Chad Seeks to Make Most of Oil Exports

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Chad began exporting oil last year. But petroleum in Africa has fueled civil unrest in Angola, Nigeria and Sudan. Chad has vowed to avoid these and other problems.

LIANE HANSEN, host:

For some poor countries, natural resources provide hope for economic development. The central African country of Chad became an oil exporting nation just last year. But petroleum in Africa has at times been a curse. It has fueled civil unrest in such places as Angola, Nigeria and Sudan. And in many of Africa's largest oil-exporting countries, people are poorer now than they were before the crude started flowing. Chad has vowed to avoid these problems; however, not long after becoming Africa's latest petro state, Chad's civil servants aren't being paid and humanitarian groups complain that oil revenue earmarked for poverty alleviation is being wasted. NPR's Jason Beaubien reports from Chad's capital, N'Djamena.

JASON BEAUBIEN reporting:

Things are quiet at the national hospital in N'Djamena because the doctors, nurses and technicians have all walked off the job. Elhodge Jabrilla(ph), the coordinator of surgery at the hospital, waves his arm at the empty benches in the main waiting room.

Mr. ELHODGE JABRILLA (Coordinator of Surgery, National Hospital): (Foreign language spoken)

BEAUBIEN: `The strike has affected 80 percent of our activities,' Jabrilla says. `We are fighting for our rights, but it's also affecting the sick.'

Medical staff at the national hospital haven't been paid since June. This, despite a brand-new oil pipeline that last year generated $150 million for Chad and is expected to bring in even more money this year. In addition to the health-care workers, the tax collectors and the staff at the Ministry of Education are also on strike. The rest of the civil servants have threatened to join them at the beginning of September, again because they haven't been paid in weeks.

(Soundbite of street noise)

Mr. ASALLI HUMDULLAH(ph) (General Secretary, Chad's Largest Labor Union): (Foreign language spoken)

BEAUBIEN: Asalli Humdullah, the general secretary of Chad's largest labor union, says the paradox is that his country is finally exporting oil, yet there's been no improvement for ordinary workers. He says the increase in national resources is being squandered due to corruption and mismanagement and he says the current situation is unsustainable.

Mr. HUMDULLAH: (Foreign language spoken)

BEAUBIEN: `I think someday there will be a revolution against the government,' Asalli says. `People know that there's money, but it disappears.'

Even with its oil, Chad is one of the poorest, least-developed countries in Africa. In the capital, there's no reliable electricity and in most of the rest of the country there's none at all. Eighty percent of Chad's population survives on less than $1 a day.

(Soundbite of car horn)

BEAUBIEN: Along Avenue Charles de Gaulle, the main street in N'Djamena, the ditches host fetid pools of garbage, sewage and standing water. Battered, aging Peugeot sedans serve as taxis. The doors on the yellow vehicles fly open as they careen around corners. Some have opaque bull's-eyes on their windscreens where an unfortunate passenger was in an accident. Like in most of Africa's oil-producing nations, the gasoline here is imported. It's sold on the streets out of one-liter bottles that used to hold pastis.

But Chad isn't just another African oil producer. Chad's oil pipeline project was touted by development experts as a model of how a poor country could avoid the resource curse.

Mr. MICHELLE BARCA(ph) (General Secretary, Petroleum Revenue Oversight & Control Committee, Chad): (Foreign language spoken)

BEAUBIEN: Michelle Barca, the general secretary of Chad's Petroleum Revenue Oversight & Control Committee, explains how Chad's oil revenue is divided up.

Mr. BARCA: (Foreign language spoken)

BEAUBIEN: `Fifteen percent of the money goes to the central government, 5 percent goes to the oil-producing region, and 80 percent is for projects that alleviate poverty; for example, education, infrastructure, health services, drilling wells.'

The pipeline was built by an oil consortium led by ExxonMobil. The World Bank provided funding for the project and put in place systems to direct most of the new revenue towards development. On paper, Chad's oil program is revolutionary in Africa. But despite an influx of hundreds of millions of additional dollars from the project, the government still can't cover its bills. Moussa Hourmadji Doumgor, the minister of communication, says the problem is that the country isn't allowed by the World Bank to use the oil revenue for existing salaries.

Mr. MOUSSA HOURMADJI DOUMGOR (Minister of Communication, Chad): (Foreign language spoken)

BEAUBIEN: `The people of Chad don't understand the situation,' he says, `and it's causing a lot of social tension.'

Last year, the World Bank allowed the government to use some of the poverty alleviation funds to pay wages to the civil servants. Hamaji says the government is negotiating again this year with the World Bank to divert some of the new oil money towards government salaries.

Mr. DOUMGOR: (Foreign language spoken)

BEAUBIEN: `Before the oil era, we received budget assistance from international donors,' he says. `But now the partners think we have enough money and they don't help us as much.'

Like many African countries, more than half of Chad's national budget is funded by international aid agencies. The drop in direct foreign assistance to the Chad treasury did coincide with the opening of the pipeline, but it also coincided with the International Monetary Fund pulling out of the country. The IMF suspended funding for all of 2004 because of mismanagement and poor fiscal oversight of IMF-funded projects. And while the IMF has returned, complaints about mismanagement of government funds are still widespread.

Earlier this month, President Idress Deby reshuffled his Cabinet to address what he called a crisis of mismanagement. The president, who seized power in a 1990 coup, just won a widely criticized referendum so he can run for office again in 2006. Despite Chad's poverty, Deby's presidential motorcade includes 12 brand-new Hummers.

Ms. TERESE McCUMBAY(ph) (Petroleum Oversight Committee, Chad): (Foreign language spoken)

BEAUBIEN: Terese McCumbay, who represents civil society groups on Chad's Petroleum Oversight Committee, says the financial management problems, which prompted the IMF to suspend its program in Chad, still exist.

Ms. McCUMBAY: (Foreign language spoken)

BEAUBIEN: Referring to problems with the oil revenue, she says, `There are problems with school benches that were purchased that are of bad quality. Also, buildings were abandoned during construction. Other buildings weren't built properly. And stocks of grain were paid for, but never delivered.'

She says there needs to be tighter fiscal control by the government on the new oil money. Her committee has a small staff and only two vehicles. She says they can't be expected to oversee millions of dollars in new spending by a government that has a long history of corruption. Her committee has submitted two reports to the government chronicling the misuse of oil revenue, but so far she says they've gotten no response. Jason Beaubien, NPR News, N'Djamena, Chad.

HANSEN: You're listening to WEEKEND EDITION from NPR News.

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