72895 © 2012 The World Bank Group 1818 H Street, NW Washington, DC 20433, U.S.A. Telephone: 202-473-1000 Internet: www.worldbank.org/environment E-mail: feedback@worldbank.org All rights reserved. Published September 2012 This volume is a product of the staff of the World Bank Group. The findings, interpretations, and conclusions expressed in this volume do not necessarily reflect the views of the Executive Directors of The World Bank Group or the governments they represent. The World Bank Group does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of the World Bank Group concerning the legal status of any territory or the endorsement or acceptance of such boundaries. R I G H T S A N D P E R M I S S I O N S The material in this publication is copyrighted. Copying and/or transmitting portions or all of this work without permission may be a violation of applicable law. The World Bank Group encourages dissemination of its work and will normally grant permission to reproduce portions of the work promptly. For permission to photocopy or reprint any part of this work, please send a request with complete information to the Copyright Clearance Center Inc., 222 Rosewood Drive, Danvers, MA 01923, USA; telephone 978-750-8400; fax 978-750-4470; Internet: www.copyright.com. Contents Acronyms and Abbreviations.........................v chapter 4. World Bank SEA Experience Acknowledgments...........................................vii in Middle East and North Africa: A Policy and Planning Tool.....................40 Introduction.....................................................................41 foreword...............................................................1 Evolution of SEA in Middle East and North Africa.........41 Initial Drivers..............................................................41 New Drivers...............................................................42 Energy-Environment Review for Egypt (2003).........44 chapter 1. Introduction...................................3 Energy-Environmental Review for Iran (2004)..........47 Objective and Scope .......................................................3 Lessons Learned..............................................................48 Methodology ....................................................................3 Strong Link between Country Ownership Structure of the report......................................................6 and Effective Implementation of SEA.......................48 References.........................................................................7 SEA as an Instrument to Mainstream Environment to Promote Policy Dialogue................48 Regional Technical Assistance that chapter 2. SEA Experience in the World Facilitates Donor Partnership and Contributes Bank: Synthesis and Conclusions................8 to Capacity Building.................................................48 The Evolutionary Nature of SEA Practice Supplemental Quantitative Tools that in the World Bank .............................................................9 Make SEA More Effective in Priority Setting............49 The Strategic Role of SEA as a Priority Setting Way Forward...................................................................49 and Multistakeholder Dialogue Process.....................9 References.......................................................................51 What Makes SEA Effective?......................................10 Lessons and Good Practices ..........................................13 Influence in Decision Making....................................13 chapter 5. World Bank SEA Experience in Multistakeholder Dialogue.......................................15 South Asia: From Impact-Centered Country Ownership................................................... 17 to Policy Approaches...................................52 Timing.......................................................................18 Introduction and Methodology......................................53 Strengthening the World Bank’s SEA Agenda ..............18 Evolution of SEA in South Asia.......................................53 Final Remarks..................................................................20 Case Studies....................................................................55 References.......................................................................21 Impact-centered SEAs..............................................55 Policy and Institution-Centered SEAs.......................56 Country Environmental Analyses..............................58 chapter 3. World Bank SEA Experience in Blend of Impact and Institution-Centered SEA: East Asia and the Pacific: A Tool Strategic Basin Assessment......................................60 for Environmental Safeguarding.............22 Discussion of Case Studies.............................................60 Introduction and Methodology......................................23 Moving Forward..............................................................63 Evolution of SEA in East Asia and the Pacific.................23 References.......................................................................65 Findings...........................................................................24 Annex 5.1. SEAs Undertaken in the South Asia Region.66 Drivers of SEA...........................................................24 Annex 5.2. Comments from Field Office Staff Timing of SEA ...........................................................25 on Advancing the Regional SEA Agenda.......................67 Stakeholder Participation..........................................25 Ownership.................................................................26 Learning Process.......................................................27 chapter 6. World Bank SEA Experience Environmental Awareness and in Sub-Saharan Africa: From Environmen- Capacity Building within Institutions........................27 tal Safeguarding to Informing Shifting Priorities ......................................................28 Policy Dialogue.................................................. 