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News / 10 November 2011

NEW VIDEO: could P4R replace some of the World Bank's safeguards?

Before the end of this year, the World Bank will vote on whether to introduce a new lending instrument called "Programme for Results" (abbreviated as P4R), which aims to better meet the needs of developing countries while increasing the World Bank's reach by bringing funds from public and private donors together in sectoral programmes. NGOs from around the world have expressed concern about P4R, as has the business community and various governments. These parties are concerned that a large number of standards, which may have significant adverse effects on humans and the environment, will be released. A number of organisations have therefore voiced their concerns about P4R in a letter to the World Bank.


Should autonomy imply fewer rules?
Recipient countries - especially the middle income countries - would like the World Bank to focus on lending its support to self-developed sectoral programmes. This is a good objective and consistent with the 'Aid Effectiveness Agenda', in which countries get more say in what their development path should look like. The social- and environmental criteria that the World Bank has used for many years in providing loans, the so-called 'safeguards', would however be abolished with the introduction of the programme, and it is completely unclear why this is the case.

National legislation and control
A lot of work has gone into the creation of these safeguards, which although not perfect according to the concerned organisations, are at least starting to work. P4R will give individual countries a much greater say in determining the social- and environmental criteria that World Bank loans must meet. These criteria are then determined based on the rules that already exist in the country. And there's the rub: in many countries, legislation on social justice and the environment are not sufficiently complied with.

Less transparency and public participation
Another major concern for the organisations is that P4R constitutes a step back in terms of transparency. Within P4R, there is no obligation for the World Bank to specify which projects fall under a loan, something that is currently required for its project loans. This will mean that local communities will not be informed of the World Bank's involvement in developments in their communities in time. On many fronts, P4R will likely cause the World Bank's relatively progressive policies in the areas of the environment, social justice and transparency to fall back to the level of years ago.

What can be done?
The organisations insist that the World Bank explain in detail why it is abolishing its own safeguards. According to P4R's promoters, the programme would be introduced with a pilot, because only then will they be able to see whether the programme works well (by country) and what the consequences will be in terms of transparency, the involvement of civil society organisations and the protection of vulnerable groups and the environment. Moreover, no loans may be provided for projects within P4R (as it's currently defined) that have substantial social- and environmental consequences; all so-called 'Category A' and certain 'Category B' projects. With the letter, the organisations hope that the World Bank will revise the programme and give feedback on their criticism.


For more information:

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