Banks accused of 'financing' genocide.

Author:Misser, Francois

According to a team of European and North American financial experts, the World Bank and some European banks might have inadvertently financed the genocide that took place in Rwanda. Calls for compensation and a freezing of Rwanda's debt repayment are now being made. FRANCOIS MISSER examines the evidence.

The international storm generated by the disclosure of the 'Nazi gold' extracted from Jews during World War II and deposited in Swiss banks, had hardly died down when a team of European and North American financial experts handed over a confidential report, whose contents could prove to be just as explosive to the Government of Rwanda.

The team had been commissioned to do nothing more than work out a formula to alleviate the country's debt burden but when it began to dig into the country's finances in Kigali, it came to the startling conclusion that the issue was less about Rwanda's repayment of the debt than the international bankers' 'moral obligation to pay compensations for the genocide'.

Elaborating on this grim discovery, the Belgian economist, Mr Pierre Galand, a member of the group, said the Rwandan debt, worth around $1,000m, is 80% owed to multilateral institutions such as the World Bank, the IMF and the African Development Bank. Documents found at the Banque Nationale du Rwanda (BNR) and at the Finance and Planning ministries show that most of these amounts consist in balance of payment support and quick disbursements to the State of Rwanda during the 1990-1994 period.

During this time, while the internal political crisis in the country was escalating, the World Bank had maintained its classical list of items, such as weapons, gold and nuclear products which Rwanda was prohibited from importing using such funds. However, according to Mr Galand, the World Bank failed to pay enough attention to the fact that these funds were being "merged" with other resources and that more than half were used by the Government to purchase military equipment; among the items purchased were the machetes used by the authors of the 1994 genocide.

Mr Galand admits that the World Bank did express, on several occasions, its concern over the excessive amount of military expenditure to the Government of Rwanda, but the Belgian economist also points out that neither the World Bank nor the other donors took any steps to sanction such purchases. That there was room for sanctions is revealed by the World Bank's own audits which lists a catalogue of fund...

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