68 Applying Recommendations from SEA....................29 Introduction.....................................................................69 Looking at the Future of SEA in the Region ..................29 Evolution of SEA in Sub-Saharan Africa.........................69 References.......................................................................32 Elements of an Effective SEA....................................70 Annex 3.1. Questionnaire................................................33 Design and Use of SEA in Africa............................... 71 Annex 3.2. SEAs in East Asia and Pacific Region...........34 Main Drivers of SEA in Africa....................................73 Annex 3.3. Case Studies.................................................35 iii Key Lessons Learned in the Use of SEA Boxes in the Africa Region.........................................................74 Box 1.1. What is SEA in the World Bank’s Experience?....4 Country Ownership...................................................74 Box 1.2. Generic Terms of Reference for Taking Timing.......................................................................74 Stock of Bank Regional Experience in SEA......................5 Stakeholder Engagement.........................................74 Box 2.1. Consultations in the West Africa Capacity Constraints.................................................75 Mineral Sector Strategic Assessment (WAMSSA)..........16 Legal Basis for SEA....................................................75 Box 3.1. REA for Manila Third Sewerage Project, Future Trends: New Applications of SEA in Africa.........75 Philippines (2005)............................................................26 Moving Forward: Developing a Structured Approach Box 3.2. SEA of Tourism Development in to Mainstreaming SEA in Africa .....................................76 Guizhou Province, China (2007)......................................28 References.......................................................................77 Box 3.3. Environmental Assessment for Wuhan’s Annex 6.1. SEAs Completed, Ongoing, and in Urban Transport Development Strategy........................29 the Pipeline in Africa, 1999–early 2012..........................78 Box 4.1. Cost of Environmental Degradation............... 43 Box 4.2. GEPAP...............................................................45 Box 4.3. Sustainable MED.............................................. 50 chapter 7. World Bank SEA Experience Box 7.1. Colombian Experience with in Latin America and the Caribbean: Country Environmental Analysis.....................................84 Enhancing Infrastructure Developments and Sector Reforms...........80 Introduction and Methodology .....................................81 Tables Evolution of SEA in Latin America and the Caribbean .81 Table 2.1. Key Elements of Proposed Impact-Centered Approaches..................................82 Regional SEA Agendas...................................................19 Institution-Centered or Policy Approaches..............82 Table 3.1. Status of SEA Indicators Current Status of SEA in LAC....................................83 in the Region...................................................................30 Main Drivers and Limitations of SEA.........................85 Table 4.1. Egypt: Assessment of Policies to Reduce Discussion and Trends....................................................87 Damage Costs.................................................................46 Sectors Not Always in the “Driver’s Seat� ...............87 Table 7.1. Select SEAs in LAC.........................................82 Certain Sectors More Amenable to SEA..................88 Table 7.2. Country Environmental Analysis....................83 Bank Regional Experience in SEA Table 7.3. Current Planned or Ongoing SEAs Limited in Key Sectors ..............................................88 with World Bank Support in the LAC Region.................84 Impact on Stakeholder Engagement ......................88 Capacity Building for SEA.........................................88 Conclusions.....................................................................89 Figures Coordination with IDB and International Figure 4.1. Egypt: EER Methodology Flowchart............44 Finance Corporation (IFC)........................................89 Figure 4.2. Egypt: Estimated Local Damage Costs.......47 Private Sector Involvement.......................................89 Figure 5.1. Proportion of SEAs in SAR by Country.........54 Regional Priorities for Action ...................................89 Figure 5.2. Proportion of SEAs in SAR by Sector...........54 References.......................................................................91 chapter 8. World Bank SEA Experience in Europe and Central Asia: The Mixed Effects of Regulation.....................................92 Introduction.....................................................................93 Evolution of SEA in Europe and Central Asia ................93 Application of SEA in the ECA Region ....................95 Summary of Results and Lessons Learned ..............99 Ongoing and Potential SEA Development in the ECA Region ........................................................100 Conclusions and Recommendations............................101 References.....................................................................103 iv Str ategic Environmental Assessment in the World Bank Acronyms and Abbreviations AFR Sub-Saharan Africa IAIA International Association for CBA cost-benefit analysis Impact Assessment CEA country environmental analysis IBRD International Bank for Reconstruction CIA cumulative impact assessment and Development COED cost of environmental degradation IDA International Development Association CoP Community of Practice IDB Inter-American Development Bank CPP consultation and public participation IFC International Finance Corporation CSO civil society organization IIRSA Initiative for the Integration