Cameroon feels let down by World Bank and pipeline project

Sep 12, 2002 02:00 AM

Outside the village of Mpango, western Cameroon, about 20 young men have laid down branches and rocks to block access to the site of a controversial new oil pipeline that ends at the nearby coast. As a blue-uniformed security guard lurks silently at the back of the crowd, the youths argue that the World Bank-supported project has failed to bring the social benefits they had expected.
"Before, we had confidence," asserts Victor Ayessi, who says he is unemployed and had hoped for work on the project. "Now we find our confidence has been abused." His complaint highlights the risks the World Bank is taking by supporting a landmark initiative that should bring oil wealth and development to Cameroon and Chad, two of the world's poorest countries.

The involvement of the bank, whose board decided to maintain support for the project despite the misgivings of a group of independent inspectors, has raised local expectations on issues such as compensation for environmental damage and terms of employment.
"The World Bank should come on the ground to make enquiries," says Gerard, a Cameroonian manager who left the project earlier this year. "The pipeline is not a bad idea [but] the conditions and salary were not good."

The bank argues the pipeline is precisely the sort of development where its approach can help, bringing a framework of environmental, social and anti-corruption safeguards to bear on a highly lucrative enterprise. The project, which will yield an estimated $ 500 mm (EUR 515 mm, £ 325 mm) in revenues for Cameroon and almost $ 2 bn for Chad over a 25-year oil production period, closely reflects the bank's growing vision of itself as a facilitator and regulator of private investment rather than simply a source of cheap money.
The bank's direct share of the investment, about $ 140 m, accounts for only a small proportion of the total $ 4 bn cost of the pipeline, which is expected to be completed late next year and will extend 1,070 km from Chad's Doba oil fields to an offshore terminal at Kribi in Cameroon. A more important input is the bank's seal of approval, which adds credibility to a project run by an industry with a history of turbulent community relations.

The Chad-Cameroon pipeline, operated by ExxonMobil with additional investments from ChevronTexaco and Petronas, is being built amid disputes between oil companies and local people in nearby Nigeria. The industry is conscious of the heavy international criticism suffered by Shell after the executions of Ken Saro-Wiwa and other social activists in 1995 by the government of Sani Abacha, Nigeria's late military dictator.
Critics say the bank's participation helps to legitimise exploitative and damaging interventions by multinationals and repressive behaviour by governments in poor countries. "The bank's involvement only pretties up a dirty picture, and thus reassures private investors who might otherwise be skittish," says Steve Kretzmann, policy analyst at the left-leaning Institute for Policy Studies in Washington.

The bank has, however, gone to unprecedented lengths to fireproof itself against criticism of the project, setting up two separate advisory groups -- one headed by Mamadou Lamine Loum, former prime minister of Senegal, as well as its independent inspection panel. Management defended itself against criticisms made by the panel over issues such as alleged shortcomings in environmental assessments and policies on revenue distribution. "The bank has made exceptional efforts to apply its policies and procedures and to pursue concretely its mission statement," the management says.

Funnelling project money through the governments of the two countries, the bank argues, will help exert pressure for improvements on governments criticised for records on human rights and respect for the law. Speaking under a smiling picture of Mr Biya, which describes the president as "le meilleur choix" or "the best choice", Mpango's traditional rulers say their community has suffered a series of disappointments over issues such as compensation for farmland destroyed by the pipeline.
The payment of about CFA Fr 150,000 ($ 225, EUR 228, £ 144) for each lost mango tree is small compared with potential fruit production income of CFA Fr50,000 each year for a decade, argues Narcisse Savah, one of the rulers. As the wet season's rain pours on the roof above, Mr Savah describes the so-far unfulfilled hopes for community development that have disappointed the villagers and are causing local youths to demonstrate. "We have asked for the construction of a classroom and other small things," he says. "At the moment we have nothing."

Source: The Financial Times
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