ambiente e istituzioni internazionali

["AlessandroGimona"<agimona@libero.it>]

Cari tutti, 

un articolo (spero) interessante dal sito 

http://www.foreignpolicy-infocus.org/briefs/vol5/v5n33bretton.html


Si occupa di come inserire l'ambiente nell'agenda della Banca mondiale e 
FMI.

Saluti
Alessandro Gimona 


A joint project of the Interhemispheric Resource Center 
                                                     and the Institute 
for Policy Studies


                                                                

                               In Focus: Greening the Bretton Woods 
Institutions

                                                       Volume 5, Number 
33
                                                         September 2000

Written by Andrea Durbin and Carol Welch, Friends of the Earth
Editors: Tom Barry (IRC) and Martha Honey (IPS)

 

Key Points

     The IMF and World Bank have failed to integrate environmental 
sustainability into their lending, concentrating instead on export-led 
exploitation of natural
     resources. 
     Congressional funding pressure has had some success in promoting 
transparency, accountability, and environmentally sound policies at the 
BWIs. 
     Despite years of reform efforts, the World Bank’s structural 
adjustment loans still do not follow the institution’s environmental 
policies. 

The Bretton Woods Institutions (BWIs)—the World Bank and the 
International Monetary Fund (IMF)—have come under increased scrutiny and 
criticism over the
past several years. In April 2000, thousands of demonstrators took to 
the streets of Washington, DC, to protest against these institutions and 
demand change. The
protests followed a scathing report by a prominent congressionally 
appointed panel—the Meltzer Commission—that called for drastic reforms 
of the World Bank and
IMF. Combined with the ongoing criticism by advocacy groups from both 
developing and industrialized countries, these recent events have 
focused unprecedented
attention on the BWIs.

This long-overdue scrutiny is most welcomed by the environmental 
community. Environmental groups have fought since the 1980s to overhaul 
the World Bank and
IMF, urging the institutions to incorporate environmental goals, to 
become more open, and to change the nature of the investments they 
support. As the BWIs’ largest
shareholder, the U.S. has played a positive role in forcing them to 
respond to citizens’ concerns. For example, the U.S. Congress 
conditioned the World Bank’s
appropriations on the institution’s adoption of environmental and 
information disclosure policies. Congressional suasion also led to the 
creation of the World Bank’s
Inspection Panel, an independent accountability mechanism. And in 1994, 
Congress used the power of its purse to force more information 
disclosure at the IMF.
These efforts have yielded some successes with significant 
ramifications, including: 

     A set of environmental policies and standards that the World Bank 
applies to its borrowers, that are considered de facto international 
environmental standards
     by bilateral finance agencies and corporations. 
     More transparency in the operations of the BWIs and greater 
acknowledgement that civil society has a role to play in critiquing and 
shaping lending programs. 
     More accountability mechanisms to promote better quality lending, 
such as the independent Inspection Panel at the World Bank. 

Although important, these improvements have occurred at the margin of 
the BWIs’ operations. The World Bank still provides loans for 
environmentally and socially
harmful projects. IMF and World Bank structural adjustment loans still 
promote export-led growth, encouraging natural resource exploitation and 
endangering local
communities that depend on these resources for survival. The World 
Bank’s structural adjustment loans do not even follow the institution’s 
environmental policies. And
staff at the institutions rarely question how the structural adjustment 
loans they design will affect either the environment or the poor. In 
spite of these problems, the U.S.
Treasury Department has been a staunch advocate of structural 
adjustment.

Although the U.S. has played a positive role in pushing for more 
transparency and accountability at the BWIs, profound problems remain 
with how the institutions put
principles into practice. The U.S. must ensure that World Bank and IMF 
loans comply with the institutions’ policies, and remaining policy 
loopholes must be closed.

For example, though the World Bank has established environmental 
policies, its own studies find that it routinely fails to enforce them. 
A recent internal review revealed
that the bank has failed to comply with its forestry policy, at the 
expense of both the forests and the poor. “Categorization” of World Bank 
projects also falls prey to
political pressures. This process is supposed to demand detailed 
environmental assessments of the largest, most environmentally harmful 
projects, but bank staff often
downgrade projects and thus evade fully assessing them. Finally, while 
the bank has adopted a green rhetoric, its actual portfolio fails to 
reflect its supposed
commitment to environmental protection. Funding for environmentally 
harmful projects—such as for the mining, power, and road 
sectors—constituted almost
one-fourth of the bank’s total lending in 1998. More than half of all 
lending from the World Bank’s private sector divisions was for 
environmentally harmful projects.
Meanwhile, the resources that the bank devotes to environmentally 
beneficial projects are on the decline, amounting to just 1.02% of the 
institution’s lending in 1998.

