- The oversight committee looking into how Chad has spent revenues from its first year of oil exports has found several grace "irregularities". While much of the oil revenues have been poorly spent, the oversight committee is generally hailed for having taken its responsibilities seriously, providing hope for improvements.
The Chadian Oversight Committee has just released its first report - "Collège de Contrôle et de Surveillance des Revenues Pétroliers" (Report of Mission to Sites of Projects Financed by Oil Revenues). This is the Committee's first inspection of the implementation of projects in the priority sectors financed by Chad's 2004 oil revenues.
The Committee was established as part of a deal struck between the World Bank and the government of Chad, following the Bank's funding of the Chad-Cameroon Pipeline, which made Chadian oil exports possible. Chad has agreed to use most of its oil revenues to finance anti-poverty projects at a national level and in particular in the oil production southern region.
According to the deal with the World Bank, the parliament of Chad has approved of laws that regulate the use of oil revenues in detail and that provide full transparency related to these revenues. The Oversight Committee was established to control if these funds were spent in accordance with legislation. As the first oil revenues poured into the country in 2004, the Committee started its work.
The Committee's first report however shows that national and local projects to fight poverty largely have been badly administered. The report cites incidents of irregularities in transfers of funds; poor quality of, and long delays in the delivery of goods and services; and lack of competitive bidding processes, and cases of overpricing of goods and services.
The report also assesses that some local authorities were not informed of projects planned in locales under their administrative responsibility. Coordination of projects financed by oil revenues therefore had been poor in several districts.
While the results of the Committee's assessment were more disappointing than expected, the Committee today was hailed for its good work by the World Bank for "the thoroughness, rigor and transparency demonstrated in this report." According to a statement by the Bank, the report was "a sign that the members of the Committee take their responsibilities seriously, and do not intend to play a symbolic role in approving spending towards poverty reduction."
The report was further seen as a testimony to the recently established Committee's "commitment to professionally execute the post-approval monitoring and control included in its mandate, and demonstrates that the group has had the freedom to pursue its investigations," the World Bank said. "Publication of this report is also a demonstration of the Chadian government’s commitment to the transparency of its oil revenue management, as claimed in the laws governing these resources," the statement added.
The Oversight Committee in its report made a series of recommendations to improve the spending of Chad's oil revenues, which were welcomed as "positive, forward-looking and constructive" by the World Bank. The Bank had already asked the N'djamena government "to accept and facilitate the implementation of the Committee's recommendations, as a sign of its commitment to the spirit, as well as the letter, of the law that dictates the role of the Oversight Committee."
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