CENTER FOR INTERNATIONAL ENVIRONMENTAL LAW
ACTION ALERT AND UPDATE !!!!
WORLD BANK INSPECTION PANEL/RONDONIA CLAIM
On Thursday, January 26, the World Bank Board of Executive
Directors will meet again to discuss and vote on whether to adopt
the Inspection Panel's recommendation to authorize an inspection
into the Planafloro claim.
Bank Management has asked the Board not to authorize the
inspection on the grounds that recent and planned efforts by the
Bank will make the inspection unnecessary. The Bank also
presented a Status Report on the project and a proposed Action
Plan to "improve project implementation.
PLEASE SEND LETTERS to your Executive Directors asking that they
support a full investigation into the Rondonia claim. In the next
two days, CIEL will also be circulating a sign-on letter. The
letter will essentially make the same points discussed below.
Please let us know if you will sign on. We will circulate a draft
as soon as possible, but the turn- around time is short.
If you want a copy of Management's Status Report, please contact
CIEL although it is too long to fax.
ISSUES RAISED BY MANAGEMENT'S POSITION:
1. Management is clearly trying to circumvent the Panel
procedures by offering an Action Plan to the Board, before there
has been any independent investigation. In this way, Management
avoids any embarrassing oversight or findings.
2. Management's Plan was obviously in response to the claim and to
the Panel's initial recommendation that the Board authorize an
inspection. Yet, the Status Report does not relate any of its
proposed actions specifically to the claims raised by the NGOs.
There is thus no guarantee that the NGOs' claims will even be
studied, nor is there even an explicit effort to respond to the
serious and well-detailed allegations.
3. Although there are indications that Bank oversight of the
project has improved significantly since the claim was filed,
there have been two previous status reports issued by the Bank
that have not substantially improved implementation. There is no
reason for the claimants to believe that the outcome of this
status report and action plan will be any different, absent
involvement of the Panel.
4. As required by the Panel rules, the members of the NGO
Rondonia Forum already raised their concerns with Bank Management
before filing the claim. This gives management an opportunity to
fix the alleged problems. That might have been an appropriate
time for Bank Management to develop their action plan. Now that
the claimants have exercised their right to ask for an independent
and transparent review of the project, Management and the Board
should allow that process to work.
5. A decision by the Board to reject this claim will undermine
the Panel process. There is no substantive reason why an
inspection should not be authorized and indeed welcomed by the
Bank. Allowing Management to submit an undisclosed plan of action
as a way to avoid panel scrutiny will quickly cause the process to
lose credibility outside the Bank.
BACKGROUND
The following is some background information and several initial
concerns we have with the Bank's response to the claim;
The Planafloro project. With an initial budget of $228.9 million,
including a $167 million loan from the World Bank (Loan #3444-BR),
the Planafloro project aims to correct the serious problems that
occurred during the implementation of its predecessor, the
Northwest Brazil Integrated Development Program (Polonoroeste).
The basic objective of the Planafloro project is to promote a new
model of sustainable development in the State of Rondonia, through
a series of initiatives for the protection and management of
natural resources, such as socio-economic and ecologic zoning,
promotion of agroforestry systems, recovery of degraded lands,
environmental protection, creation and management of extractive
reserves and other conservation units, sustained forest
management, environmental education and support to indigenous
communities. Notwithstanding positive aspects of the loan's
goals, the record of implementation since the first disbursements
in June, 1993, has been terrible.
The Planafloro Claim. As a result, the NGO Rondonia Forum,
Friends of the Earth's Amazonia Program and 25 Brazilian
organizations, representing small farmers, rubber tappers,
indigenous communities, local rural unions, and environmental and
human rights groups, filed a claim last June. The 80-page claim
provides detailed documentation of the Bank's failure to supervise
implementation of the loan, as well as violations of several bank
policies and directives on: Forests, Wildlife, Indigenous Peoples,
Involvement of NGOs, Project Supervision, Project Monitoring and
Evaluation, Procurement and Suspension of Disbursement. The
overall goal of the Planafloro claim was to increase
accountability and improve implementation of the loan.
Management's First Response. Despite acknowledging that
implementation of the project has been seriously flawed, Bank
Management has continuously opposed the inspection. Its first
response to the claim raised six technical reasons why it opposed
the claim. The response showed an unnecessarily confrontational
and legalistic approach to a claim that was essentially trying to
put the Bank loan back on track. To some extent this reflected
Management's knee-jerk response to claims; the Planafloro claim
was the fourth claim filed with the Panel, and the fourth one that
Bank Management has argued should be ineligible.
The Panel's Preliminary Inspection. The Panel conducted its
initial review, including a review of Management's response and an
initial site visit, and concluded that all the allegations except
one addressing procurement issues fell within the scope of the
Panel's mandate and thus recommended a full inspection.
The Board's First Non-Decision. The Board of Executive Directors
first considered the claim in September. The Board's discussion
of this meeting was apparently very antagonistic to the claim,
although no technical or legal reason could be found to justify
denial of an inspection. A compromise was reached, whereby the
Board asked the Panel to provide more information regarding damage
to the claimants. At least some members of the Board apparently
argued that, because the Planafloro project was designed to help
the claimants, the claimants had not suffered any damage from the
failure to implement. The Board also apparently ordered Bank
Management to provide the Board with a Status Report.
The Panel's Second Submission. Apparently, the Panel submitted in
December a second report answering the question regarding damage
and once again recommending an inspection.
Management's Action Plan. More recently (on December 20), Bank
President James Wolfensohn forwarded a Status Report, including an
attached Action Plan, to the Board of Executive Directors. The
covering memo stated that in Management's view the proposed action
plan is sufficient to respond to the claim and that there is no
need to authorize a Panel inspection. The Status Report is very
detailed an
CONTACTS: David Hunter
Dana Clark tel: 202-332-4840 fax: 202-332-4865
email: cielus@igc.apc.org