Business in Africa (Johannesburg)

Chad: Country Wants to Buy Arms With Frozen Oil Money

N'Djamena — Oil revenue that was meant to be used as part of a poverty alleviation fund will be used to buy weapons, the Chadian president confirmed.

President Idriss Deby asked France's Le Figaro: "Which country in the world wouldn't want to buy arms to defend itself if it had the money?"

The reality though is that Chad is one of the poorest countries in the world and cannot afford to support a Deby's failing regime.

Derby complained that Sudan was arming Chadian rebels and that the World Bank had made the land-locked country poor by freezing the country's oil production royalties.

The World Bank froze the money after it became clear that Chad would not abide by an agreement requiring that a percentage of oil revenue was invested for future poverty alleviation efforts. The bank provided funding for a $3.7bn oil pipeline to carry oil to the coast for export.

The World Bank initiated the project as a pilot project and given Chad's disregard for the agreement they signed it is unlikely that the bank will easily consider funding projects of this nature in the future. In this way, Chad has made Africa poor by making it more difficult and, therefore, more expensive to access funding.

Chad wishes to use the blocked money to buy weapons and has threatened to halt supplying oil should the money is not unfrozen by the end April this year.

About 170 000 barrels a day through the pipeline, which is operated by ExxonMobil Corp, Chevron and Petronas.

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