Jai Singh in The New Republic:
Two weeks ago, Chad’s authoritarian president Idriss Déby effectively revoked a law requiring his government to spend 80 percent of the country’s oil revenues on health, education, and infrastructure while placing 10 percent of the revenue in a fund for future generations. The law was part of a 2000 agreement in which the World Bank and an ExxonMobil-led oil consortium agreed to fund a massive project to extract Chadian oil and pipe it through Cameroon for export.
Wolfowitz, now in his eighth month on the job, responded to Déby’s move by ending all future Bank disbursements for its eight projects in the country, which would have totaled $124 million over several years. He also froze a bank account that held millions in Chadian oil revenue. Playing hardball with a small and impoverished country may seem like overkill, but in reality this is a high-stakes dispute that will have key ramifications. Firms are combing Africa in search of new oil fields, and the best hope for staving off the corruption and abuse that is bound to result from future projects is good revenue management.
More here.