Published in Aktuelt (Denmark)

June 17-18, 2000

Posted at willum.com

 

 

WORLD BANK AWARDS ILLEGAL FINANCING OF ARMY

Uganda Encouraged to Pillage Congo

 

 

 

Uganda resorts to extra-budgetary financing of its military by plundering gold- and diamondmines in neighboring Congo.

The World Bank, however, claims that Uganda is living up to donor conditions of not spending more than 2 percent of the country's Gross Domestic Product on the military.

Therefore Uganda has become the first country in the world to be nominated for debt relief amounting to 2 billion dollars.

By Gunnar Willum and Bjørn Willum

 

 

 

The World Bank and Western donors are so desperate to have success with a new debt relief program, the Highly Indebted Poor Countries (HIPC) Initiative, that they prefer to tolerate Ugandan financing of its army through plunder in Congo rather than to present the real figures.

And the figures in the World Bank reports do indeed look good.

High economic growth rates, rising exports and almost no military expenditure, despite the fact that Ugandan Government has occupied huge parts of neighboring Congo and fights rebels in the northern part of the country.

Last month the east African country was then awarded by the World Bank and the International Monetary Fund (IMF) who promised debt relief of almost 2 billion dollars through the Highly Indebted Poor Countries intiative, which has been praised by development organizations and scholars all over the world.

But the numbers lie. Uganda's military budget is in reality far larger than stated in the official statistics.

"Uganda makes a million dollars a day pillaging gold and diamonds in Congo," a World Bank source, who asked not to be named, told Aktuelt.

The income associated with plunder of valuable minerals in Congo directly benefits the military and lines the pockets of officers. It does not figure on the state budget, says William Reno, a scholar on Africa from Northwestern University in Chicago.

Uganda thereby circumvents the donor demand not to spend more than two percent of its Gross Domestic Product on the military.

Gold Export

However, the pillage of Congo is not exclusively a gain for the military and the officers profiting on the smuggling.

Gold, diamonds and other valuable minerals are shipped to Uganda from the mines in the parts of eastern Congo controlled by the Ugandan army. The gold is then bought by private companies and exported once more, this time from Uganda, thereby improving the balance of payment.

Gold has become the second largest export earner after coffee bringing in more than 100 million dollars a year, according to the latest government statistics.

Adding another good mark to Uganda's economic performance in the eyes of the donors.

William Reno rejects the notion that the World Bank should be unaware of the origins of the gold and where the money from the illegal trade is going.

"They should be imbeciles not to know what is going on. But they don´t care. Any geologist knows that there isn´t gold in those amounts in Uganda," he says.

The smuggling is no secret for the government, nor for the donors or the monetary institutions. "Gold is being smuggled into Uganda," the IMF concluded in an official report from October last year, adding in the same sentence that "Uganda does not produce gold."


          'As a World Bank official I cannot discuss these things'

          Anthony Gaeta from the Bank's HIPC Initiative division


But the World Bank deliberately chooses to ignore this "extra appropriation" to the military in order for the books to balance and get the enormous debt relief programme running.

"As a World Bank official I cannot discuss these things," says Anthony Gaeta from the Bank's HIPC Initiative division to Aktuelt.

The World Bank is more interested in making the figures on the bottom line look good, since billions of dollars have been invested in the country, critics say. The actual military expenditure is ignored.

"It´s a technical desire achieve balance of payment," says William Reno.

Awarded

Uganda has in other words been awarded for waging war in Congo despite the official rhetoric from both the World Bank and the European Union, who have repeatedly called for Uganda to withdraw from the Congo according to a peace agreement reached last year between the warring parties.

"Therefore you can say that the donors and the World Bank is supporting Uganda's war in Congo," says Reno.

The price is being paid by Congolese civilians. Not only are the resources of their country being plundered, the human suffering is enormous. According to Amnesty International the Ugandan occupation forces have participated in massacres and raping of civilians.

According to a recent report released by an American relief organization the number of deaths caused by the war has reached 1,7 million.

But according to one Western government source the World Bank desperately needs to use Uganda as a model country and therefore refuses to face the reality, because it wants success with the HIPC Initiative. No matter what the price.

"The World Bank wants Uganda to be Africa's success story," the government official says. .

 

 

THIS ARTICLE WAS REPUBLISHED BY THE MONITOR IN KAMPALA:
Uganda 'Plunders' DRC, Rewarded by World Bank