The bottom line is that most IMF and World Bank operations fail to 
genuinely incorporate sustainable development principles. As the single 
largest shareholder of both
institutions, the U.S. government should play a leading role to push 
them to change the direction of their lending and incorporate 
environmental goals routinely into their
approach.

 

Problems with Current U.S. Policy

Key Problems 

     Although IMF and World Bank structural adjustment programs can lead 
to environmental degradation and increased poverty, there are currently 
no
     requirements for environmental and social assessments of these 
loans. 
     The World Bank’s lending portfolio reveals continued funding of 
environmentally harmful projects and decreased funding of 
environmentally beneficial projects,
     belying its green image. 
     The World Bank’s environmental and social policies have been 
weakened over the years, and World Bank staff often ignore those that 
remain. 

The BWIs have done an impressive public relations job, selling 
themselves as changed institutions that have responded to widespread 
criticism. The World Bank
describes itself as 180 degrees different from what it was in the 1980s. 
Similarly, the IMF contends that it judges itself by how it serves the 
poor. But these descriptions
do not fully reflect reality.

The IMF explains that as a macroeconomic institution it deals solely 
with short-term economic issues and has no mandate to address the 
environment. While it is true
that the purpose of the IMF is to address economic stability and 
short-term liquidity problems, the fund has inappropriately involved 
itself in longer-term restructuring of
economies, which often has an environmental impact. In addition, the IMF 
plays an even broader role by bestowing a “seal of approval” on 
countries’ economies. This
seal is often a precondition for other donor assistance, debt relief, 
and even private investment. The IMF’s model of economic growth and its 
seal of approval are
based on export-led growth rather than domestic productive capacity. 
Export-led growth in IMF borrowing countries has tended to be based on 
primary commodities,
whose prices are notoriously unstable and whose extraction is 
environmentally hazardous.

Any typical IMF stabilization/adjustment program (stabilization and 
adjustment have become virtually synonymous at the IMF)—including budget 
cuts, tax increases,
and trade and investment liberalization—has environmental costs and 
benefits. Unnecessary environmental degradation often results from IMF 
economic programs
precisely because the programs never consider environmental costs and 
benefits. The IMF fails to recognize the inseparability of economic 
stability and environmental
well-being. Furthermore, the IMF has no policies that guide its lending, 
nor are its programs subject to any environmental or social assessment.

When it comes to broad economic policy, the World Bank has followed the 
IMF’s lead and adopted structural adjustment programs that follow the 
same principles of
export-led growth. Although environmentalists fought for years for 
environmental and social policies to guide World Bank lending, these 
policies do not apply to the
bank’s structural adjustment loans. This is becoming a greater problem, 
since the bank has significantly increased its lending for structural 
adjustment loans in the past
several years. The structural adjustment policy loophole is a glaring 
problem that must be rectified, and the U.S. should make environmental 
and social assessments of
structural adjustment a priority.

When it comes to projects, the World Bank also has a long way to go 
before it can truly claim to be promoting environmentally sustainable 
development. Many of the
bank’s loans support projects that involve unsustainably managed natural 
resource extraction or pollution generating projects, such as coal-fired 
power plants or roads,
when more environmentally sound alternatives are feasible. The World 
Bank has responded to environmental criticism by promoting Global 
Environmental Facility
(GEF) add-on grants but has made little progress in integrating 
environmental sustainability into its own portfolio. The bank’s lending 
portfolio tells the story: between
1998 and 1999, funds committed to environmental projects decreased by 
almost one-third.

At an institutional level, the World Bank has undergone a restructuring 
and reorganization that has weakened the role and purpose of its 
environment department. The
bank is more decentralized, making it even more difficult to integrate 
environmental goals into the institution’s overall portfolio. Country 
departments must pay for
environmental expertise and advice, which imposes additional costs 
during periods of budgetary constraints. The World Bank is also in the 
process of revising and
weakening its policies—making key elements of some policies voluntary 
rather than mandatory—which is a giant step backwards. But of course, 
policies are only half
the picture. The bank must also be forced to follow its policies, since 
there is voluminous evidence in internal studies showing widespread 
disregard for them.

 

Toward a New Foreign Policy

Key Recommendations 

     The U.S. should insist on environmental and social assessments for 
structural adjustment lending. 
     The U.S. should pressure the World Bank to change its lending 
portfolio, not only phasing out destructive investments, but also 
increasing environmentally
     beneficial projects. 
     The U.S. should urge the establishment of a development screen for 
the World Bank’s private sector loans. 

Criticism of the BWIs can be expected to continue as long as the 
institutions fail to make serious reform of their core activities a 
major priority. The U.S. should play a
strong role in catalyzing this overhaul, and environmental 
sustainability should be a key item on the reform agenda.

