New report on problems with forest policy reform

15 June 1999

The World Rainforest Movement and Environmental Defense Fund have produced a briefing on the World Bank’s Forest Policy Review and Strategy Development process. It explains:

“The World Bank is conducting a review of how its 1991 Forest Policy is being implemented. At the same time it is developing a new strategy to guide its future investments in forestry. It would be far more logical if the Review preceded the development of a new strategy.”

The authors argue that the Bank’s Forest Policy is important because:

  • the Bank is the largest source of development finance and investments in the forest sector;
  • its policy is used as a model for other aid agencies, and;
  • it covers all types of World Bank Group activities, not just in the forest sector.

The Forest Policy was established as a result of controversy and outside pressure. A previous review in 1994 failed to look at the impact of Bank loans in all sectors which affect forests, the Bank’s incentive system or the social impacts of loans which affect forests.

Many Bank staff aim to lift the prohibition on Bank funding of logging in primary moist tropical forests, and support constructive engagement in certification and community forestry.

Due to NGO complaints, the review is now being carried out by the Bank’s semi-autonomous Operations Evaluation Department, and a number of outside experts have been asked to write papers to help guide discussions at the regional consultation meetings in the second half of 1999.

EDF and WRM complain that the review will not include participatory field studies of Bank projects and will not address:

  • tree plantations (likely to make up more of the portfolio given the Bank’s enthusiasm for the Clean Development Mechanism and joint implementation of the Kyoto protocols;
  • land tenure reforms or the concerns of women or indigenous peoples.

The report urges interested groups to inform their Executive Director about the review’s shortcomings, and press for improvements.