The West sees Chad as a reliable ally in the fight against extremists in the African Sahel. But it needs to take more care. Chad is breaking prior agreements by spending much of its oil revenue on the military, while social services and good governance have suffered.
Chad is facing a severe fiscal and social crisis. On 7-8 September, President Idriss Déby is in Paris for an International Donor Conference to seek much-needed funding for the country's National Development Program. The government likes to portray the country's problems as due to external shocks like the drop in oil prices and the cost of military intervention against Boko Haram and other extremists. Donors, under pressure from France, largely accept this narrative and support has recently been forthcoming from the International Monetary Fund (IMF). But a closer look at the country's recent history tells another story.
According to the Chadian economy minister, the conference aims to mobilise support "for the transformation of Chadian economy". This is not the first time Chadians have been promised such a transformation. When Chad joined the club of oil-producing countries in 2003, the World Bank supported the building of the critical pipeline to get the oil to the coast on condition that the money generated would be put to good use. The Oil Governance Law was passed in 1999, stipulating that 80 per cent of revenues were to be allocated to pre-defined priority sectors - public health, social affairs, education, infrastructure, agriculture, livestock and water. Ten per cent of oil revenue was to be channelled into a fund for future generations, while another 5 per cent was earmarked for the oil-producing region. Only the remaining 5 per cent would flow directly into the state budget.
Soon thereafter, however, Déby started to dismantle these control mechanisms. In 2006, he amended the Oil Governance Law, dismantling the future generations fund and, crucially, adding defence to the list of priority sectors. He faced down donors and gradually rolled back all the control mechanisms so painstakingly negotiated by the World Bank, eventually gaining full discretion over spending of oil revenues.
This came about against the backdrop of mounting political and military opposition. The lack of political space, and in particular the constitutional changes in June 2005 that allowed Déby to run for a third term in 2006, led to the defection of senior political and military figures including his nephews Timane and Tom Erdimi. After a failed coup attempt on 14 March 2006, they established a rebel group, one of several rebellions to challenge Déby's power with the support of neighbouring Sudan. Major rebel offensives on N'Djamena in 2006 and 2008 nearly overthrew the regime.
Oil money gave Déby a critical lifeline. Free from any obligations of transparency, he awarded his supporters import licenses or public contracts for numerous infrastructure projects. To ease social tensions, the regime also recruited workers into the public sector. Oil revenues likewise enabled Déby to confront the armed opposition, through heavy investments in the army. Military spending skyrocketed from $67 million in 2005 to $247 million in 2006. Military expenditures reached an all-time high in 2009, accounting for $670 million - a full 8 per cent of GDP. Between 2006 and 2014, the regime purchased 139 aircrafts and 153 armed vehicles, turning its armed forces into one of the best equipped on the continent. After this splurge, military spending declined, but still remains way above pre-oil money levels at 2.6 per cent of GDP.
As in other African countries that have received significant Western support for their militaries, Chad's government is itself a product of a civil war and remains military at heart. So diverting funds to the army fits seamlessly with the government's own desire to reward its military and keep it loyal. Military spending has helped Chad intervene in the Central African Republic, Mali, in neighbouring countries threatened by Boko Haram and as far afield as the Saudi Arabia-led coalition to fight Huthi combatants in Yemen.
This engagement has strengthened relations with Western powers and brought substantial financial and political support. The EU, France and the U.S. in particular today consider Déby as their principal partner in the fight against terrorism in the Sahel. For Déby it is a win-win: tackle domestic armed opposition, pay his troops and gain significant leverage over donors.
But the rise in military spending along with mismanagement of oil revenues has come at a cost. Having failed to diversify the economy while the going was good, dependency on oil money has made the country highly vulnerable. Declining prices and production levels have led the country back to international donors. Partly as a requirement under the IMF financial and economic support program, the government has introduced drastic budget cuts, affecting allowances for civil servants, parliamentarians and police, student scholarships and the staffing size of state agencies. The government has accumulated arrears in payments of salaries, allowances and pensions.
This situation has caused waves of strikes by teachers and other public sector workers. Many feel that while they didn't profit from the oil revenues in the first place, they are now, on top of this, paying the price for its mismanagement. Widespread corruption, high living costs, and the lack of political space and civil liberties have further fed the anger and the country's growing number of protest movements.
The government has reacted with repression and a clampdown on civil liberties. Reports of harassment, arbitrary arrests, ill-treatment and torture of journalists, civil society activists and political opponents have increased. Unsurprisingly, international partners have been reluctant to denounce such practices, let alone impose conditions for their support. So even as Chad's economy nosedives in the context of corruption and authoritarianism, Déby's international position appears untouchable. Europe's increasing desire to get Sahelian countries to stop migrant flows from reaching the Mediterranean will likely give him a further opportunity to show how useful his country can be.
Chadian civil society activists and political opponents are increasingly frustrated with this unconditional international support for Déby, which they interpret as silent complicity. And understandably so: in backing Déby as he pours money into his military while the rest of the population suffers, Western powers are paying scant regard to the sustainability of their engagement, nor to what kind of state they are encouraging. The longer-term fight against extremism requires stronger and more legitimate public institutions, not "more strongmen".
While financial support for the fight against extremists in the Sahel is certainly an immediate priority, Chad's international partners should also extract real commitment to use part of international aid to support the country's crumbling social sectors, as well as to build new monitoring mechanisms to guarantee greater transparency.