DPL development policy loan of Regional Infrastructure of DPO development policy operations South America EA environmental assessment JMP Joint Multipurpose Program EAP East Asia and the Pacific LAC Latin America and Caribbean ECA Europe and Central Asia Lao PDR People’s Democratic Republic of Lao EEAA Egyptian Environmental Affairs Agency MARD Ministry of Agriculture and EER energy-environment review Rural Development EIA environmental impact assessment MENA Middle East and North Africa EIB European Investment Bank METAP Mediterranean Environmental EMAP Environmental Management Technical Assistance Program Action Plan MTSP Manila Third Sewage Project EMU Environment Management Unit MW megawatt ESMF environmental and social NEAP National Environmental Action Plan management framework NGO nongovernmental organization ESMP environmental and social NIS newly independent states management plan NLTA non-lending technical assistance EU European Union NSP National Spatial Plan FCPF Forest Carbon Partnership Facility NT2 Nam Theun 2 FPDP Forest Protection and OP Operational Policy Development Plan PDP Power Development Plan GDP gross domestic product PPCR Pilot Program for Climate Resilience GEF Global Environment Facility PRSP poverty reduction strategy paper GEPAP Gulf Environmental Partnership and PSIA poverty and social impact analysis Action Program RAP Resettlement Action Plan HPCD Hubei Provincial RDP Regional Development Plan Communication Department REA regional environmental assessment HRNP Hubei Road Network Plan REC Regional Environmental Center Acronyms and Abbreviations v REDD reducing emissions from deforestation and forest degradation S&R screening and ranking SAP Strategic Action Program SAR South Asia Region SBA strategic basin assessment SCD Southern Coastal Development SDI spatial development initiative SDP Sibovc Development Plan SEA strategic environmental assessment SECHSA strategic environment, cultural heritage, and social assessment SEPSA strategic environmental, poverty, and social assessment SESA strategic environmental and social assessment SIA strategic impact assessment TA technical assistance TDA Transboundary Diagnostic Analysis UNDP United Nations Development Programme WAMSSA West Africa Mineral Sector Strategic Assessment WMP Waste Management Plan vi Str ategic Environmental Assessment in the World Bank Acknowledgments This report was made possible by the contribution of the core group of the World Bank strategic envi- ronmental assessment (SEA) Community of Practice: Cary Anne Cadman (Africa), Peter Leonard and Aradhna Mathur (East Asia and the Pacific), Adriana Damianova and Ruxandra Floriou (Europe and Central Asia), Francis Fragano (Latin America and the Caribbean), Suiko Yoshijima and Kulsum Ahmed (Middle East and North Africa), and Ernesto Sánchez-Triana and Paula Posas (South Asia). Most of them are authors or coauthors of the regional reviews included here. Chapter discussants included Yewande Awe, Dan Biller, Diji Chandrasekharan, Adriana Damianova, Francis Fragano, Nagaraja Rao Harshadeep, Ernesto Sánchez-Triana, Xiaoxin Shi, and Gothard Walser. The assistance of Linda Starke in editing this report is also acknowledged. This reflection on the World Bank SEA practice would not have been possible without the support of Mary Barton-Dock (ENV Director) and Sari Soderstrom (ENV Sector Manager). Financial support from the government of Sweden is also kindly acknowledged. Acknowledgments vii viii Str ategic Environmental Assessment in the World Bank Foreword In recent years, the World on Environmental and Social Sustainability for the Bank Group has seen an Hydropower Sector� that improved resettlement increase in client demand and consultation practices, integrated river basin for support strategic envi- planning, and enhanced understanding of trans- ronmental assessment (SEA) boundary riparian risks along the Mekong. to integrate environmental considerations into policies, The Bank’s SEA Community of Practice (CoP) Mary Barton-Dock plans and programs. The was established to develop and share knowledge Director Environment Department drivers for this are multiple— building on the structured learning process on SEA. ranging from the adoption The Community enabled practical learning across of national SEA legislation by client countries, to Bank activities, at the country and regional level. support provided by donors, and the inclusion of Learning by reflection was based on a stock-taking SEA in the Bank’s environmental safeguards policy exercise, examining SEA experience to date and OP 4.01 on Environmental Assessment. Increased assessing the relevance of SEA for existing environ- client demand was marked by a simultaneous mental mainstreaming challenges at the regional increase in demand from stakeholders to partic- level. Learning by knowledge sharing helped high- ipate in decision-making around policies and plans light lessons learned in SEAs, including identifying affecting them. A process of learning and struc- good practice within and across regions. Learning tured analytical work was necessary to be able to by doing is occurring through practical experience meet client and stakeholder demand. in applying SEAs to specific cutting-edge, inno- vative Bank projects. Lessons gleaned from the The process resulted in considerable knowledge former two learning processes are analyzed and generation that informed national and regional highlighted in this report. approaches to planning and policy-making. For example, in West Africa, the regional SEA of the Enhancing knowledge from the practical application minerals sector in Guinea, Liberia and Sierra Leone of SEAs in the Bank’s activities is consistent with established a multi-stakeholder dialogue that raised the increasing trend to support client countries at awareness and support for a regional approach to the programmatic and policy level, and will remain enhance environmental management and minerals a crucial focus across activities in the coming years. sector governance. A strategic assessment in Because