Meeting president Kim’s pledge of “no dilution” for safeguards

Civil society forum

12 October 2013

Sponsors: Ulu Foundation (US), Urgewald (Germany), Green Watershed (China), Lembaga Keadilan Ekosistem (Indonesia), Friends of the Earth (US), NEPA (India)

Panelists: Yu Chen (Both ENDS – Green Watershed), Korinna Horta (Urgewald), Orchida Ramadhania, Mayra Tenjo (ILSA)

Chair: Pieter Jansen (Both Ends)

This panel will focus on methods for ensuring that the President’s mandate of ensuring “no dilution” can best be met, exploring ways to ensure “upward harmonisation” of Bank safeguards with the highest existing standards, avoiding the “China excuse,” recommendations for the scope of the safeguards review and an examination of the relevance of IFC Performance Standards as a model for World Bank Safeguards.

Korinna Horta

• Safeguards review looking at different approaches on rights
• New German human rights strategy, could things in there be helpful
• Strategy that is binding for all bilateral aid, adopted in 2011, “favours, promotes and demands” human rights approach at MDBs.
• Rights-based approach – adopts a fresh perspective on human rights, state actors are obliged to fulfil rights
• 2 track approach – support for specific human rights- related projects + multisectoral approach to ensure that the policy is applied to all sectors and areas of international cooperation
• All bilateral cooperation, especially in the area of infrastructure development, will be subject to a previous assessment of the human rights impacts
• FPIC for local communities and indigenous peoples
• Can’t separate development goals from human rights
• WB mission revolves around human rights – but also distinction between politics and development
• Previous legal counsel, Danino legal memorandum on human right
• EIR, WGB needs to look at human rights dimension
• New strategy to end risk aversion and rigid and time consuming compliance processes
• A critical juncture – taking greater risks or adopting a human rights approach to development

Yu Chen, Green Watershed China

• China’s regulation on overseas investment and operation
• Policies regarding green banking, green overseas investment and forests
• Green banking – including to strengthen environmental and social risk management for overseas projects, should make promise in public that appropriate international practices or international norms will be followed
• Green investment – new as of this year, including to respect religion, culture traditions and ethnic customs of host nations, release environmental information regularly, study and learn from the environmental protection principles, standards and practices of international organisations and multilateral financial institutions
• Applies to all Chinese enterprises
• Forest – applying to Chinese enterprises operating abroad, including guidelines on high conservation value forest, forest monitoring, forest fragmentation, biodiversity, EIA and community development
• Chinese governments, especially new leadership, making efforts to strengthen its environmental policies, but still lots of concerns, eg no sanction of wrong doing, principle-based approach is problematic
• Chinese civil society demands high WB standards which are rules based

Mayra Tenjo, ILSA

• IFC financed project, shows current performance standards are not ideal, hope safeguards can be improved at policy and implementation level
• Infrastructure port project, Chile, Mexico, Peru and Colombia – Pacific Rim integration – two large terminals, one for exporting hydro carbon
• Buenaventura largest port in Colombia on Pacific side, close to many mega projects with negative impacts
• Project time frame 15 years, completion 2019, since 2010 people in extreme poverty increasingly vulnerable, also armed group interference, internal displacement to make space for the port, intimidation to not talk about impacts
• Most of crimes, are against young afro Colombians in urban areas who have been critical of the project – classified as gang crimes, but closely related to these large projects
• Legal actions have been brought and to CAO, to review violations and found human rights violations, but linked to other projects, so ignored the case
• Environmental studies ignores cultural practices of the population, and also the right to FPIC
• Today poverty and living conditions are worse, worsening of armed conflict, unemployment, etc – bad for community, but good for economic interests coming into the area
• Important to talk about upward harmonisation, IFC performance standards have not succeeded in getting projects like this to protect communities
• On this project, IFC is considering a second disbursement

Orchida Ramadhania, Ecological Justice Indonesia

• FPIC, what does it mean – is it free from intimidation, self- selection of CSO participants, lack of information materials, etc
• Concerns of dilution of safeguards, what does the focus on principles mean – flexibility
• KYC – know your customer, private sector due diligence requirement, vague and ambivalent objectives should not be used to dilute existing safeguard policies
• March 2013 consultation in Jakarta
• No multistakeholder meeting held (despite claims), no CSO witnesses at government and private sector meetings, video recording only of selected parts of the meeting, changes to minutes, etc
• FIP – criteria include ban on FIP support for industrial logging, but included in IFC project plan
• FIP consultation process problems, incl FPIC ignored
• Tendency to invite primarily NGO groups which receive financial benefit from WB climate programmes
• Call for safeguards to be mandatory, etc

Stephen Lintner, World Bank safeguards team

• There is a concern that the process can lead to moving downward, but we are trying to maintain the standards we have and allow them to evolve
• Clients, governments, we are working with are fundamentally different
• Intention is not to weaken but to come up with a system that works better, and delivers on the ground
• Won’t move away from requirements on indigenous peoples, resettlement etc – but way of getting there may need to change
• Built on large complex infrastructure projects, now also small scale community projects – how to deal with this range of projects, need more tools
• Concern re which model to use, ADB, IFC etc
• Looking at a whole range of options right now, could be a hybrid
• Need to be able to implement
• Emerging issues, what do we do with human rights – don’t really have a position yet, but discussions contribute to this
• Some think elements of IFC are good, eg recognized that ecological services need to be recognized, maintenance of systems that are complex
• Problems with IFC generally about mechanics, role of client

Q

Colombia case, CAO found human rights violations linked to other projects, what were they?

Tenjo

• Several projects, including construction of a board walk displacing 4000 people, construction of a highway with significant displacement. CAO conclusion said the env impact assessment should perhaps be done again, as social situation had changed. Private company conducted another study, but project still went ahead.

Q Marc BIC

What are you looking at for best practice, eg BMZ guidelines.

Charles di Leva, World Bank safeguards team

• Looking at anything submitted to us, looking at what Korinna presented, and China.

Q

WB already made contribution to Chinese regulatory framework, also developer of hydro uses WB standards. Supervision of implementation.

Chen

• Can’t speak on behalf of government, but expect if you go through formal channels to approach Chinese authorities to clarify your claim and deliver the communities voice, I’d help referring to Chinese standards, or refer to WB international practices. Difficulty approach authority
• Question for Charles, on country systems and partnerships, what principles do you use to decide whether to use country systems – do we need to monitor if you use Chinese laws and policies

di Leva

• Two models on use of country systems, WB and ADB policies. Baseline equivalent with national legislation to use country systems approach, derived from safeguards – also have to determine if institutions are capable of implementing these policies. This is why the country systems have not been used to the extent we expected.
• ADB model, understanding that rather than doing country system approach at inception – have trust fund to work on capacity first, then using country systems
• Q Stephanie
• CAO case, projects linked to development of the port
• ADB considers all aspects of the projects taking into account, would have been required to make a cumulative impact assessment – important point for upward harmonisation

Q

Chinese policies in place, language seems good, but noted concern re implementation gap. What role is there for the Bank’s practices to raise this implementation gap.

Motoko Aizawa, World Bank safeguards team

• On the financial sector, on the green credit, IFC in collaboration with CBRC since 2007 to concretise the green credit policy. Previous attempts by CBRC had not been successful, one of the results were the 2012 policy guidelines.
• On country systems, have received many recommendations on alternative approaches, would love to hear more on this, what are the acceptable criteria to go into our assessment

Q

Equivalence requirement were at the heart of telling where countries are on safeguards – concerning if this is abandoned

Aizawa

• Looking at different ways of how it works, also learn from other examples. Looking at adequacy of other systems.