Sponsors: Regional Coalition for Transparency and Participation formed by Derecho, Ambiente y Recursos Naturales (DAR / Perú), Asociación Ambiente y Sociedad (AAS, Colombia), Centro de Derechos Económicos y sociales (CDES, Ecuador), Centro de Estudios para el Desarrollo Laboral y Agrario (CEDLA, Bolivia), Instituto Brasileiro de Análises Sociais e Econômicas (IBASE, Brasil)
Panelists: Roland Widmer (Senior Associate, World Resources Institute – WRI), María José Romero (Policy and Advocacy Manager, Private finance and DFIs, European Network on Debt and Development), Jocelyn Medallo (Senior Attorney for People, Land & Resources Program, Center for International Environmental Law), Martha Torres Marcos-Ibáñez (Amazonian Affairs Specialist, DAR),
CHAIR: Francisco Rivasplata (Amazonian Affairs Specialist, DAR)
Marta Torres Marco Ibanez, DAR – conducted study. Release of preliminary findings.
Challenge – access of information, particularly throughout entire project cycle. In order to understand which safeguards are available and are applied.
IAB offered some information. However BNDES and China’s Exim Bank were more difficult. No information was available on line for the Bank of Latin America, however staff were forthcoming.
Classic sequence in project cycle – however in development Bank cycle is less clear.
IAB and Bank of Latin America are similar as are those of China Exim Bank and BNDES.
Begun with Peruvian project / Corredor Inter-oceanic – IAB OP 303/ 307 standards will apply generally. However Exim Bank and BNDES apply local laws, at a time of increased flexibility in local legislation.
Issues concerning adequacy of local legislation.
Also studied causes of delay in execution. Government interests can either speed or slow process. Therefore there is a need to understand state interests. In Peru the two countries in question – Peru/ Brazil were in agreement and supportive, the project was quickly implemented.
Again, lack of transparency is a central challenge as it is difficult to proceed without information.
4 projects infrastructure: Peru, Colombia, Brazil and Ecuador – hydroelectric. SGs were precisely developed to mitigate risks. Each bank has different ESS risks systems.
IAB has own standards, however other Banks under study use state laws. Thus policy applicable by IAB is clear, while not so for the Latin American Development Bank.
A system internal to LADB does exist and reflects a lack of trust in local legislation. China Exim Bank – is the least developed. However very important with great import in infrastructure investment in the region.
BNDES – more clarity within Brazil but outside the country the systems used for ESS is more troublesome.
An important subject studied but not addressed here is the issue of Prior and Informed Consent and consultation. Additional information is available in the report, which will be released in the upcoming week.
Comparative studies are essential, given increased MDB lending to governments and to the private sector.
Eurodad and others have been evaluating systems of European institutions such as EIB.
Lack of harmonisation in standards and shocking lack of information about what is being done with public money. This concerns the use of public money and requires public accountability and transparency.
Safeguards have a specific role to play in investment decisions. They are there to prevent negative impacts, allow for monitoring and provide a complaints mechanism.
Some institutions operate jointly, which in light of unharmonised standards can be problematic.
There is also a need to highlight the lack of appropriate grievance mechanism. The report notes that only the IAB has such as system (of the sample Banks studied in the report).
Jocelyn Medallo (CIEL)
What are the leverage points that can be used for change?
Access to information. Gaps in ESS assessment, and reliance on country systems.
1. Agree that some of the greatest challenges arise from lack of information, including consultation. Communities often complain about lack of information.
UNRHR – consultation is not sufficient. Can we identify key points where communities should be part of the consultation process. Upstream and downstream.
Minimum standards for consultation – minimum time frames but also outreach to particularly vulnerable groups.
2. ESS must be premised on independent organs.
Tools are often inadequate. Sometimes they are ‘cut and past’ jobs.
Must undertake up and downstream level – ie, between Bank and country and also community level risks. These must be merged.
Normally by the time projects are agreed with the Bank, issues have already arisen and safeguards become reactive.
3. Trend toward to increased reliance on country laws. Eg, WB, without clear indication of when this appropriate.
Use of borrower system can be a powerful tool, however in many cases countries lack capacity. Banks must therefore undertake long-term investment in capacity development prior to delegation of authority.
What should standards be assessed against – own Bank systems or international standards? Later is preferable.
ADB – similar focus however more emphasis on creation of local capacity prior to ‘jumping’ into delegation of authority.
Do these really matter within the context of a changing environment in which, arguably, the Bank’s role has diminished. However still a point a reference.
Roland Widmer (World Resources Institute – WRI):
Some questions on methodology – sample size, one case for each Bank, how comparable are the cases? One can formulate hypothesis but not test them. That said, information gathering makes a more comprehensive study difficult.
Recommends an upward harmonisation of standards. What are the political economy contexts that might make this difficult – Chinese banks? Pressure on downward harmonisation.
Former president of LADB – advantage of LADB is that ‘it gets things done.’
FPIC – recommendation/ supported and no comment.
ESS – accompanied by an independent assessment system is to be supported. What are the potential for use of new technologies, systems to support process.
In all cases one has gap between espoused rhetoric vs. practice.
How to close the gap: Eg, what type of institutions are they and what are the pressures each faces?
2012 – Faking it or muddling through – study – when firms face competing pressure they decouple rhetoric and practice or muddle through via the path of least resistance. Thus activism can increase costs/ resistance and affect policy outcome.
What is the importance of safeguards? Bank is reviewing policy, it seems not a very positive result, given increased flexibility. Bank retains influence, including among new players – eg, BRICS/ new Chinese banks. Thus it is important that safeguards be strengthened.
Case studies are important as they shed light on important issues, such as key challenges, including transparency, access to information.
Ex-post evaluation recommendation is a first step, recognising that it may not be immediately feasible due to costs. Normally ex-post monitoring is not a focus, particularly given long duration of infrastructure projects. Important that civil society follow this issue.
Indigenous rights – FPIC – normally does not actually take place. Information is taken/ presented as consultation as in many cases the project/ investment decision has been taken. Each consultation pillar is specific and different. Prior consultation, citizen participation.