History of the world economy
Date: Sat, 14 Jan 1995 03:37:44 GMT
From: Rich Winkel (rich@pencil.cs.missouri.edu)
Organization: PACH
Subject: SIERRA CLUB CHARGES WORLD BANK WITH VIOLATING
ENVIRONMENTAL POLICIES
To: Multiple recipients of list ACTIV-L
(ACTIV-L@MIZZOU1.missouri.edu)
Sierra Club Charges World Bank with Violating Environmental Policies
FOR IMMEDIATE RELEASE January 9, 1995
FOR MORE INFORMATION
CONTACT: Stephen Mills (202) 675-6691 or Roni Lieberman (202)
675-7903
Washington, D.C.... Citing recent reports which reveal
the World Bank's attempts to conceal investigation results of a proposed
venture in Nepal, the Sierra Club today called for the colossal Arun Dam
project to be canceled, and for smaller, less environmentally
destructive projects to be considered.
The Sierra Club is supporting Nepalese environmentalists who
believe that the Bank is pressuring their government to sign off on the
$764 million project in an attempt to circumvent the World Bank's
Inspection Panel findings and to preempt a comprehensive investigation.
The World Bank, Asian Development Bank and several bilateral aid
agencies are proposing to finance the million-dollar project, costing
more than Nepal's entire annual budget, in an isolated,
biologically-rich and ethnically diverse mountain valley near the base
of Mt. Everest.
"This dam represents precisely the kind of foreign aid rat hole that has
caused some members of the new Congressional leadership to support sharp
reductions in U.S. contributions to the World Bank," said Stephen Mills
of Sierra Club's International Program. "One would think that after
years of local and worldwide opposition to such environmentally
destructive projects that the Bank would have learned a few things.
Maybe 50 years is enough," continued Mills, referring to World Bank's
1994 50-year anniversary.
Nepalese citizen organizations have proposed a more sustainable
approach to hydropower development, based on local knowledge and
indigenous capacity. This alternative approach is based on
decentralized, smaller-scale hydropower development, and emphasizes
public participation and practical projects that take advantage of local
knowledge, skills, materials, and equipment. This approach would result
in much greater social and economic benefits for the Nepalese, while
providing sufficient electricity for the country, starting with those
who need it most in rural areas.
On December 20, 1994 World Bank management issued an internal
update to staff which stated that the Bank's internal Inspection Panel
"does not recommend that further work be done on exploring
alternatives". The memorandum directly contradicts a December 16
Inspection Panel report which found policy violations in the Bank's
alternative project evaluation.
The panel memorandum clearly states that the World Bank has not
demonstrated "that equivalent levels of effort were devoted to an
alternative economic analysis," and that there was an "absence of a
close examination of alternatives." "For Bank management to come into
compliance with its own policies, a full investigation of viable
alternatives must be a part of the project analysis," said Mills.
The World Bank has a long history of excluding indigenous
people, non- governmental organizations, local experts and government
officials from its decision-making process. In this case, the Nepalese
government, which is still prepared to consider alterative energy
projects, has repeatedly asked the Bank for more time to review the
project proposal. The Bank is unyielding and is pressuring the Nepalese
government to immediately indicate whether it wants to proceed.
Last year in an effort to further reform the lending practices
of the Bank, Rep. Barney Frank (D-MA) former Chair of the House
Subcommittee with jurisdiction over development banks, insisted on an
exchange. In return for U.S. funding of the World Bank's International
Development Assistance fund (IDA), the Committee required the Bank to
increase its "transparency" or openness to public review and to create a
new independent inspection panel to review controversial projects.
"The World Bank is attempting to subvert the work of its own
panel. A unanimous Bank board vote is required for an inspection to
even occur," said Larry Williams, Director of Sierra Club's
International Program. "These guys aren't even willing to play by their
own rules when the risk is they may lose one of their pet projects," he
continued.
"This represents the antithesis of sustainable development: a
mega-project in a small country for the benefit of a small urbanized
elite of industry, government officials and foreign contractors," said
Mills. "In Nepal, the rural taxpayers and the environment will bear the
burden."
Approximately 450,000 people from 10 ethnic groups would be
adversely affected if the project is funded. The Arun III hydroelectric
project will also directly impact the area's forests and wildlife
because the forests surrounding the site would be cleared. A Nepalese
NGO, the King Mahendra Trust has said that total deforestation is likely
to occur in the Arun basin in less than 15 years because new roads would
make access to the forest easier. And the World Bank itself recognizes
the dam will block the movement of migratory fish, although no studies
have been done regarding those impacts and the economic and social
implications.
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