SEAs engage multiple stakeholders in Colombia supported the preparation of a devel- an adaptive learning process they are an excellent opment policy program that improved Colombia’s vehicle for promoting green, clean, resilient and National Environmental System through inte- inclusive development, in line with the World Bank grating principles of sustainable development in key Group’s Environment Strategy 2012–22*. I thank the sectors’ policies. This served to protect vulnerable SEA Community of Practice for their valuable work, groups and foster a debate that led to the passage and encourage them to continue moving the SEA of the Air Pollution Control bill in addition to learning agenda ahead in the World Bank. strengthening regional environmental authorities. In Lao PDR the Hydropower Development Plan Washington, DC SEA resulted in the adoption of the “National Policy September 2012 * Available at: http://siteresources.worldbank.org/ENVIRONMENT/Resources/Env_Stratgy_2012.pdf 1 2 Str ategic Environmental Assessment in the World Bank chapter 1 Introduction Fernando Loayza1 Objective and Scope Methodology This report presents the results of a review of the Despite its tentative nature, the regional and World Bank’s strategic environmental assessment synthesis chapters were carried out following a (SEA) experience undertaken by the World Bank common methodology and a systematic review learning community—the SEA Community of process. Draft reports were circulated to the Practice (SEA CoP). The review included regional SEA CoP, the environmental assessment regional reviews that analyzed the World Bank’s SEA expe- constituencies, and environmental specialists at rience for all Regions in which the Bank is oper- the World Bank’s Environment Department. Then ating. These reviews were complemented by the the draft reports were presented in COP meetings production of a synthesis and conclusion chapter by the authors and commented on by designated to draw lessons and good SEA practices. discussants, some of whom were members of the SEA CoP. The main results of these discussions The review has been a vehicle for environmental were documented in minutes that were publicly assessment and sector specialists to dialogue disclosed to ensure transparency and to minimize about SEA practice in the World Bank (see potential inadequacies or inaccuracies. Verbal and Box 1.1). Ultimately, the review is an attempt to written comments informed the preparation of launch a process of continuous learning in order final reviews that led in some cases to substantive to strengthen the World Bank SEA capacity revision of the chapters. This systematic review in response to an increasing interest of client process was aimed not only at ensuring the quality countries in upstream environmental and social of the analytical work but also, more important, analytical work. Thus this report is no more than at fostering dialogue and reflection within the a first step. Its findings and results cannot be SEA CoP. treated as conclusive. Rather, they set a baseline upon which new and complementary learning activities can be undertaken over time. 1 Fernando Loayza is Senior Environmental Economist at the World Bank’s Environment Department. Introduction 3 Box 1.1 What is SEA in the World Bank’s Experience? The World Bank follows the Organisation for impacts against those of alternative options; that assess Economic Co-operation and Development in legal and institutional aspects relevant to the issues describing SEA as “analytical and participatory and impacts; and that recommend broad measures to approaches to strategic decision-making that aim to inte- strengthen environmental management in the region or grate environmental considerations into policies, plans the sector. REAs and sectoral EAs pay particular attention and programmes, and evaluate the inter linkages with to potential cumulative impacts of multiple activities. economic and social considerations� (OECD-DAC 2006). Policy SEA is a process to establish a policy dialogue for Originally, SEA was designed as an extension of envi- mainstreaming environmental and social considerations ronmental impact assessment (EIA) of projects to plans, in policy and sector reforms (see World Bank et al. 2011). programs, and policies. Over time SEA has become more Policy SEA can be applied for high-level plans and strat- strategic by bringing different groups of stakeholders egies and sometimes even for programs involving complex into an environmental and social dialogue in an iterative interventions that combine civil works with regulatory and and adaptive way. Most countries’ SEA legislation falls policy reforms. Policy SEAs have been used at the World under and extends existing EIA legislation to programs Bank to help in the preparation of technical assistance and plans. Many developing countries have recently projects and adaptable program loans and to inform and adopted legislation or regulations on SEA, and the use implement development policy loan (DPL) operations. of this assessment tool is increasing rapidly (Slunge and Policy SEA is process-oriented and influenced by institu- Loayza 2012). tional and political factors that shape policy formulation In the World Bank, SEA is mainly but not exclu- and implementation. sively known as SESA (strategic environmental and Country environmental analysis is a type of policy social assessment) to stress the inclusion and relevance SEA developed to inform the dialogue between the Bank of social issues as well as environmental ones. SEA/ and client countries on national environmental priorities. SESA is an umbrella term for assessment processes that “Rationales for preparation of CEAs can be broadly clus- aim to integrate environmental and social considerations tered in four areas: (a) to meet the requirements of the into strategic decision making by using impact-centered World Bank Operational Policy on [DPLs] (OP 8.60); (b) approaches that originated in EIA practice or policy SEA to provide an analytical basis for …environmental and approaches