Mega-dam to test AfDB’s will

Now gathered in Senegal, the African Development Bank hopes to emerge from its annual meeting as the premier financial institution leading the continent out of two major crises: the global financial crisis and the chronic underdevelopment of Africa’s infrastructure.

But the Bank’s consideration of Gibe III Dam in Ethiopia will test whether the Bank is really ready to lead Africa on the road to progress. Bank support for the € 1.55 billion dam would reward a closed-door contract process that can inflate prices, create poverty and enable corruption.

To make matters worse, support for the Gibe III Dam would fuel food insecurity and armed conflict in East Africa, and pave the way for future Bank involvement in low-quality infrastructure and corrupt mega-deals.

Bank support for Gibe III Dam would burden East Africans with a costly infrastructure scheme and tarnish the Bank’s reputation as a leader of Africa’s development.

Set to be Africa’s tallest dam, Gibe III was largely unknown during the first two years of construction until its scandalous details slowly came to light. The Ethiopian government pushed aside its own environmental, procurement and consultation requirements in order to fast track the project.

Bank funding would require the financial institution to overlook the Ethiopian government’s illegal actions. Ethiopians wishing to hold their government or the Bank accountable face a combined challenge of limited project information and fears of government retaliation.

The government’s intolerance for public debate deepened after the January passage of a new law criminalising human rights advocacy by most local NGOs.

Since the Bank began its preparation toward project funding, due diligence has been unacceptably poor and violations of Bank policy are mounting.

Bank funding would also violate the Bank’s procurement rules and send a dangerous signal to African governments that the Bank will support contracts awarded any which way, allowing corrupt practices to gain a further foothold in Africa’s lucrative infrastructure sector.

The project will severely affect one of East Africa’s most remote and neglected corners.

The isolated, local economy which depends on the lower Omo River and Lake Turkana is the only safety net for 500,000 farmers, herders and fishers. The Gibe III Dam threatens to destroy their livelihoods and the region’s natural resources, already under attack by climate change.

Filling the dam’s reservoir will drain Lake Turkana, the world’s largest desert lake, stressing its fragile ecosystem to the brink of collapse. The dam will also lead to increased food aid dependency and resource conflicts among the region’s many well-armed tribes.

This unravelling could destabilise the Ilemi Triangle, an isolated and highly volatile region where Ethiopia, Kenya and Sudan have disputed national borders for decades.

Ethiopia’s government is desperately betting on the Gibe III Dam as a new source of export revenues and to support its own electricity expansion.

But the prestige project will likely rebuild Ethiopia’s unsustainable debt faster than development. An assessment of the project’s costs and predicted revenues has still not been completed.