Critics have condemned the World Bank's new information policy, as a mockery of the basic rules of informed public debate and environmental review of projects.

CITIZENS' groups have flayed the World Bank's (WB's) new information policy -- Expanding Access to Bank Information (EABI) -- for keeping information in and people out.

In a desperate attempt to shore up its sinking image and secure a $18 billion capital replenishment, WB had recently cobbled together the information policy to appease its critics. Though approved with much fanfare by WB's executive board in late August, the new policy is being condemned for giving sweeping and arbitrary powers to WB staff and governments to decide who sees what.
Sardar Sarovar project WB's reputation, tarnished by decades of failed projects that have sunk Third World countries deeper into debt, fell further with the Sardar Sarovar dam project. For years, the WB had disguised its errors and ill-founded projects by citing secret feasibility studies and economic analyses that it claimed were thorough and unassailable.

But that facade has been ripped off now with the release of the WB-appointed Sardar Sarovar independent team's report in June 1992. Contrary to WB claims, the review team found "there was no proper appraisal made of the Sardar Sarovar Project". Indeed, so flawed were the appraisals of resettlement and rehabilitation, the environmental effect and hydrological conditions, that the team concluded, "There is good reason to believe that the project will not perform as planned... Assertions have been substituted for analysis."

The timing of the report was disastrous for WB, which had just begun negotiations for a $18 billion replenishment of the International Development Association (IDA), the WB agency that gives virtually interest-free loans. Widespread coverage of WB's duplicity and incompetence soured taxpayers and their governments in donor countries. Canada and Finland cut back their contributions, while the US Congress threatened not to appropriate any new funds for IDA if WB didn't adopt a more open information policy.

WB scrambled and, in October 1992, set up an internal working group to review and recommend changes in its prevailing "Directive of Disclosure".

Almost a year later, on August 26, 1993, WB's executive board approved the EABI, insisting it was "substantially more open". Critics, meanwhile, note the new policy's claim that the bank "recognises and supports the fundamental importance of accountability and transparency in the development process" is overridden by exemptions built into the directive to ensure continued non-disclosure of WB documents.

Instead of releasing the documents on which WB and the borrower will base their decision to proceed with a project -- engineering studies of dams, site plans for irrigation systems and cost-benefit analyses of forestry schemes, for example -- WB will release a two-page "project information document" (PID) that expunges any sensitive or confidential details contained in the complete documents. "This," WB, nevertheless, heralds, "will provide substantially more information on projects, and at an earlier stage, than is currently available."

While the PID does provide something where nothing was available, there is no reason for the public to feel reassured. WB's refusal to provide for the automatic release of all important documents makes a mockery of the fundamental rules for an informed public debate and environmental review.

WB's economic memoranda and country reports such as poverty assessments, private sector assessments and public expenditure reports -- called the Country Economic and Sector Work Reports -- will be released to the public only if the borrower permits and after they have been distributed to WB's board of executive directors.

Audits of WB projects by its own internal operations evaluation department, which make for some of the most interesting reading to leak out of WB, will be published in summary form only. Legal opinions prepared by WB's vice-president and general counsel will be released on a "case-by-case" basis only if the executive board approves.

Under these rules, it is difficult to imagine that an incident such as the leakage of a memorandum by Ibrahim Shihata, WB vice-president and legal counsel, would ever take place. In the memorandum, Shihata corrected the board's impression that the Indian government was no longer legally bound to carry out its obligations under the Sardar Sarovar loan agreement. "This is not the case," he explained, citing Section 6.06 of the general conditions applicable to all bank loans and IDA credits, and should "be borne in mind by staff in their further pursuance of the matter."

WB has laid out the most tangled part of its policy for environment-related documents, the subject on which it feels most vulnerable. Borrowers will be responsible for preparing environmental assessments for WB's and IDA's Category A projects -- those with sensitive, irreversible and diverse impacts, and with involuntary displacement of people -- and for releasing them in their country before the project can proceed to the appraisal stage. Only when this is done, will WB make the environmental assessment available at bank headquarters and field offices.

According to WB, this procedure is already in force for IDA loans worth $600 million, advanced to improve and expand irrigation and drainage systems in Orissa, Haryana and Tamil Nadu. If the borrower objects to the broad release of the environmental assessment for International Bank for Reconstruction and Development projects -- WB's hard-loan window -- it can take the matter to the board for a decision.

Apparently believing these measures should be enough to tranquilise its environmental critics, WB then recommends that environmental analyses for Category B projects -- schemes smaller than Category A projects in scale: smaller dams, irrigation systems, roads, and fewer people being displaced -- need be released only if they exist as a separate document, otherwise the details will be condensed into the PID.

When it comes to environmental action plans, describing a government's environmental concerns, priorities and programmes, WB will "encourage" governments to release the plans to their public, but will only release them with the borrowing government's consent.
What the critics say
WB critics, such as the US Environmental Defense Fund (EDF), claim the new information policy will create confusion and fail to make the bank more transparent and accountable. According to EDF, "The provision to release certain documents on a case-to-case basis... will allow arbitrary refusals of information by task managers, country operation directors and member governments, and result in the unequal treatment of those requesting information and unequal application of the presumption in favour of disclosures."

Critics say WB is trying to turn a vice into a virtue by exaggerating the value of releasing information that is too little, will come too late, and only if governments (not known to embrace public scrutiny of public affairs) agree to it. In the interest of maintaining the "integrity of the decision-making process" and its "relationship of trust with its borrowers," WB presumes all its documents are confidential except the ones it preselects for disclosures.

This contradicts the very premise of access to information laws. WB, it seems, has decided to throw a few preselected bones to its critics in the hope their demands will be quietened. But by preselecting the documents that will be made public, WB has ensured their sanitisation.

As the executive director representing India stated in his briefing notes for board discussions, "If Country Economic and Sector Reports can be released without the borrowers' consent, borrowers would have to be extremely careful about sharing confidential information with bank staff."

As for project and appraisal reports, he explained, "If it were decided to circulate these papers, it would be necessary to divide them into two parts, one dealing with information and technical details (which could be made public) and the other dealing with judgements and future policies (which have to remain confidential)."

Member governments, however, have nothing to fear: The information policy ensures that virtually no document can be released without the prior consent of borrower governments, without explanation and without appeal. Those that can be released are few and preselected, allowing the authors ample opportunity to expunge final drafts of incriminating details. As if this wasn't enough, insider reports indicate the new information policy is now being transformed into even more restrictive staff guidelines by WB's legal department.

In future, as in the past, the best access to WB will come from deep throats and leaks of various kinds. Even this article depended upon a brave soul who leaked the draft and final policy documents to us. The EABI, which was considered and ultimately passed by WB's board of executive directors, is, and remains, secret.

Subscribe to Daily Newsletter :
Scroll To Top