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Righting the Bank’s agenda

19 June 2006


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The departing swansong of World Bank former legal counsel Roberto Dañino in January 2006 has finally put to rest any claims that the Bank is legally exempt from taking human rights into account. This has given weight to the proliferation of efforts by global civil society, academics, lawyers, economists and UN entities to bring the World Bank- and other non-state economic and financial actors- to account under international human rights law. Dañino challenges the Bank’s claims of immunity as a non-government entity, and states that consideration of human rights is now essential to the Bank’s current mission. He cites international legal principles to refute assertions by the Bank that its Articles of Agreement prevent it from straying into the realms of civil and political rights and restrict it to working on “economic considerations”.

As if to pre-empt Dañino, in December 2005 the World Bank quietly produced a non-committal ‘question and answer’ on human rights. It is now considering how it might be “more explicit” in its approach. Until now it has skirted the issue of legally binding instruments or the appropriate use of human rights terminology. Instead it has used the ambiguous language of social development, such as empowerment and participation in Voices of the Poor (2000) and good governance. It cites “significant causal links between the provision of human rights, “such as civil liberties”, and positive development outcomes that include the enhanced success of Bank-funded investment projects”. It states that the Bank is now employing “poverty and social impact assessments” to measure the impact of policy reforms on the provision of human rights, and has launched a process to map existing World Bank activities against the provisions of the three core treaties of the International Bill of Rights.

put to rest any claims that the Bank is legally exempt from taking human rights into account

Recent strategies to tackle the Bank’s contribution and complicity in human rights abuses have given legal strength to reactions based on global moral outrage. Such initiatives include:

  • a growing body of legal arguments that prove how the World Bank and the IMF are bound by international legal obligations and/or the obligations of their member states to take full responsibility where their activities negatively impact or undermine the enjoyment of human rights, including the Tilburg Principles, and those by Mac Darrow, Sigrun Skogly and Desmond McNeill. These suggest that a legitimised institutional arrangement should be created to bring them to account formally for their actions. Most recently, Andrew Clapham’s publication Human Rights Obligations of Non-State Actors reinforces the ‘do no harm’ principle with a case for obligations of a more extensive and positive kind;
  • calls for the unconditional cancellation of and reparations from the Bank for illegitimate debt lent to rights-abusing regimes (see Update 44);
  • the development of human rights risk assessments for project finance and investment, such as that of Rights and Democracy in Canada, and the Danish Institute for Human Rights;
  • recent UN instruments including: the UN norms for transnational corporations; the new human rights council; the appointment of special rapporteurs on economic, social and cultural rights; and calls for the creation of a special optional protocol on economic, social and cultural rights, which would allow complaints to be heard at the international level for violations of the International Covenant on Economic, Social and Cultural Rights;
  • demands that the Bank provide reparations for its complicity in projects resulting in grave abuses such as at the Chixoy dam in Guatemala (Update 43), the Bulyanhulu gold mine in Tanzania (Update 26) and the Sardar Sarovar dam in India (Update 20);
  • investigations into IFI-funded investment agreements and the use of ‘stabilisation clauses’ that freeze the rights of governments to legislate for the protection of the human rights of their citizens as in the case of the Baku-Tblisi-Ceyhan (BTC) and Chad-Cameroon pipelines (Updates 37, 47); and
  • the promotion of the right to information and calls for greater transparency and accountability from IFIs, such as that made by the Global Transparency Initiative.

It is unclear where the rights agenda at the Bank is headed. Wolfowitz’s corruption drive appears to have avoided this discourse. The Bank’s claims that human rights are intrinsic in the World Development Report (WDR) 2006 on equity and development have been challenged by critics such as Desmond McNeill and Asun St Clair, who point out that the document makes modest, inconsistent and inexplicit concessions to the issue. They state that equity can be seen either as a “fundamental” value (based on justice and the intrinsic non-tradable moral worth of all human beings); or an “instrumental” economic value (more equitable distribution leads to more economic growth), which implies a modest place for human rights, if any. Despite making the distinction between the to approaches, WDR 2006 still chooses to focus primarily on the latter.

The human rights approaches advocated in the Bank-commissioned World Commission on Dams (2000) and Extractive Industries Review (2004) were rejected by the Bank, despite former Bank president Wolfensohn’s progressive stance on the issue and the assertion that the UN declaration on human rights “could have been the framework which lead [the Bank] down the poverty reduction strategy approach”. The Bank never referenced the Declaration explicitly in its policies. Other concessions included the appointment of Mohammed Sfeir-Younis as the Bank’s ‘special advisor on the social dimensions of globalisation’ (Bank-speak for human rights) (see Update 34). Wolfensohn’s efforts seem to have followed him out, as did Sfeir-Younis and Dañino.

Civil society is cautious. Concerns exist that human rights are in danger of co-optation by the Bank’s good governance and property rights rhetoric, and the skewed US interpretation of human rights that places more emphasis on its concept of democracy. It would not be the first time that the Bank has perverted solid concepts grounded in international law, the most obvious example being the conversion of Free Prior and Informed Consent, to Free Prior and Informed Consultation leading to Broad Community Support (see Update 47).

There are also fears that given its economic and political power and influence, the Bank may end up assuming a role as the arbiter of human rights violations, and burdening countries with an additional set of conditionalities based on human rights. Recently Kenneth Roth, Executive Director of Human Rights Watch was careful to emphasise that the Bank’s role is not to promote human rights per se, but rather that it should integrate a human rights approach into its policies, such as country assistance strategies.

Nick Hildyard of UK NGO Cornerhouse states that major political work is needed in order to change the legal framework in which IFIs operate. “In the case of the World Bank, safeguard policies introduced largely in response to pressure from social movements are routinely ignored”. He underlines the legal difficulty in establishing a causal link between the Bank’s funding and the specific harm caused. Internal accountability mechanisms such as the World Bank’s Inspection Panel are deliberately set up to avoid the provision of hard and fast rules and mechanisms that would allow for the institutions to be brought to justice. The “specially negotiated legal regime” of BTC essentially surrenders the sovereignty of the governments along the pipeline route to the oil consortium. Quoting Amnesty International he says “the effect is to replace ‘hard’ law with ‘soft’ industry guidelines, with the environment and human and labour rights the losers”.

A recent collection of articles published by Amnesty International Human rights, trade and investment matter contains contributions from academia, civil society, the legal profession and the UN. It presents differing views on the role of financial institutions in shaping standards and a critical focus of the human rights implications of foreign direct investment.

A new book edited by Philip Alston and Mary Robinson Human rights and development: towards mutual reinforcement , provides a comprehensive perspective on human rights and the World Bank, and includes chapters on the IMF and IADB. With contributions from Bank staff past and present, including James Wolfensohn, Peter Woicke, Daniel Kaufmann, and Mark Plant, it explores issues of human rights in relation to private and project finance, fiduciary responsibility and macroeconomics, and presents opposing views of PRSPs within the human rights perspective