Sustainability requires international institutional reforms

25 March 2002

NGOs preparing to engage in the preparatory process for the World Summit on Sustainable Development are scrutinising the World Bank’s reports relating to the summit topics. They are examining whether the reports are frank and clear about what needs to be done to ensure that the world becomes more equitable and sustainable.

The Bank’s flagship publication, to be released at Johannesburg, will be the World Development Report on Sustainable Development with a Dynamic Economy. The Bank is also launching, in collaboration with other international development organisations, two other major reports which aim to influence the summit preparatory process. These papers, being prepared with UNDP, UNEP, the EU and DFID, cover Poverty/Environment Linkages and Innovative Financing for Sustainable Development. The Poverty/Environment paper was posted on the web in draft form in February for an electronic discussion that will last until June, and the Bank planned to post the draft WDR at the end of March for a much shorter comment period.

A number of public figures and NGOs have recently released reports and statements that can be compared with what the Bank is writing. UN Secretary-General Kofi Annan, for example, recently reminded rich countries that achieving the 2015 Millennium Summit targets to halve extreme poverty was ambitious in itself. But if sustainability is overlooked “it will all be in vain”. Speaking in London in February, Annan commented “it is equally important that we achieve another goal set by world leaders at the Summit: ‘to free all of humanity, and above all our children and grandchildren, from the threat of living on a planet irredeemably spoilt by human activities, and whose resources would no longer be sufficient for their needs'”.

Other commentators have spelled out what institutional and other reforms will be needed to achieve sustainability. Many of them argue that international sustainable development institutions have been marginalised by the institutions of globalisation. Chee Yoke Ling and Martin Khor of Third World Network argue that “instead of fulfilling its commitments under the Rio Declaration, Agenda 21, and Multilateral Environmental Agreements (MEAs), the North has turned to the World Trade Organisation in particular, to promote and obtain international rules that are increasingly acknowledged to be counter to the Rio spirit, principles and commitments. The unilateral rejection of international agreements, including MEAs, by some countries is yet another move that jeopardises the multilateralism needed to meet the challenge of sustainable development. The Bretton Woods Institutions, especially the IMF, have also promoted and drawn many Southern countries into macro-economic policies that are adverse to the environment, destabilise national economies and create social disruptions”.

The WTO‘s dispute settlement system based on retaliation and sanctions gives it a strong enforcement capability while the World Bank and IMF have impressive financial resources which enable them to impose conditions on recipient governments. The UN specialised agencies charged with implementing the pledges from the 1992 Earth Summit in Rio are, by contrast, very weak and thus unable to police the implementation of Multilateral Environmental Agreements.

Many NGOs agree that the greatest weakness of the Rio summit was its failure to include frameworks to regulate financial institutions, transnational corporations and new technologies. They feel that the World Summit in Johannesburg later this year will not achieve much without tackling the contradictions between economic liberalisation and other international agreements. This will imply a renegotiation of intellectual property rights agreements and an examination of how government subsidies and procurement practices can be used to further sustainability goals.

The Global Environment Facility, one of the major institutional innovations in the field of international institutions for sustainability, requires review. Whilst its governance structure is relatively progressive compared to that of the Bretton Woods institutions, it is too closely linked to the World Bank and has suffered from an unclear definition of what it should achieve.

E-consultations on World Bank WSSD reports

International Environmental Governance: Some Issues From A Developing Country Perspective

WSSD briefings, International Institute for Environment and Development

Charging the Use of Global Commons, German Advisory Council on Global Change