When two poor countries reclaimed oilfields, why did just one
The outcry over Bolivia's renationalisation and the silence over
Chad's betrays the hypocrisy of the critics
By George Monbiot
05/16/07 "The Guardian"
-- -- Civilisation has a new enemy. He
is a former coca grower called Evo Morales, who is currently the
president of Bolivia. Yesterday he stood before the European
parliament to explain why he had sent troops to regain control
of his country's gas and oil fields. Bolivia's resources, he
says, have been "looted by foreign companies", and he is
reclaiming them for the benefit of his people. Last week, he
told the summit of Latin American and European leaders in Vienna
that the corporations which have been extracting the country's
fossil fuels would not be compensated for these seizures.
You can probably guess how this has gone down. Tony Blair urged
him to use his power responsibly, which is like Mark Oaten
lecturing the Pope on sexual continence. Condoleezza Rice
accused him of "demagoguery". The Economist announced that
Bolivia was "moving backwards". The Times, in a marvellously
haughty leader, called Morales "petulant", "xenophobic" and
"capricious", and labelled his seizure of the gas fields "a
gesture as childish as it is eye-catching".
Never mind that the privatisation of Bolivia's gas and oil in
the 1990s was almost certainly illegal, as it took place without
the consent of congress. Never mind that - until now - its
natural wealth has only impoverished its people. Never mind that
Morales had promised to regain national control of Bolivia's
natural resources before he became president, and that the
policy has massive support among Bolivians. It can't be long
before Donald Rumsfeld calls him the new Hitler and Bush makes
another speech about freedom and democracy being threatened by
freedom and democracy.
This huffing and puffing is dressed up as concern for the people
of Bolivia. The Financial Times fretted about the potential for
"mismanagement and corruption". The Economist warned that while
the government "may get richer, its people are likely to grow
even poorer". The Times lamented that Morales had "set back
Bolivia's development by 10 years or so ... the most vulnerable
groups will find that an economic lifeline is soon removed from
their reach". All this is humbug.
Four days before Morales seized the gas fields - on May 1 - an
even bigger expropriation took place in an even poorer country:
the African republic of Chad. When the Chadian government
reasserted control over its oil revenues, not only did it ensure
that an intended lifeline for the poor really was removed from
their reach, but it also brought the World Bank's claims to be
using oil as a social welfare programme crashing down in flames.
So how did all those bold critics of Morales respond? They
didn't. The whole hypocritical horde of them looked the other
The World Bank decided to fund Chad's massive oil scheme in
2000, after extracting a promise from the government of Idriss
Deby - which has a terrible human rights record - that the
profits would be used for the benefit of the country's people.
Deby's administration passed a law allocating 85% of the
government's oil revenues to education, health and development,
and placing 10% "in trust for future generations". This, the
bank said, amounted to "an unprecedented system of safeguards to
ensure that these revenues would be used to finance development
Without the World Bank, the project could not have gone ahead.
It was asked to participate by Exxon, the leading partner in the
project, to provide insurance against political risk. The bank's
different lending arms stumped up a total of $333m, and the
European Investment Bank threw in another $120m. The oil
companies (Exxon, Petronas and Chevron) started drilling 300
wells in the south of the country, and building a pipeline to a
port in Cameroon, which opened in 2003.
Environmentalists predicted that the pipeline would damage the
rainforests of Cameroon and displace the indigenous people who
lived there; that the oil companies would consume much of Chad's
scarce water and that an influx of oil workers would be
accompanied by an influx of Aids. They also argued that
subsidising oil companies in the name of social welfare was a
radical reinterpretation of the bank's mandate. As long ago as
1997, the Environmental Defence Fund warned that the government
of Chad would not keep its promises to use the money for
alleviating poverty. In 1999, researchers from Harvard Law
School examined the law the government had passed, and predicted
that the authorities "have little intention of allowing it to
affect local practice".
In 2000, the oil companies gave the government of Chad a
"signing bonus" of $4.5m, which it immediately spent on arms.
Then, at the beginning of 2006, it simply tore up the law it had
passed in 1998. It redefined the development budget to include
security, seized the fund set aside for future generations, and
diverted 30% of the total revenues into "general spending",
which, in Chad, is another term for guns. The World Bank,
embarrassed by the fulfilment of all the predictions its critics
had made, froze the revenues the government had deposited in
London and suspended the remainder of its loans. The Chadian
government responded by warning that it would simply shut down
the oil wells. The corporations ran to daddy (the US government)
and, on April 27, the bank caved in. Its new agreement with Chad
entitles Deby to pretty well everything he has already taken.
The World Bank's attempts to save face are almost funny. Last
year, it said that the scheme was "a pioneering and
collaborative effort ... to demonstrate that large-scale crude
oil projects can significantly improve prospects for sustainable
long-term development". In other words, it was a model for
oil-producing countries to follow. Now it tells us that the
project in Chad was "less a model for all oil-producing
countries than a unique solution to a unique challenge". But,
however much it wriggles, it cannot disguise the fact that the
government's reassertion of control is a disaster both for the
bank and for the impoverished people it claimed to be helping.
Since the project began, Chad has fallen from 167th to 173rd on
the UN's human development index, and life expectancy there has
dropped from 44.7 to 43.6 years. If, by contrast, Morales does
as he has promised and uses the extra revenues from Bolivia's
gas fields in the same way as Hugo Chávez has used the money
from Venezuela's oil, the result is likely to be a major
improvement in his people's welfare.
So, on the one hand, you have a man who has kept his promises by
regaining control over the money from the hydrocarbon industry,
in order to use it to help the poor. On the other, you have a
man who has broken his promises by regaining control over the
money from the hydrocarbon industry, in order to buy guns. The
first man is vilified as irresponsible, childish and capricious.
The second man is left to get on with it. Why? Well, Deby's
actions don't hurt the oil companies. Morales's do. When Blair
and Rice and the Times and all the other apologists for
undemocratic power say "the people", they mean the corporations.
The reason they hate Morales is that when he says "the people",
he means the people.
· The references for this and all George Monbiot's recent
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