DAKAR, 27 August 2009 (IRIN) - In Chad oil wealth – poorly managed – has stoked conflict and corruption rather than boost the economy and living conditions, says a new briefing paper by International Crisis Group.

Oil exploitation has contributed to the deterioration of governance in Chad, and the government has progressively cut civil society out of the management of petrodollars, the paper says. “The government must work to establish a national consensus on the management of oil revenues,” ICG says, calling on Chad’s principal external partners – China, France and the United States – to “condition their support for the regime on such a consensus”.

Chad must reform its management of oil revenues – now used largely for paying cronies and building up the military – if it is to avoid further impoverishment and destabilization, ICG says.

The 1,070-kilometre Chad-Cameroon pipeline, which yielded its first oil in 2003, was hailed as a unique effort to make large-scale oil production a driver of sustainable development. Integral to the World Bank’s support of the project was a revenue management scheme that would provide social and economic benefits for the poor including future generations. Chad eventually scrapped the provisions and the World Bank pulled its support for the pipeline.

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