Environmentalists and human rights campaigners have sounded the alarm at radical plans to ease conditions for World Bank
loans, enabling more than $50bn (£29bn) of public money a year to be
made available for large power, mining, transport and farming projects.
Leaked emails seen by the Observer reveal that senior figures at the bank feared that light-touch regulation would lead to an increase in "problem projects". Critics are also worried that the door could be opened to large-scale environmental destruction and a lack of protection for communities affected by projects.
Ana Revenga, the bank's vice-president for poverty reduction, says in one of the emails: "It might appear that the bank is interested in lending more, hence lowering standards … [It] would likely entail an increase in the number of problem projects and cancellations." The email exchanges indicate that the bank may expand the use of "biodiversity offsetting" – which lets developers destroy nature in one place if they compensate elsewhere. Many social and environmental safeguards appear to have been dropped under the plans, which have not been made public but are at an advanced stage.
The bank group, which loans and guarantees around $50bn a year to over 100 countries to alleviate poverty, is the world's largest development institution, with Britain as its largest donor. It has been consistently criticised for its damaging lending policies and because it is dominated by industrialised countries.
Strong safeguards and conditions on its loans and guarantees were put in place after a series of environmentally destructive projects in the 1980s and 1990s such as the Narmada dam in India and the resettlement of hundreds of thousands of people to make way for palm plantations in Indonesia.
But the World Bank group, which includes the International Finance Corporation, the International Bank for Reconstruction and Development and the International Development Association, is in the process of a reorganisation and wants to harmonise safeguards and standards between its private and public lending groups.
Leaked emails seen by the Observer reveal that senior figures at the bank feared that light-touch regulation would lead to an increase in "problem projects". Critics are also worried that the door could be opened to large-scale environmental destruction and a lack of protection for communities affected by projects.
Ana Revenga, the bank's vice-president for poverty reduction, says in one of the emails: "It might appear that the bank is interested in lending more, hence lowering standards … [It] would likely entail an increase in the number of problem projects and cancellations." The email exchanges indicate that the bank may expand the use of "biodiversity offsetting" – which lets developers destroy nature in one place if they compensate elsewhere. Many social and environmental safeguards appear to have been dropped under the plans, which have not been made public but are at an advanced stage.
The bank group, which loans and guarantees around $50bn a year to over 100 countries to alleviate poverty, is the world's largest development institution, with Britain as its largest donor. It has been consistently criticised for its damaging lending policies and because it is dominated by industrialised countries.
Strong safeguards and conditions on its loans and guarantees were put in place after a series of environmentally destructive projects in the 1980s and 1990s such as the Narmada dam in India and the resettlement of hundreds of thousands of people to make way for palm plantations in Indonesia.
But the World Bank group, which includes the International Finance Corporation, the International Bank for Reconstruction and Development and the International Development Association, is in the process of a reorganisation and wants to harmonise safeguards and standards between its private and public lending groups.
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