that are centered on institutions and systems sustainable development DPLs; (c) to strengthen or rees- for environmental and social management. tablish policy dialogue with a partner country on environ- Impact-centered approaches to SEA best fit to mental issues; and (d) to integrate environmental issues integrate environmental considerations in plans into a range of Bank or country-level processes such as and programs where environmental impacts and risks [country assistance strategies] and PRSPs� (Pillai 2008). can be identified and predicted. In Bank practice, these Hybrid SEAs that combine policy and impact- approaches have been used for large infrastructure centered SEA approaches have been used for basin projects like dams, power generation investment plans, management (strategic basin assessment), REDD+ and land use plans. However, several of these SEAs have readiness, and development corridors. A development resulted in long descriptions of environmental conditions corridor is the coordinated and synergic development of and potential risks that are of little use in decision making. investment projects to unleash the economic potential Regional and sectoral environmental assessments of a geographic area. In Mozambique, a programmatic (REAs and sectoral EAs) are impact-centered SEAs SESA including an umbrella policy SEA and three corridor- that have been widely used at the World Bank to comply specific SEAs is being undertaken to inform the prepa- with its safeguard policies. They are instruments that ration and implementation of the Mozambique Spatial examine environmental issues and impacts associated Development Planning Technical Assistance project. SESAs with a particular strategy, policy, plan, or program or with are mandatory for receiving grants to support REDD+ a series of projects for a particular region (e.g., an urban readiness. They are undertaken in an integrated way with area, watershed, or coastal zone) or sector (e.g., power, the preparation of the country’s REDD+ strategy. transport, or agriculture); that evaluate and compare the 4 Str ategic Environmental Assessment in the World Bank Authors of regional chapters had common terms The review was based mostly on secondary infor- of reference (see Box 1.2). There were three main mation and complementary one-on-one interviews questions to be addressed: on selected cases. The African, East Asian and the Pacific, and South Asian reviews also included ques- ■■ Whathave been the main drivers of Bank- tionnaires that were disseminated to regional EA supported SEA in the Region? constituencies. As a result, they list for the first time all SEAs undertaken by these Regions with support ■■ What are the main lessons learned and good of the Bank since the late 1990s. However, the practices for SEA effectiveness in the Region? regional reviews did not include fieldwork and gath- ering of primary information. The voices of govern- ■■ What are the implications of the review for the ments and civil society could not be heard in the future SEA agenda in the Region? review. Thus, unless already documented information Box 1.2 Generic Terms of Reference for Taking Stock of Bank Regional Experience in SEA Objectives The second section will focus on results and lessons learned. The discussion would be illustrated by SEA The main objective is to strengthen Bank staff’s capacity cases and guided by the following questions: on SEA by fostering learning in applying SEA in World �� What have been the results of using SEA? When Bank–supported projects and thus contribute to possible, distinguish between policy SEA and SEA of sustainable development outcomes in programs, plans, plans, programs, and large projects. Have decision and policies of client countries. making and strategic planning and sequencing been To achieve this objective, among other activities of the SEA influenced by the SEA? How? Has SEA created a space CoP, there is a component to take stock of the Bank’s recent for stakeholders to participate and voice their needs in regional experience with the following scope of work. decision making? How? Has SEA been used to examine and consider alternatives or priorities? How? Has Scope SEA been a vehicle for capacity building? How? Has SEA regional chapters will be prepared for all regions SEA been a vehicle for strengthening environmental in which the Bank is operating. The first section of the management systems such as the EIA system? How? chapter will take stock of the evolution of SEA appli- �� Whatanalytical and participatory approaches have cation in the Region with a view to selecting cases that worked best? Why? illustrate good practices. This section would address the following questions: �� What are the main factors that influenced the �� How has use of SEA in Bank activities evolved in success or failure of SEA? Have political and institu- the Region during the last decade? Have different tional factors such as involvement of civil society and approaches for policy SEA and SEA of plans, programs, nongovernmental organizations in SEAs had an impact and large projects been used? Has there been any on effectiveness? cross-sector application of SEAs? The third section of the report will present the recom- �� What have been the main drivers for SEA? Have drivers mendations for moving the regional SEA agenda forward. of policy SEA and SEA of plans, programs, and large It will identify regional priorities for action. It will also projects been different? Has use of SEA originated in include a discussion on the role of the ENV anchor, the the client country or in the Bank’s requirements, such as Region’s environment sector, and the regional safeguards compliance with OP 4.01, OP 8.60, etc.? team in enhancing SEA capacity in the Region. �� What are good practice cases of SEA preparation, including consultation and disclosure? Introduction 5 about results and impacts was publicly available, the the SEA literature. Other important issues in the reviews validated with key informants any additional literature, such as assessment of cumulative