World Bank to Overhaul Amazon Project

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WORLDWIDE FOREST/BIODIVERSITY CAMPAIGN NEWS

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Forest Networking a Project of Ecological Enterprises

http://forests.org/

4/23/97

OVERVIEW, SOURCE & COMMENTARY by EE

Following is an insightful, well researched account of the

difficulties faced by the World Bank's PLANAFLORO environmental

protection loan in the Amazon. Efforts by the WB to reform the

project are noted. This item is a photocopy for educational and non-

commercial use only (as always).

g.b.

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/* Written 4:46 PM Apr 20, 1997 by irn@ax.UUCP in rainfor.general */

/* ---------- "ENVIRONMENT-BRAZIL: World Bank Amazon Project" --------

-- */

From: Glenn Switkes <irn>

Worldwide distribution via the APC networks.

*** 15-Apr-97 ***

Title: ENVIRONMENT-BRAZIL: World Bank to Overhaul Amazon Project

by Abid Aslam

WASHINGTON, Apr 15 (IPS) - The World Bank is having to overhaul

its plans to remedy the environmental and social damage wrought by

a series of Bank-financed projects in the Brazilian Amazon during

the 1980s, according to the Bank's independent inspection panel.

At issue are the Bank's plans to revive a 167-million-dollar

environmental protection loan, approved in 1992, for a natural

resource management project in Brazil's Rondonia state.

Some four years after the Bank launched that effort, known as

PLANAFLORO, deforestation has actually increased to "high

historical levels" of nearly 450,000 hectares per year, the

agency's inspection panel says in a new report to the executive

board.

This has happened even though the Bank in 1995 acknowledged it

had fallen down on the job and offered new plans to get PLANAFLORO

up and running, the panel notes.

"Analysis of satellite imagery...done under the project

demonstrates that, contrary to project objectives, deforestation

during the period 1993-1996 has increased considerably," the

report states.

As much as 90 percent of the forest loss is believed to be at

the hands of illegal loggers, says panel chairman Richard Bissell.

The report notes that, under PLANAFLORO, tracts of forest land

were set aside for indigenous people and forest conservation in a

region besieged by loggers and migration since the 1970s.

Invasions of these protected areas continue, however, and

little progress has been made in implementing the project's other

goals, including a health plan for local Amerindians.

"Although there's been much progress in demarcating reserves

and establishing the legal title of Amerindians (to local lands),

these are largely ignored," Bissell notes. "There's no policing,

and lots of encroachment."

Drawing the boundaries of forest and indigenous peoples'

reserves is "a necessary, but not sufficient, condition for their

protection," the panel report says, citing studies by the Bank's

own Operations Evaluation Division (OED).

"Financial disincentives...and strong enforcement capacity to

prevent and punish invasions are also required for ensuring the

protection of such areas," the panel quotes one OED report as

stating.

Yet, the inspectors add, "the suggested disincentives were not

included in the project, with the result that invasions and

illegal settlements have continued to be one of the most

persistent problems."

Plagued by shortcomings, PLANAFLORO itself was born of the need

to correct past mistakes.

The loan was made because the environmental and social

components of a series of Bank-financed projects known

collectively as POLONOROESTE "had been neither adequate nor

implemented", the panel report says. The new effort "was meant

to be a showcase project for a new era in Bank lending for

sustainable development," it adds.

By June 1995, however, Brazilian non-governmental organisations

(NGOs) complained to the inspection panel that the Bank had turned

a blind eye to Brazilian government agencies' failure to honour

the project's goals. The NGOs themselves endorsed those goals,

according to the panel.

The claimants, who included indigenous people and small farmers

and rubber tappers, argued that, by ignoring these failures, the

Bank was violating its own policies on the environment, indigenous

people, and project supervision.

The Bank itself acknowledged some of the NGOs' allegations and

put forward a plan of action it said would speed and tighten

PLANAFLORO's enforcement.

That plan was enough to persuade the Bank's executive board not

to launch a full-scale probe of the project. But the executive

directors said they would ask the inspection panel to review the

Bank's progress in implementing the plan.

In its latest report, released here last week, the panel notes

that the Bank has improved its supervision of the project, along

with "administration at the technical and accounting as well as

the managerial level."

But the project, which was to have wound down by last December,

continues to face enough problems that the Bank is looking to

restructure it for the second time in as many years.

Although the details have yet to be agreed, Bissell says the

restructuring will enable the Bank to concentrate on the most

important and vulnerable areas and to make sure the project's

benefits flow "more directly" to local communities.

The project "still has not come up with a completely

satisfactory formula for grassroots participation," which was to

be one of its hallmarks, says Bissell.

The Bank and its Brazilian partners have been experimenting

with ways to make sure money earmarked for local communities is

not diverted by bureaucrats or businessmen.

Under a new 'Community Initiatives Support Programme', local

communities can apply for grants to help them achieve development

goals of their own making. But sources close to the process say

such efforts remain vulnerable to local business elites, who have

posed as NGOs and tried to siphon off funds.

It is difficult to prevent such abuses because "civil society

is very rudimentary," says one analyst. Bona fide NGOs themselves

tend to come and go, he notes. Many such groups are formed as

protest movements, and when their immediate purpose is fulfilled,

they disband or move on.

Although no date has been set for submitting the PLANAFLORO

restructuring plan to the Bank's executive board, and although the

retooled project is likely to involve no new money, Bissell says

it is "a hopeful sign that the Bank wants to stay involved and

remains committed to strengthening natural resource management in

this region."

Just to be sure, the board will continue to review the project

"regularly", he added. (END/IPS/AA/97)

Origin: Washington/ENVIRONMENT-BRAZIL/

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