Source:
International Rivers Network
The World Bank decided to increase funding for infrastructure projects in an Infrastructure Action Plan (IAP) that
was adopted by the Board of Directors in July 2003. Now it is time for civil society to examine how the new Action Plan is being implemented. This report looks at whether the World Bank incorporates the lessons of the past and current best practice guidelines as it implements the IAP. PDF format.
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The World Bank's original focus was on microeconomic projects, such as dams or pipelines that were supposed to trigger macroeconomic development in a wider region. This role shrank when the Bank became more and more involved in long-term development and poverty reduction. However, project lending still dominates the World Bank’s budget.
As projects such as hydroelectric dams are highly visible and often controversial they started to gain attention from NGOs as early as the 1960s. The benefits of large dams, for instance, are disputed because the gain in electrical power is often paid for with massive displacements of local population and environmental damage. The World Bank is the largest single source of funds for major dam projects worldwide. Civil society movements which oppose large dams often target the World Bank as its loans and conditions determine the outcome of the project. NGOs successfully forced the Bank to pull out of the Narmada Dam project in India in 1993. This resulted in an even bigger movement of affected villagers, grassroots activists and international groups questioning the World Bank's involvement in large dam projects. In 1994, in the so-called Manibeli Declaration, a coalition of NGOs demanded an immediate stop to all World Bank dam funding. In 1995 citizen action forced the World Bank to withdraw from the Arun III Dam in Nepal. Since then the Bank has constantly reviewed its dam policy and funded less mega-projects. However, in 2003, the World Bank adopted a new water strategy which again focuses on large dams as a source of sustainable energy. Subsequently, it was criticized by NGOs for revitalizing failed policies of the past.
The role of the World Bank in the oil, gas, and mining industries is at least as disputed as its policy regarding dams. The Bank believes that the extractive industries can make a significant contribution to sustainable development, provided that environmental and social matters are considered. However, NGOs argue that the Bank fails to taking into account the concerns of the affected populations and mainly serves the interests of foreign multinationals. As result of decades of civil society pressure, the World Bank agreed to review its extractive industries’ policy in 2001. The final report, published in December 2003, condemns the role of the World Bank in oil, gas, and mining projects and demands far-reaching reforms. While the paper is currently under discussion at the World Bank, NGOs are demanding the implementation of the proposed reforms.
As with dams and the extractive industries, World Bank policies regarding forests are criticized for exploiting natural resources at the cost of the local population and the environment. The World Bank regards forests as an important source of income for some of the poorest countries in the world which lack other resources. Civil society groups, in contrast, defend the rights of indigenous people living in and depending on forests. Moreover, they emphasize the important role of forests in the global environment. In 2002 the World Bank approved a new forest strategy which is said to balance economic and environmental interests in the use of forests. NGOs quickly pointed out that the new strategy is open to interpretation regarding essential questions and civil society participation remains weak.
Every World Bank project has to go through a project cycle. Before individual projects are assessed the Bank prepares a Country Assistance Strategy (CAS), in which the general development strategy is laid down. During the identification phase, the Bank and the member government identify projects which can be funded as part of the agreed development objectives. When a project is identified as suitable for World Bank lending it enters the appraisal phase, where technical, institutional, economic, and financial assessments are made. Then, the details of the project are negotiated between the Bank and the country government and approved by the Bank’s Executive Board. The implementation is mainly the borrower's responsibility. However, the Bank may provide assistance and supervises the realization of the project according to the agreement. Finally, the project is evaluated by the Bank’s staff and its OED. Despite this sophisticated system many Bank projects fail, not only according to civil society groups, but also according the World Bank's own evaluation.
The World Bank's main self-proclaimed objective is to eradicate poverty. Yet, evidence suggests that its programmes often harm the poor and the environment.
This factsheet on dams includes examples from Bank-financed projects in Argentina, Guatemala, Lesotho, Uganda and India. It lists the Bank's failures in terms of providing the local population with adequate compensation, environmental damages caused, and financial disasters involved.
This report concludes that many large dams are uneconomical, even before accounting for their social and environmental costs. In general, they benefit those who are already well-off, while the poorer sectors of society have borne the costs. The Commission recommends giving social and environmental aspects the same significance as technical, economic and financial factors in decision-making on such projects (pdf format).