and information found on impacts of SEA activities. induced environmental and social impacts, are also discussed in the chapter but the findings are Involving Bank staff based in the Regions in not encouraging. The evidence points out that the review has proved difficult. While there is cumulative impact assessment and assessment major knowledge and capacity potential to be of induced development impacts have not been mined in the country offices—for example, to fruitful, and this has been leading impact-centered collect primary information on the impacts of EA SEA to a dead end. Uncertainty in predicting studies—there seems to be a lack of incentives complex social phenomena and adaptive behavior for local staff to engage in knowledge-generating would explain these poor results. activities such as the SEA CoP. If the World Bank is to become a knowledge Bank, the incentive The last section of Chapter 2 discusses proposals system to unleash this huge dormant knowledge for the World Bank’s SEA agenda building on the potential in the country offices warrants attention. proposals made by the authors of the regional Undoubtedly, looking ahead a major challenge reviews and the results of the meeting where the for the SEA CoP is how to reach out beyond envi- draft version of this chapter was discussed. ronmental and social staff based at Headquarters. Chapters 3 through 8 present the findings and conclusions of the regional reviews. Each one Structure of the report presents a unique and distinctive case that can be read as a standalone story; altogether they Chapter 2 presents the synthesis and conclusions provide a wealth of information on SEA practices. from the cross-analysis of the regional reviews. The chapters have been organized in a way that Considering the variety of factors that influenced is consistent with the evolution of SEA practice. SEA practice in the different Regions, it attempts Chapter 3 on the SEA experience in East Asia and to address the following questions: the Pacific focuses on the use of SEA mainly as a tool for environmental safeguarding. In contrast, ■■ Can a common trend in the evolution of SEA Chapter 4 analyzes the use of SEA as a planning practice in the Regions be identified? and policy tool drawing on the Middle East and North Africa experience. A mixed experience with ■■ Ifso, how has the role of SEA evolved in the impact-centered and policy SEA approaches is Bank business process? Why? described by Chapter 5 on South Asia. Interestingly, this Region shows a clear evolution of SEA practices ■■ Has the time come for SEA to become from impact-centered to policy SEA approaches. mandatory for specific Bank activities? Likewise, Chapter 6 on Sub-Saharan Africa shows a trend of using SEA initially for environmental safe- ■■ If so, what are the potential advantages and guarding but later for informing policy making. The disadvantages of this change? economic policy and legal context in shaping SEA practices is a distinctive feature of the reviews in After addressing these questions, the chapter Latin America and the Caribbean and in Europe and focuses on drawing lessons and good prac- Central Asia. Chapter 7 shows that sector reforms tices from SEA cases discussed in the chapters. and infrastructure developments have influenced Lessons based on robust evidence can be drawn the use of SEA in Latin America. And the mixed from the regional reviews in four areas: SEA results of promoting SEA practice by making it influence in decision making, promotion of multi- regionally mandatory through the European Union’s stakeholder dialogue, country ownership, and SEA Directive are described in Chapter 8 on Europe timing of the SEA. All these areas are relevant in and Central Asia. 6 Str ategic Environmental Assessment in the World Bank References OECD-DAC (Organisation for Economic Co-operation and Development–Development Assistance Committee). 2006. Applying Strategic Environmental Assessment: Good Practice Guidance for Development Cooperation. Paris. Pillai, Poonam. 2008. Strengthening Policy Dialogue on Environment—Learning from Five Years of Country Environmental Analysis. Washington, DC: World Bank. Slunge, D., and F. Loayza. 2012. “Greening Growth Through Strategic Environmental Assessment of Sector Reforms.� Public Administration and Development 32(3): 245–61. World Bank, University of Gothenburg, Swedish University of Agricultural Sciences, and Netherlands Commission for Environmental Assessment. 2011. Strategic Environmental Assessment in Policy and Sector Reform: Conceptual Model and Operational Guidance. Washington, DC: World Bank. Introduction 7 chapter 2 SEA Experience in the World Bank Synthesis and Conclusions Fernando Loayza2 People do behave in the same manner toward things, not because these things are identical in a physical sense, but because they have learned to classify things as belonging to the same group… In fact, most of the objects of social and human action are not “objective facts� in the special narrow sense in which this term is used by the [hard] sciences and contrasted to “opinions,� and they cannot at all be defined in physical terms. So far as human actions are concerned the things are what the acting people think they are. Hayek 1979, p. 44 2 Fernando Loayza is Senior Environmental Economist at the World Bank’s Environment Department. The author gratefully acknowledges written comments to an early draft of this chapter received from Adriana Damianova, Diji Chandrasekharan, Paula Posas, and Kennan Rapp. Valuable feedback was provided by members of the World Bank SEA Community of Practice and other colleagues who attended the 11 June 2012 meeting where a draft version of this chapter was discussed. 