A November letter from 77 civil society organisations (CSOs) worldwide, including Derecho, Ambiente y Recursos Naturales (DAR) from Peru and Buliisa Initiative for Rural Development Organisation (BIRUDO) from Uganda, called on the World Bank Group (WBG) to “fulfil its commitment to prioritise forests and forest peoples’ rights in its support to borrowing countries and the implementation of their nationally determined contributions (NDCs)” to the Paris Climate Agreement.
The letter, addressed to World Bank president Jim Kim, coincided with the UN Framework Convention on Climate Change’s (UNFCCC) Conference of Parties 23 (COP 23) in Bonn. It called on the WBG to prioritise forests and indigenous peoples’ rights in World Bank Country Partnership Frameworks. The letter further called on the Bank to strengthen safeguards to protect forests and indigenous peoples’ rights, including for Development Policy Loans (DPLs) (see Observer Spring 2017) – which are not subject to the Bank’s new Environmental and Social Framework (ESF). It also argued that the Bank should take steps to avoid funding direct and indirect causes of deforestation, including through investments via financial intermediaries (see Observer Winter 2017).
The CSO letter also urged the Bank to make its Forest Notes – which are currently under development in a select number of countries – open to stakeholder consultation. The Notes were introduced as part of the Bank’s 2016-2020 Forest Action Plan (FAP), and are meant to guide national policy on forests. As then-WBG Global Forest Lead Carole Megevand explained in a 2016 blog, the Notes will, “provide data on the role of forests in alleviating poverty, creating jobs, and mitigating and adapting to climate change. This will inform strategic country diagnostics and help shape our country partnership frameworks that guide our projects.” However, Petra Kjell, from watchdog CSO Bank Information Center, commented that the “Forest Notes were introduced to present in country analysis the threats and opportunities for forests, which should feed into the World Bank’s country strategies. This commitment was reinforced in the IDA 18 [International Development Association’s 18th Replenishment] process, but so far the Forest Notes remain closed for stakeholder engagement – a lost opportunity for genuine solutions for forests and forest peoples’ rights.”
The main problem we found by analyzing the latest Development Policy Loans for Peru is the seemingly little willingness shown by the Bank to develop an adequate monitoring system to assess the social and environmental risks of their different loan operationsHarlem Mariño, Derecho, Ambiente y Recursos Naturales (DAR)
As climate change bites, Bank urged to up its game on forests
The link between deforestation and climate change is well-documented: As Frances Seymour of the Center for Global Development noted in an August blog, “If tropical deforestation were a country, it would rank third after China and the United States as a source of emissions.” However, tackling deforestation is a relatively low institutional priority for the Bank, with small lending volumes in comparison to other areas of Bank finance and WBG country teams often lacking specific forest expertise (see Observer Winter 2016).
The Bank’s lending through Development Policy Loans has also led to deforestation, according to CSOs. For example, Harlem Mariño from DAR emphasised the effect of the Bank’s DPL lending on forests in South American countries like Peru: “The main problem we found by analyzing the latest Development Policy Loans for Peru is the seemingly little willingness shown by the Bank to develop an adequate monitoring system to assess the social and environmental risks of their different loan operations. The evidence of this are the laws approved as prior actions [required for the World Bank’s DPL lending] in Peru to promote investments by reducing the Government’s capacity to sanction environmental infractions caused by the extractive industry, especially those based in the Amazon rainforest.”
Meanwhile, one of the forest initiatives the Bank manages, the Forest Carbon Partnership Facility (FCPF), a climate investment fund that supports Reducing Emissions from Deforestation and Forest Degradation (REDD) projects, received stinging criticism in March in an article published by the REDD-Monitor. The piece called the FCPF, “The most cost-inefficient tree-saving scheme ever,” owing to high administrative costs between fiscal years 2009-2015 absorbing 64 per cent of FCFP’s $55 million expenditure. Subsequently, in August, the Rainforest Foundation UK (RFUK) and US (RFUS) raised concerns in an exchange with the World Bank about full prior and informed consent (FPIC) being achieved among communities affected by a proposed FCPF-supported REDD project in the Democratic Republic of Congo’s Mai Ndombe province. A RFUK briefing published in August found that the Mai Ndombe project’s, “safeguard plans as they currently stand are seriously flawed, [are] inadequate to ensure proper protection against harm, and need substantial re-working, clarification and improvement.”
Despite such shortcomings, as the Bank remains the biggest multilateral source of finance for forests, it has a potentially important role to play in initiating meaningful policy change in this area. Events at COP23 itself offered some positive developments in terms of the need to consult with indigenous peoples as part of the broader NDC process. While the 2015 Paris Agreement recognised the contribution of indigenous knowledge in dealing with climate change, COP23 built on this, arguing that countries, “should, when taking action to address climate change, respect, promote and consider their respective obligations on the rights of indigenous peoples and local communities.” CSOs are hopeful the Bank will heed this language in its own forests policy.