Atop the U.S. environmental reform agenda for the BWIs should be 
overhauling structural adjustment lending. The IMF, staffed by 
macroeconomists and with no
guiding policy framework, is not equipped to promote policy reforms 
outside its immediate area of expertise—balance of payments and exchange 
rate issues.
Longer-term lending should be left to the World Bank. But economic 
adjustment policies at the World Bank must also be overhauled. It is 
critical for the World Bank
to assess the environmental impacts of its structural adjustment 
lending. Information disclosure must also be improved in this area, 
including release of drafts of sectoral
and structural policy loans, so that civil society can participate in 
shaping policies.

In addition, participation in the process of negotiating structural 
adjustment loans must be dramatically broadened, so that all relevant 
government stakeholders are
involved. This should embrace the full range of government officers, 
including environment ministers and parliamentary officials.

The environmental agenda for the IMF is primarily a “do no harm” agenda, 
an attempt to stop the institution from setting policy in areas where it 
lacks expertise. But
the IMF could also play a positive role in encouraging environmental 
protection. For example, the IMF has been tasked with promoting budget 
transparency in its
borrowing countries. In this role, the fund could encourage its 
borrowers to invest in environmental programs. Although it is not 
appropriate for the IMF to expand its
powers by subjecting countries to additional conditionality (such as 
ordering countries to increase environmental spending), publishing 
environmental spending figures in
government budgets might pressure those governments to at least 
maintain, if not increase, investment in environmental sustainability. 
At minimum, this type of
disclosure would enhance the power of citizens to hold their governments 
accountable.

The IMF could also play a role in devising methods of incorporating 
environmental services into economic valuation. One of the fund’s 
functions is to gather data on the
macroeconomic health of its member countries. But these figures are 
based on GDP measures that fail to capture environmental externalities. 
This approach is flawed,
because it assumes that natural resources are infinite and does not 
recognize the liabilities created by the environmental destruction 
resulting from unsustainable
development. The IMF—as a global statistics depository and in its role 
of providing technical assistance on national income accounting systems 
for finance ministries in
developing countries—should work with governments to develop green 
accounting systems and to integrate the environment into each country’s 
national accounts.
Regarding fiscal policy, the IMF could promote more “win-win” solutions 
by including green taxes as part of its advice. This could generate 
revenue while influencing
economic activity in ways that have positive impacts on the environment.

Similarly, many reforms are sorely needed regarding the World Bank’s 
operations. As with the IMF, the environmental community has 
historically focused on a “do no
harm” approach to minimize the damage the bank causes. In that vein, the 
World Bank should expand its “negative list”—types of projects that it 
will not finance—to
include projects that lead to severe environmental harm. This negative 
list should apply to all of the World Bank’s lending arms, including 
those that lend to the private
sector, and should include: projects in or impacting on protected areas; 
infrastructure or extractive projects in frontier or primary forests; 
oil, gas, and mining
investments; projects involving the production or use of persistent 
organic pollutants; and large dams with significant environmental/social 
impacts.

Focusing less on these harmful projects would free up resources that the 
World Bank could spend on environmentally sustainable development. As 
part of a “do more
good” environmental agenda, the bank should proactively set positive 
lending targets for its sectoral loans to leverage investments in 
environmentally sustainable
development. For example, in the energy sector the World Bank could 
shift global investment trends by financing environmentally sound power 
projects. It could
accomplish this by setting quantitative targets for investments in 
alternative/renewable energy, demand-side management, and energy 
efficiency programs. The bank
could also set lending targets for the transport, water, and agriculture 
sectors, key areas where loans have significant environmental impacts.

One of the challenges the World Bank faces is making a positive 
contribution to development through its private sector divisions, the 
International Finance Corporation
(IFC) and the Multilateral Investment Guarantee Agency (MIGA). Most of 
the IFC’s and MIGA’s investments lack a connection to poverty 
alleviation and sustainable
development—the stated mission of the World Bank. To address this 
problem, the U.S. should prioritize the establishment of clear 
development criteria and an
environmental/social screen by which to assess projects and 
corporations. A strong screen would promote better quality projects by 
culling harmful projects and
companies with poor environmental and social records. Furthermore, such 
a development screen would clarify the kinds of results the IFC aims to 
achieve from its
investments and would reduce the time and resources spent on projects 
that do not match the organization’s priorities for development results. 
Finally, to enhance
commitment to the consistent application of such a screen, the 
development criteria should be formulated through a participatory 
process that seeks input from a wide
variety of stakeholders and civil society organizations.

Andrea Durbin <ADurbin@foe.org> is director of the international program 
at Friends of the Earth in Washington, DC. Carol Welch <CWelch@foe.org> 
is
an international policy analyst at Friends of the Earth in Washington, 
DC, where she specializes in international financial institutions.