VZCZCXRO0020
OO RUEHROV
DE RUEHNJ #0510/01 3051130
ZNY CCCCC ZZH
O 311130Z OCT 08
FM AMEMBASSY NDJAMENA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 6555
INFO RUCNFUR/DARFUR COLLECTIVE
RUEHAR/AMEMBASSY ACCRA 0557
RUEHBS/AMEMBASSY BRUSSELS 0303
RUEHTRO/AMEMBASSY TRIPOLI 0498

C O N F I D E N T I A L SECTION 01 OF 03 NDJAMENA 000510 
 
SIPDIS 
 
ACCRA FOR REGIONAL USAID 
 
E.O. 12958: DECL: 10/31/2010 
TAGS: PREL PGOV ECON PREF EU PINR IBRD EIB CD
SUBJECT: EU WORKING TO KEEP CHAD ON TRACK FOR 2009 
ELECTIONS, DESPITE SETBACKS, AND WILL TACKLE GOC OIL 
REVENUE MGMT, TOO 
 
NDJAMENA 00000510  001.2 OF 003 
 
 
Classified By:  DCM REGribbin for reasons 1.4 b&d 
 
-------- 
SUMMARY 
-------- 
 
¶1. (C) The Chief European Union Representative in Chad 
believes that the electoral reform process that he is 
spearheading can result as planned in communal/legislative 
elections in 2009, but that success is by no means assured at 
this point.  The EU Ambassador believes that enough momentum 
has developed in the cabinet so that draft legislation to 
reestablish a reformed National Electoral Commission would be 
sent to Parliament next week, but notes that Zaghawa and 
other hard-liners near the President remain committed to 
torpedoing progress. Powerful ministers, the "hawks" he 
called them -- Bachir at Interior, Younousmi at 
Infrastructure and Moussa Faki at Foreign Affairs -- 
continued to try to undermine the President's and the PM's 
reformist inclinations. The EU Ambassador reported agreement 
in principle with the President and PM for an EU-funded 
expanded transparent mechanism to track all/all oil revenues 
and expenditures, with the EIB, the IMF, the World Bank, and 
the Oil Revenue "College" as possible partners.  The EU Chief 
Representative judged that in Chad the greatest development 
obstacle is not lack of money, but lack of expertise. END 
SUMMARY. 
 
----------------------------------- 
ELECTORAL REFORM ON TRACK, BUT.... 
----------------------------------- 
 
¶2. (U) Gilles Desesquelles, Ambassador of the European Union 
in Chad since 2006, shared views with the AMB and DCM on 
October 29.  The EU is the lead donor in funding and 
supporting Chad's internal democratic reform process and 
Desesquelles himself was the main architect of the August 13, 
2007 Accord on electoral reform that undergirds that process 
Desesquelles said that finally the long-stalled draft 
legislation to reform and reestablish the National Electoral 
Commission should be approved in cabinet on October 31 and 
sent to Parliament for passage.  He noted that now as in the 
past it will take a mustering of influence and leverage by 
the Prime Minister and the President to move ahead. 
Desesquelles identified three ministers - Bachir at Interior, 
Younousmi at Infrastructure and Moussa Faki at Foreign 
Affairs -- as the hard-liners, or "hawks," as he called them, 
dedicated to preservation of a Zaghawa-dominated power 
structure that admitted allies of other ethnic groups, 
especially Gorane northerners.  Desesquelles opined that they 
would continue to be obstructionists, working through allies 
in the National Assembly. (Faki's obstructionism was 
political, Desesquelles surmised, "He wants to be Prime 
Minister again.")  Nonetheless, the EU ambassador was 
optimistic that, once the cabinet logjam was broken, that 
legislation could be pushed through by the end of the year. 
Desesquelles said he was prepared to break a logjam by going 
directly to President Deby to give him a kind of ultimatum. 
The National Assembly, the EU Chief noted, had never refused 
to respond rapidly and positively to Presidential direction. 
 