8 Str ategic Environmental Assessment in the World Bank The Evolutionary Nature of SEA making (Chapters 3, 5, 6, and 8). In two out of Practice in the World Bank five review meetings of the SEA CoP,3 when the discussion about the added value of SEA was A striking result of the regional reviews and at its highest, the meeting attendants asked the discussions of the strategic environmental themselves whether SEA was distracting efforts assessment (SEA) Community of Practice (CoP) and resources that could be best invested in is that SEA practice in the Bank largely evolved enhancing EIA practice—as one participant put spontaneously. Sometimes compliance with the it, “from EIA to SEA and now back to EIA.� There World Bank’s safeguards policies—mostly, but was no conclusive answer in these meetings. But, by no means exclusively, Operational Policy 4.01 as argued below, this limitation could be inherent (OP 4.01)—posed challenges to SEA practice in in the adaptive nature of the phenomena that the Bank’s operations. The need for SEA arose SEA attempts to assess using EIA methods that often from Bank projects with potential signif- were developed for the study of non-evolutionary icant impacts at a regional scale (such as when phenomena such as investment projects. a hydropower plan was prepared or river basin management was required), at a sectoral scale The Strategic Role of SEA as a (such as when several changes were planned in Priority Setting and Multistakeholder the investment plan and the regulatory and insti- Dialogue Process tutional framework of the water sector), or when the sheer size of an investment project required In other occasions, the push for SEA evolution the assessment of impacts at a national or regional has come out of the need to undertake upstream level. These SEAs (regional EAs and sectoral EAs) analytical work to inform policy reform and devel- mainly attempted to expand the understanding of opment strategies supported by the World potential environmental and social impacts beyond Bank. This SEA work was largely disconnected environmental impact assessment (EIA) practices from the World Bank’s safeguard policies, which in order to define adequate environmental and allowed Bank staff to try new approaches different social mitigation plans. Almost invariably, however, from assessing impacts and risks. In these new they faced difficulties in assessing cumulative approaches, the assessment of cumulative and impacts from existing and future projects within induced impacts could be avoided as there the sector or region under study or in assessing was no link to specific projects, given the high induced or indirect impacts over time. Uncertainty upstream level of the decisions under consider- about future developments has usually been the ation such as sector policies and development stumbling block. Also, access to information from strategies. Not surprisingly, in SEAs such as the other existing or planned projects has proved to Water Sector Adjustment Loan in 1999, the Palar be difficult. Basin (World Bank 2003), and the Colombia CEA, the approach taken was opportunistic as it meant The constraints on robustly predicting envi- using analytical and participatory approaches and ronmental and social impacts undermined in techniques that best fit the issue under consider- several cases the purpose for which SEA had ation. As Chapter 4 on the evolution of SEA in the been implemented in the first place. When SEA Middle East and North Africa (MENA) so clearly was unable to assess cumulative and induced illustrates, in some cases the gist of the SEA was impacts, the attempt to move environmental simply to highlight the cost of environmental impact assessment to a higher level would be degradation of existing policies as a percentage frustrated. Some SEA reports resulted in long and tedious descriptions of environmental and 3 These were the meetings where the draft reviews of the South Asia review (16 February 2012) and the East Asia and the Pacific review (22 social conditions with little relevance for decision March 2012) were presented and discussed. SEA Experience in the World Bank: Synthesis and Conclusions 9 of the gross domestic product. This attracted and cumulative impacts associated with a the attention of policy makers and Ministers of development decision, the stronger these Finance, leading to the incorporation of specific limits are felt. From a different perspective, environmental considerations in reform packages centered on policy processes and environ- to reduce pollution, such as reducing fuel mental management systems, policy SEAs subsidies in Egypt and Iran. are gradually increasing in Bank SEA practice (Chapters 4, 5, and 6). They are opening the Fostered by the adoption of Operational policy process to a variety of stakeholders and Policy 8.60 (OP 8.60) on policy lending, which influencing the policy dialogue between the specifically excludes the application of OP World Bank and client countries and between 4.01 on policy loans, and the World Bank’s governments and affected stakeholders. 2001 Environment Strategy, an analytical tool known as country environmental analysis (CEA) But this evolution is not free of tensions. For was developed from this emerging policy SEA instance, in some discussions within the SEA approach. In addition to being a vehicle to CoP, senior staff experienced in EIA perceived discuss national environmental priorities, CEA policy SEA as a planning tool with little if any rela- incorporates an institutional and policy gap tionship to environmental assessment practice. analysis to identify key weaknesses affecting Also, senior staff experienced in policy SEA environmental management in countries and were concerned about regulating SEA in the targeted sectors, and it recommends specific context of OP 4.01 because it could undermine capacity building and institutional strengthening policy SEA effectiveness. There are, however, actions (Pillai 2008). CEA use has extended reasons to expect a constructive resolution of across all Regions in the World Bank. In parallel, these tensions. The evolution of SEA practice in policy SEA also evolved into elaborated the Bank shows that these two approaches have policy dialogue approaches to support also had successful meeting points and, under sector reforms in client countries by drawing specific circumstances, can reinforce each other attention