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Contributions from
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Facts and trends
World Bank Board endorses
management response
A parliament for Somalia
Common Code for the
Coffee Community
Corruption: World Bank sanctions Acres Ltd.
Development policy
and terrorism
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Lending guidelines overhauled
Wieczorek-Zeul pledges
German assistance
Bad marks for the IMF
10/2004
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[ Extractive Industries Review ]
World Bank Board endorses
management response
After consultations in early August, the World Bank’s Executive Directors welcomed the management's response to the Extractive Industries Review (EIR), describing it as “balanced”. On some points, Executive Directors asked the management to refine the language of the statement before giving their final endorsement. After the Board meeting, World Bank President James Wolfensohn said this did not mark the end of efforts to improve World Bank investment in primary production. On the contrary, the Bank would continue to cooperate with governments, the private sector and civil society to socially and environmentally improve Bank funded projects.
According to the chairman’s summary of the directors' meeting, there were marked differences of opinion on a number of matters central to the EIR. These included issues such as how strongly the World Bank should engage in oil and coal investments in the future and how much importance should be attached to “good governance” as a condition for projects in the extractive industries sector. Some directors felt minimum standards of good governance needed to be met; others took the view that criteria should not be too strict as this would disadvantage countries with weak government structures.
Furthermore, some directors argued that the consent of the people living in a project area needed to be obtained before a project starts (free prior informed consent). This requirement had been called for in the Extractive Industries Review but was clearly rejected in the management's response, which merely agreed on discussing with local communities more thoroughly in the future. Some directors who shared the management's view argued that the EIR requirement was inconsistent with the World Bank's Articles of Agreement.
In contrast, the head of the EIR Commission, former Indonesian environment minister Emil Salim, criticised the World Bank's negative attitude on this issue. Commenting on the management's response to the EIR, Salim said approval of projects with major implications was an internationally guaranteed right of indigenous groups. Overall, Salim was disappointed in the World Bank response and echoed the criticism levelled by NGOs that the announced reforms are half-hearted. The World Bank claimed to agree with the majority of the recommendations of the EIR, he said, but it made few commitments to implementing them. (ell)
Further information:
World Bank:
http://www.worldbank.org/ogmc
Extractive Industries Review:
http://www.eireview.org
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