--------------------------------------- 
EU TO WORK ON OIL REVENUE TRANSPARENCY 
--------------------------------------- 
 
¶3. (C) Desesquelles said Chad's recent conflict with the 
World Bank and inability to maintain a normal relationship 
with more forthcoming IMF underlined the massive weakness in 
Chad's public financial management -- lack of a competent, 
transparent mechanism to track all extractive-industry 
revenue sources, especially those derived from indirect oil 
production activities.  Direct revenues like royalties and 
some other payments were covered by Oil Revenue Monitoring 
Body, the so-called "College," set up IAW the GOC-World Bank 
agreements of 2002 and 2006. Although the World Bank has 
"withdrawn from the petroleum sector," the College remans 
charged by the GOC to monitor direct payments which 
constitute about a third of all revenues. The indirect 
revenues, however, especially taxe on profits nd other such 
sources, escape meaninful oversight, never having been 
covered by the ank-GOC agreement in the first place.  These 
indrect revenue sources now constitutetwo-thirds of Chad's 
oil revenues.  Desesquelles has proposed, and President Deby 
and PM Youssouf Saleh Abbas have accepted, Desesquelles's 
plan for the EU to fund ways to make the spending of all/all 
of Chad's oil revenues transparent.  Desesquelles said he 
 
NDJAMENA 00000510  002.2 OF 003 
 
 
would approach the IMF, the World Bank, and the European 
Investment Bank for assistance on this.  we noted that the 
College's President had told us that Deby had in January 
authorized the College to oversee and report on spending of 
both indirect and direct oil revenues, starting in 2009. 
Desesquelles sauid he woul be happy to work with the College 
as well. 
 
------------------ 
DEVELOPMENT ISSUES 
------------------ 
 
¶4. (C) On longer-range developmental issues, Desesquelles 
professed to be an optimist. He said the EU goal was to get 
the GOC to match EU spending in priority-sector projects 
heath, education, infrastructure (roads and potable water), 
and rural development in some meaningful portion -- say, 25 
percent to 50 percent of such projects.  The GOC performs 
better when it partners like this with a Western agency or 
organization.  Desesquelles said that he has President Deby's 
agreement to this EU-GOC partnership onndevelopment spending. 
 
¶5. (C)  Desesquelles said that sadly the biggest development 
obstacle was lack of human development in Chad, lack of 
skills, preparation, and expertise on the part of Chadian 
workers, technicians, administrators, etc. The GOC just did 
not have the work force capable of moving projects to 
fruition.  He noted that roads and water development were the 
two areas where tangible results could now be seen, but he 
added primarily because of an infusion of foreign expertise. 
He lamented the GOC's uncoordinated and unfocussed 
"scatter-shot" approach to development. There was no solid 
set of national priorities. And far too much authority was 
vested in the Ministry of Infrastructure, at least in part 
because physical engineering was easier than social 
engineering. We agreed, noting that key ministries, like the 
Ministry of Health, for example, had not yet seen much 
budgetary benefit from oil revenues lately. 
 
------------------------- 
THE ELEPHANTS OF ZAKOUMA 
------------------------- 
 
¶6.  (C) Desesquelles said that the EU was still deeply 
interested insaving the elephants of Zakouma Game Park, in 
southeast Chad. Most of the animal populations were thriving, 
he reported, but the elephant population was still at great 
risk from aggressive poachers.  Desesquelles said that he was 
working with the GIOC to reinforce security at the park, 
adding Chadian army troops to the Nomad Guard units already 
patrolling there.  He said he wa working as well on 
admittedly small-scale plans to increase visitors to the 
park. 
 
--------- 
COMMENT 
--------- 
 
¶7. (C) Desesquelles is energetic, active, and productive. He 
has recruited an impressive professional staff of about 
twenty and has additional experts placed in ministries as 
advisors.  As architect and champion of the Electoral Reform 
Process, he has the confidence of both ruling-party and 
opposition leaders.  He appears to have a pretty good working 
relationship with President Deby and is of course well-placed 
to keep a finger on the pulse of the development process. 
That he is willing to extend the EU's purview to responsible 
management of the GOC's oil revenues demonstrates both his 
understanding of the importance of the revenue-management 
issue but also the breadth of his commitment to putting the 
EU behind progress in this area, as in others, with resources 
and expertise.  Despite the efforts of Desesquelles and 
others, the average Chadian citizen has not yet come to 
believe that the government has a pro-development or 
pro-democracy agenda. Such attitudes may evolve if the 
democratic reform process ends in credible 2009 elections and 
if/when more of the bricks and mortar "partnership" projects 
Desesquelles described become more visible. 
 
¶8.  (C regime) We were a bit surprised at Desesquelles's 
linking of FORMIN Faki with Bachir and Younousmi, but 
consuming personal ambition long has been a leading 
motivation for Chadian political actors; there is no reason 
that Moussa Faki should be immune to its temptations. 
Younousmi, a Gorane, represents the continued strong if not 
decisive influence of Goranes in the Zaghawa-dominated Deby. 
 
NDJAMENA 00000510  003.2 OF 003 
 
 
 
NIGRO