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World Bank suspends loans to Chad
Associated Press
Published January 7, 2006
WASHINGTON - The World Bank is suspending $124-million in loans to Chad in a dispute over the African nation's decision to change its rules on the use of oil revenues to reduce poverty, Paul Wolfowitz, the bank's president, said Friday.
He said by changing the rules, Chad, one of the world's poorest nations, had breached a 1999 agreement with the bank to obtain financing for the Chad-Cameroon Oil Pipeline Project.
The $4.1-billion project, completed in 2003, transports oil from landlocked Chad in central Africa through Cameroon to the Douala area for export through the Gulf of Guinea.
Wolfowitz said he acted after a two-hour telephone conversation Thursday with Chad President Idress Deby, who said his country was experiencing budget difficulties. Wolfowitz said the bank remained open to discussion with Chadian officials on the issue.
Chad's oil minister, Nasser Mohammed Hassan, said in N'Djamena, the capital, that the government would issue a statement today.
Wolfowitz said he informed the bank's 24-member executive board of his decision Friday morning and they supported him.
"There was a solid consensus that this was the appropriate and needed action, that we had been reasonable but reached a point where we had to be firm," Wolfowitz said.
[Last modified January 7, 2006, 01:25:29]
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