Large dams often involve the resettlement of many people. This report from the Bank's Operations Evaluation Department concludes that countries should treat resettlement as an opportunity, and guarantee economic prospects for the population at their new settlements. Involvement of NGOs enhances the chance of successful implementation. The Bank has to improve monitoring and evaluation of resettlements.
In this January 2003 strategy paper, the World Bank argues that water resources management and development are central to sustainable growth and poverty reduction and therefore of central importance to the mission of the World Bank. The Bank needs to assist in developing and maintaining well-performing hydraulic infrastructure and in mobilizing public and private financing while ensuring social and environmental standards. It will reengage with high-reward, high-risk projects (pdf format).
By supporting mega-projects the new World Bank water strategy revitalizes the failed policies of the past. Funding for large dams had been rightly abandoned for their negative environmental and social impact. The new policy also contradicts earlier promises of adopting the recommendations made by the World Commission on Dams. While pretending to help the poor, encouraging privatization of water supplies means that people in rural areas will be deprived of clean water as they do not represent an important enough market for commercial interests.
World Bank Watch is a project of Public Citizen which monitors World Bank proposed loans in the water and sanitation sector that contain privatization and cost recovery policies. The Bank continues to push these measures despite evidence that increased cost recovery and privatization reduce access, raise the price of water for the poor, exacerbate inequities, and reduce local control. Regular updates on projects from around the world.
The World Bank has been the largest single source of funds for large dam construction worldwide. Under its stated aim of alleviating poverty, it has promoted and funded dams that have displaced more than 10 million people from their homes and land, caused severe environmental damage, and pushed borrowers further into debt. Dam-affected communities from all over the world demand reparations for the continuing damage to their lives because of dams which have already been completed.
The environmental and social costs of World Bank-funded large dams, in terms of people forced from their homes, destruction of forests and fisheries, and spread of waterborne diseases, have fallen disproportionately on women, indigenous communities, tribal peoples and the poorest and most marginalized sectors of the population. This is in direct contradiction to the World Bank's often-stated "overarching objective of alleviating poverty”. The World Bank has to date been unwilling and incapable of reforming its lending for large dams, therefore the NGOs call for an immediate moratorium on all World Bank funding of large dams.
An international fact-finding mission visited Ghana to assess the privatization of the water system. It found that the World Bank’s involvement in the privatization process could not prevent the deterioration of an already insufficient water system. Sustainable water supply for large parts of the population is endangered.
This brief description of the project cycle also identifies how local populations affected by the project, along with international NGOs, can intervene in the process.
Each World Bank project has to go through a project cycle, starting with the outline of a general strategy and ending with an evaluation. This document is a detailed description of the project cycle, including links to relevant documents.
The World Bank released its second annual report on implementing the Management Response to the Extractive Industries Review (EIR). The EIR was an independent evaluation of the World Bank’s support for the oil, gas and mining sectors. February, 2007
The Extractive Industries Review (EIR) final report was particularly critical of the World Bank's role in policy reforms in the extractive industry sector, which have led to negative impacts on communities, the environment and human rights abuses. September, 2004
The report describes global and local resistance to large-scale oil, gas and mining projects funded by international financial institutions, and exposes the impacts of mining code reform through eleven case studies. Cases include the Chad-Cameroon and Baku-Ceyhan oil pipelines, and projects that are under consideration at financial institutions, including a major copper mine in Laos (pdf format).
An activist from the Centre for Environment and Development in Cameroon evaluates the World Bank involvement in the Chad-Cameroon oil pipeline. The Bank promised to watch social and environmental standards, but it achieved only damage control, not the positive objectives of its operational policies and directives. Monitoring mechanisms are inadequate and failing. Three-quarters of the profits will go to the private consortium, while the local population faces the destruction of drinking water springs and rising inflation.
This case study by the Center for Environment and Development in Cameroon demonstrates the environmental and social damage of the Chad-Cameroon oil pipeline on the local population. It concludes that, if the World Bank cannot deliver poverty alleviation in its model project, it should withdraw from oil projects altogether (pdf format).
