Albion Monitor /News

World Bank, Others Keep Enviro Problems Secret

by Abid Aslam

"Inconsistencies and gaps" in efforts to assess likely environmental impacts
(IPS) WASHINGTON -- Secrecy and lax environmental screening of projects plague the World Bank and its regional counterparts despite a six-year U.S. government push for environmental accountability, says the research wing of Congress.

The multilateral development banks (MDBs) remain dogged by "inconsistencies and gaps" in their efforts to assess the likely environmental impact of proposed projects and to share this information with the public, including the people likely to be affected by the projects, according to a report from the Congressional Research Service (CRS).

The U.S. government itself has failed to fulfill obligations to make information public, CRS adds in its evaluation of the impact and implementation of legislation at the center of the U.S. campaign.

In many cases, the studies "may overlook factors such as 'downstream' impacts that are not directly connected with the viability of the project itself"
In 1989, Congress passed legislation that included a provision known as the Pelosi Amendment after its sponsor, Rep. Nancy Pelosi, a Democrat from California. The law took effect in 1991 and requires the U.S. executive directors of the MDBs to abstain from voting, or to vote no, on any project likely to have significant environmental impact if it has not been properly assessed, or if the assessments have not been made public at least 120 days before a vote.

"Environmental assessment and information access procedures have been adopted and put into practice by all the major MDBs, due in large part, most observers agree, to the Pelosi Amendment," the report says. The agencies include the World Bank and its private-sector affiliate, the International Finance Corporation, the African Development Bank, the Asian Development Bank, the European Bank for Reconstruction and Development, and the Inter-American Development Bank.

But the report highlights "major gaps in the analysis of impacts, overly rapid appraisal techniques for large projects...(and the) use of outdated material and poor data bases." In many cases, the studies "may overlook factors such as 'downstream' impacts that are not directly connected with the viability of the project itself."

Studies "frequently are not available in time and/or are not used in project design and decision-making," CRS adds. Environmental assessments "are often conducted in relative isolation from project preparation, and frequently have not been used appropriately -- or at all -- in project design."

Most of the MDBs sort project proposals according to the likely severity of environmental impacts. Since only those in the higher categories receive close scrutiny, project supervisors sometimes try for a lower classification in order to skirt the requirements, the report says. To solve this problem, the Inter-American Development Bank has done away with categories, a move that ultimately may make it easier to hide troublesome proposals from the agency's board by lumping them in with all the others, CRS warns.

Environmental information is much more available now than before the legislation took effect, the report says. But the information often does not reach the public "in the early stages of project development, when key decisions are made," the report says.

CRS has few kind words for any of the banks. It scolds them all for failing to live up to their own promises on public information disclosure, noting that most either suppress entire documents or keep descriptions of proposed projects -- and sometimes even those that have been approved -- as brief and vague as possible.

The Congressional researchers single out the International Finance Corporation for handing responsibility for environmental assessments to project sponsors and for keeping these and other documents secret even after projects have been approved. They note, however, that agency officials say that they must play by the rules of the relatively secretive private sector because their clients are private companies, not countries.

Training its sights on Washington, CRS says that although the U.S. government reports to Congress every three months on how its representatives voted on the MDBs' boards, Congress does not normally publish this information. Yet, "there is no comparable method for informing the public about U.S. votes in the (MDBs) apart from the information provided to Congress."

Similarly, "annual reports to Congress and the public, required by law, have not been filed for several years."

Were the reports made public, they would show that the U.S. executive directors invoked the Pelosi Amendment and voted against proposed loans more than 100 times between 1992 and 1996, and that "projects opposed by the United States virtually always win approval," according to CRS.

The report acknowledges environmental "interest and concern" among other countries' executive directors, but says "this results mainly in the queries about projects before they come to a vote rather than opposition during the voting itself."

Unwillingness among board members to authorize full-scale probes of agency operations
Although some questions are discussed before formal board meetings, "ultimately, environmental and social issues simply don't get the weight they deserve when they come before the executive directors," says David Hunter, vice president of the Washington-based Center for International Environmental Law.

The Center is among non-governmental organizations here and in developing countries that for years have lobbied the Bank's directors on broad environmental issues and specific project proposals.

"When you finally do get through to one or two, the culture of the board, which emphasizes consensus, means they'd rather skirt these issues than address them head-on at board meetings," says Hunter, adding that U.S. executive directors have needed as much goading as have the representatives of other countries.

Nevertheless, CRS argues, the Pelosi Amendment "can be said to have helped sensitize the MDBs...and to have stimulated extensive examination of projects." And despite their flaws, environmental assessments are useful in documenting the need to mitigate likely problems and providing a basis for environmental measures to be written into loan agreements.

The studies also help to pinpoint failures when projects go bad, CRS adds. Some MDBs have independent grievance departments to look into such cases. But even the most prominent of these, the World Bank Inspection Panel, has been held back by an unwillingness among board members to authorize full-scale probes of agency operations, as Bank, non-governmental organizations, and Panel sources have told IPS.

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Albion Monitor September 22, 1997 (

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