NGO Comments ​on Safeguard Policies & Project Implementation

The World Bank's New Corporate Strategy:

Ignoring Lessons of the Past?

Public Interest Law Center (Chad)  - Urgewald (Germany) 

The new World Bank Group Strategy, which was approved by the governors of the World Bank Group (WBG) in October 2013, spells out how the institution is to meet its two newly set goals:  Ending extreme poverty by 2030, and promoting shared prosperity for the bottom 40% of people in a sustainable manner.

The central elements of the new strategy can be summarized as:

-- Working jointly across the World Bank Group, i.e. carrying out joint projects of the WBG's public and private sector agencies;

-- Using development assistance to leverage both public and private sector investment and enter into public-private partnerships;

-- Supporting transformational projects meant to fundamentally improve the lives of poor and disadvantaged people;

-- Taking on greater risks and manage risks "smartly" (without spelling out who is bearing the risks);

-- Develop mechanisms to monitor progress and outcomes of high risk projects.

These elements are not new.  All of them were present in one of the most paradigmatic projects supported by the WBG in recent times:  The Chad Cameroon Petroleum Development and Pipeline Project.  This meg-project with a total cost of over US$ 7 billion in one of Africa's most impoverished regions was meant to be "transformational."  Yet it led to increasing poverty and worsening governance conditions in Chad.  While the overall population is worse off, the affected communities in the oil-producing region have been left without land, water and freedom of movement. Before the project they were poor, now they live in a state of desperate destitution.

Although IBRD/IDA withdrew from the project in 2008 after the government of Chad anticipated repayment of the respective loans, IFC remained in the project until it was fully repaid in December 2012.  It is disturbing that there appears to be institutional amnesia on the impacts of this relatively recent and controversial project. 

World Bank President Dr. Kim is quoted in the New York Times as stating: "if you have a spectacular failure, the only thing that I would be disappointed about is if we didn't ensure we learned from that failure." Yet as this particular case illustrates, the WBG finds it difficult to undertake a more in-depth analysis of the causes of why an investment failed to reduce poverty and to draw lessons from what has been learned.

For more details:

The World Bank's New Corporate Strategy: Ignoring Lessons of the Past?    Public Interest Law Center, Chad; Urgewald

La nouvelle Stratégie du Groupe de la Banque Mondiale: Ignorance des leçons du passé?