Chad: Escaping from the Oil Trap

Africa Briefing N°65

This briefing is currently only available in French.


Since 2003 the exploitation of oil has contributed

greatly to the deterioration of governance in Chad

and to a succession of rebellions and political crises.

The financial windfall – in 2007, 53 million barrels

earning the government $1.2 billion – has increased

corruption, stoked domestic dissent and led t

o rebellions supported by neighbouring Sudan.

The revenues have also allowed President Idriss Déby

to reject political dialogue with his opponents and

to respond to the threat from Sudan by overarming

his military forces. The hope aroused by the

discovery of oil has given way to

generalised disenchantment.

To escape this vicious circle and establish

the conditions needed for durable stability,

the government must work to establish a national

consensus on the management of oil revenues.

Its principal external partners – France, the U.S.

and China – must condition their support

for the regime on such a consensus.

Chad's petroleum project was bedevilled by numerous
controversies that almost blocked its realisation.
Beginning in 2000, however, the involvement of
the World Bank allowed the project to move forward.

It was an apparent role model for development,
because the mechanisms for managing oil revenues
seemed to guarantee an effective fight
against poverty. These mechanisms specified
that the revenues were to be dedicated primarily
to improving the lives of Chad's present
and future population.

In 2004, less than a year after the exploitation of

oil began, the closing of the nation's political space

for the benefit of President Déby aggravated

dissension within the Chadian power structure

and increased tension throughout the country.

This situation led to several attempted coup d'état

by close collaborators of the president,

who subsequently joined the rebellion

fighting the government.

Weakened by the armed opposition supported

by Sudan, Déby decided in January 2006

to modify the initial system of management of

oil revenues in order to make

more funds available to buy arms.

In reaction, the World Bank suspended

its programs.

Far from forcing the government to backtrack,

this motivated it to put in place regulations

that removed any oversight by the bank

of the management of oil revenues.

The rivalry among Western countries and China

over Chad's petroleum resources has limited

the bank's room to manoeuvre.

The increase in oil prices in 2007 generated

enough resources for the regime to undertake

large public works projects.

Advertised as a way to modernise the country

through oil revenues, these projects led

in 2008 to a budget deficit that is likely

to persist.

Moreover, the opaque awarding of public

works contracts increased cronyism

and corruption.

The government also gradually reduced

the role of the committee that had been

established to involve civil society in the management

of oil revenues, the Committee of Control

and Supervision of Oil Revenues

(CCSRP in French).

By changing the membership of the CCSRP

in 2008, the government limited its ability

to control the use of the revenues.

In sum, oil has become a means for the regime

to strengthen its armed forces, reward its cronies

and co-opt members of the political class.

This has further limited political space for

the opposition and helped keep the country

in a state of political paralysis that has

stoked the antagonism between the regime

and its opponents.

As a result, there is recurrent political instability

that is likely to ruin all efforts to use oil

for the benefit of the country and

its enduring stability.

For the people who have not seen their lives

improve and who are subjected to

increased corruption, oil is far from a blessing.

Given the current situation, the following

measures should be taken to extricate

Chad and its external partners from the petroleum trap:

  • The government should include the question of
  • how to use oil revenues in the domestic dialogue
  • started under the accord of 13 August 2007.
  • It should organise a round table including
  • the political opposition, civil society
  • and representatives of the oil-producing regions.
  • The principal recommendations of the
  • round table should be included
  • in the follow-up mechanisms for the accord.

  • The government should strengthen internal
  • control and oversight mechanisms of oil revenues.
  • The CCSRP's regulations should be revised
  • to stipulate that its members will meet full time,
  • like other independent state bodies,
  • such as the Supreme Court or
  • High Council for Communication.
  • This change is needed to improve
  • the CCSRP's efficiency and
  • technical proficiency.

  • The ethics and justice ministries should
  • systematically apply its recommendations
  • and investigate problems it brings to light.

  • The government should regularise its procedures,
  • so that the great majority of government
  • contracts are let on the basis
  • of competitive bids and not by bilateral agreement.
  • Such a change is indispensable for fighting
  • corruption and for eliminating the opaque
  • awarding of contracts as a source
  • of unjustified enrichment.
  • There should also be an audit of the
  • various public works now being built.

  • The government should ensure an improvement
  • in the technical abilities of civil servants.
  • Petroleum revenues should be used
  • to establish a program supported
  • by civil society to train them
  • on a continuing and regular basis.

  • To replace the International Consultative
  • Group (GIC in French), whose mandate
  • expired in June 2009, an independent,
  • multidisciplinary body composed of
  • representatives of Chadian and international
  • civil society should be created and receive
  • financial support from the World Bank.
  • Its role would be to undertake studies,
  • make recommendations and
  • give technical support to the CCSRP.

  • France, the U.S. and China should collectively
  • support an inclusive Chadian national
  • dialogue in order to create the conditions
  • likely to lead to enduring stability.
  • They should make their support for
  • Déby contingent on the proposed
  • reforms and measures cited above.
  • The three countries, but in particular
  • China, which is present in both the Chadian
  • and Sudanese oil sectors, should also
  • weigh in more heavily in favour of stabilising
  • relations between N'Djamena and
  • Khartoum and of halting support by each country
  • for rebels in the other country
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             J-L K.
Procurement Consultant
Gsm:    (250) (0) 78-847-0205 (Mtn Rwanda)
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  Kigali - RWANDA
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