil companies. But the bank argues that its main purpose is poverty reduction. There is, right now, widespread debate about the role of the World Bank as an institution. How do you view the bank?
I think that the World Bank is a bank as any other bank. In my view they are just putting development in favor of business. In a country like Chad, the World Bank has had many more projects than any other group. And yet now Chad is one of the poorest countries in Africa. We are one of the least developed. So, where did those monies go?
If the World Bank is really a development bank, it has to take into consideration the needs of the people.