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World Bank Board of Directors Approves Management's Response to Inspection Panel Report on Chad-Cameroon Pipeline Project


L. Joseph
Phone:  (202) 473-7700

Fax:  (202) 974-4384

E-mail:  
ljoseph@ifc.org


Washington D.C., September 12, 2002—The Board of  Executive Directors of the World Bank today approved Management’s response to a report by the institution’s independent Inspection Panel on three projects in support of the Chad Petroleum Development and Pipeline Project.  During its discussion, the Board commended the work of the Inspection Panel as well as Management’s action plan, and voiced strong support for the project and its focus on poverty reduction.

The Inspection Panel is an important instrument contributing to project quality.  The findings of the Panel will lead to improvements in the ongoing implementation of this challenging project, which has enormous potential to bring great benefits to the people of Chad and Cameroon,” said World Bank President James D. Wolfensohn.


The Management action plan to address the Panel’s findings focused on four areas: environmental and social compliance with the Bank’s policies and procedures; economic issues; poverty reduction issues; and monitoring and supervision.  Key elements of the Management response include:


·Environmental and social compliance.  The Bank will work with the relevant Chadian agencies to prepare the Regional Development Plan (RDP) that will be developed as part of the Environmental Assessment (EA) and Environmental Management Plans (EMP).  The EA and EMPs (English and French) were developed as part of the project’s preparation. The RDP will address the concerns about the project’s cumulative regional impacts raised by the Panel.


·Economic benefits.  By law, more than 80 percent of the oil revenues accruing to the Government will directed to expenditures in the priority sectors of health, education, rural development, infrastructure, environment, and water (and 10 percent will be saved in a fund for future generations). The oil-producing region will receive 5 percent of these resources to be managed locally, in addition to what it will receive through the national budget. The action plan will accelerate efforts to strengthen the capacity of Government to manage these expenditures and to effectively monitor oil quantities produced and revenues generated.


·Poverty reduction impact.  Oil revenues are eventually expected to more than double government revenues; therefore, the challenge of securing the maximum poverty reduction impact from these resources is substantial.  Management places the highest priority on assisting Chad to achieve its poverty reduction objectives through this project and through the other elements of its assistance to Chad.  The action plan provides for continuing and intensifying supervision of and assistance for the Government’s capacity-building efforts to account for oil revenues and address environmental and social aspects over the life of the Project.  It also prepares for Government spending in priority sectors and allocates and commits these revenues in a publicly-transparent manner.


·Monitoring and supervision.  The action plan maintains the Bank’s commitment to intensify monitoring and supervision of the project.  Since the June 2000 project approval, exceptional resources have been allocated by the Bank, and IFC in this instance, to monitor and support the project’s  implementation.  The Bank Group's reinforced supervision and monitoring capacity complements the independent monitoring and assessment conducted by the International Advisory Group (IAG) and Environmental Monitoring Compliance Group (ECMG), which have been regularly conducted since Board approval.


The Inspection Panel is an independent entity within the World Bank that reports directly to the Board of Executive Directors.  Its mandate is to ascertain, in response to requests related to specific projects, whether the Bank has complied with all applicable policies and procedures with respect to project design, appraisal, and supervision.


For the complete Inspection Panel Report, and the World Bank Management Report and Recommendations in Response to the Inspection Panel Report, go to :


World Bank project website :  
www.worldbank.org/afr/ccproj
Inspection Panel website :  
www.inspectionpanel.org
IAG-GIC website :  
www.gic-iag.org