This World Bank-funded report is the result of a two-year-long evaluation of the Bank’s support for extractive industries in developing countries. It concludes that, in general, Bank projects in this sector are incompatible with its environmental and social objectives. The report's wide-ranging recommendations include that the Bank phase out its support for oil projects by 2008 and instead invest in sustainable energies (pdf format).
This site collects the views of civil society groups on the EIR process and final report. It contains information on the impact of World Bank investment in the extractive industries on people and the environment, and formulates alternatives. The NGO coalition demands that the World Bank take the findings very seriously and implement all the recommendations. According to them, a failure to implement the EIR recommendations will be regarded as a failure of the World Bank to act in good faith.
This study reveals that many energy corporations facing government investigation in the US and elsewhere have leveraged billions of dollars in World Bank Group financing over the past decade. Out of the top 15 corporations involved in the World Bank energy and power sector over the past 10 years, most are being investigated for alleged accounting irregularities, energy market manipulation, fraud, bribery, human rights abuses, or other practices (pdf format).
FPIC is integral to industry’s stated need to obtain a ‘social license’ to operate. Without substantial agreement by affected persons, communities and indigenous peoples, social license cannot be obtained and industry will be operating in contravention of its own principles.
This report explores the World Bank's support for extractive industries (oil, gas, and mining) in Africa over the last 20 years in light of the its self-proclaimed mission of poverty reduction. It describes the obstacles to using extractive industries as a vehicle for poverty alleviation and sustainable development, and poses a series of research questions related to the role of the World Bank in extractive industries.
Comment on the Banks’ financial support for the Baku-Tbilisi-Ceyhan pipeline. While the immediate outcomes included overruling national legislation, running the pipeline within protected areas, threats to human livelihood as well as increased dissatisfaction and strikes of local communities, the long term economic and environmental impact will most likely undermine sustainable development in the region.
Although forests continue to disappear at an alarming rate, the World Bank keeps on implementing structural adjustment programmes that contribute to deforestation in countries such as Brazil, Indonesia, and Cameroon. Environmental protection remains a “soft" condition, where the Bank turns a blind eye if not complied with.
In October 2002 the World Bank approved a new forest policy that helps to reduce poverty without jeopardizing environmental sustainability. To reach this goal the World Bank supports harnessing the potential of forests to reduce poverty, integrating forests into sustainable economic development, and protecting vital local and global environmental services and values (pdf format).
This article summarizes the criticism made by NGOs of one of the first pilot projects using the World Bank's climate change carbon trading programmes. According to local civil society groups, the project in Brazil is endorsing destructive tree plantation, while is intended to contribute to carbon dioxide emissions reduction and to more sustainable pig iron production. Campaigners, however, state that the project will harm the local environment and livelihoods and set a precedent for projects with dubious climate change benefits.
This factsheet highlights how the Bank contributed to the destruction of the World’s rainforests in the 1980s. In Brazil it financed an access road allowing the clearance of the forest for cultivation, in Congo it indirectly supported illegal lodging in a national park, and in Indonesia it provided loans for a transmigration program that resettled 3.6 million people in areas covered by virgin forests.
The World Bank policy on forests is now meant to prevent all Bank operations from causing 'significant' damage to 'critical forests'. NGOs are concerned that lack of clarity, about how much damage is 'significant' and in the definition of 'critical' forests, will allow many destructive projects to go ahead. The lack of effective safeguards to protect the rights of forest peoples is another major NGO concern. This briefing serves as a guide to the policy in form of FAQs and an overview presenting NGO proposals and final World Bank decisions on a number of different subjects.
This report examines the World Bank’s track record of “High-Risk” projects in the dam, oil, gas, mining, and forestry sectors. It concludes that the Bank has not learned from past mistakes. Its projects still impoverish millions of people and cause environmental disasters. The new projects will encounter greater resistance by local communities and international NGOs as civil society is better organized than ten years ago (pdf file).
The World Bank decided to increase funding for infrastructure projects in an Infrastructure Action Plan (IAP) that
was adopted by the Board of Directors in July 2003. Now it is time for civil society to examine how the new Action Plan is being implemented. This report looks at whether the World Bank incorporates the lessons of the past and current best practice guidelines as it implements the IAP. PDF format.