to environmental priorities, fostering for enhancing SEA effectiveness. a policy learning process through sustained stakeholder interaction, and facilitating access to Strategic basin assessment (SBA), an SEA-like information and empowerment of environmental assessment, combined elements of impact- constituencies (World Bank et al. 2011). In sector centered and policy SEA even before policy SEA policy SEA, socioeconomic assessment has gone was developed. With the aim of setting a common hand-in-hand with environmental assessment framework for managing water resources, the SBA (Chapter 5). of the Palar Basin in Tamil Nadu, India, developed detailed information on the environmental situ- What Makes SEA Effective? ation of the basin through consideration of economic and social issues (Chapter 5). This infor- Flexibility and Multiplicity of SEA Approaches mation was widely consulted by key public and civil society stakeholders. The discussions set the basis As the first generation of SEAs that developed for policy and institutional reforms that led, among out of efforts to scale up EIA approaches to other outcomes, to a shared vision of the problems higher levels of decision making showed, the and potential of the basin and an agreement on forecasting ability of practitioners has not the subbasin development and management plan improved significantly. There seem to be limits (World Bank 2003). for the use of impact assessment methodol- ogies in SEAs, particularly for assessing and More recently, the Forest Carbon Partnership forecasting cumulative and induced impacts. Facility (FCPF) supports countries’ efforts to The greater the need for assessing the induced become ready for REDD+ (reducing emissions 10 Str ategic Environmental Assessment in the World Bank from deforestation and forest degradation).4 methods became evident, particularly when evalu- Building on the Bank’s experience in environ- ation of induced and cumulative impacts is critical mental assessment and policy SEA, the FCPF in the assessment. Consequently, in response requires beneficiary countries to conduct stra- to needs from client countries, SEA methods tegic environmental and social assessment and process evolved away from EIA practice. (SESA). The SESA for FCPF consists of two largely Identification of environmental and social priorities, sequential stages that combine policy SEA and often highlighting the economic cost of pollution impact-centered approaches. In the first stage, and natural resources degradation, substituted for a policy SEA—which includes an extensive and impact scoping. Assessment of potential impacts comprehensive consultation and participatory and risks was replaced by analysis of the institu- process—is undertaken to integrate environ- tional framework and existing systems for environ- mental and social considerations into the prep- mental and social management. In lieu of project aration of a country’s REDD+ strategy. Out of consultation, public participation as a process to a recognition that at that moment a compre- engage multiple stakeholders in dialogue, nego- hensive assessment of potential impacts and risks tiation, and deal making has been established in arising from the REDD+ strategy is not feasible, cutting-edge SEA practice. the preparation of an environmental and social management framework (ESMF) compliant with A characteristic of this evolutionary path has the relevant World Bank safeguard policies is been the variety of approaches that have been left for the later steps of the SESA process. The used and tested over time. This is reflected in the ESMF lays out the processes and procedures for variety of names used for SEA approaches in the managing potential environmental and social World Bank. Policy SEA approaches also have impacts of specific policies, investments, and adapted to the boundaries set by the World Bank actions to be undertaken during subsequent safeguard policies through the SESA for the FCPF, phases of REDD+, when the country implements in which policy and impact-centered approaches its finalized REDD+ strategy. SESAs for FCPF are complement each other. now under way in at least seven countries, but it is in the initial stages in all but the Democratic Continuous Adaptation and Learning Republic of Congo, and no ESMF has yet been drafted. While the effectiveness of this approach SEA also evolved by adapting to changing that combines policy SEA and ESMF remains to circumstances in the political and cultural be seen, this adaptation by the FCPF shows that contexts in which it has been applied. policy SEA and impact-centered SEA approaches Sometimes policy SEA was a response to can complement each other in order to promote the demand for structural reform, as in Latin environmental and social sustainability at America. In other cases policy SEA was different levels of the decision-making ladder. confined to analytical work to inform the World Bank and country dialogue, as in MENA. But in The insight that comes out of studying the evolution this Region the Arab Spring is now permeating of SEA practice in the World Bank is that although public participation in SEA practice. Ultimately, SEA originated in EIA practice, it is not a scaled- the adaptive evolution of SEA practice in the up version of EIA methods and techniques. As World Bank seems to originate in the fact that SEA practice accumulated, the limits of using EIA upstream decision making, such as devel- opment and sector policy, evolves through the 4 Tropical forest countries from four major world regions are receiving actions of different persons and organizations support from the FCPF Readiness Fund for strategic planning, interin- stitutional coordination, and capacity building activities of the type that in a process of mutual continuous adaptation. will render them “ready� to receive performance-based payments for This may explain why potential cumulative and actions that will lead to reduced deforestation and forest degradation and better, more sustainable forest management (REDD+). The FCPF is induced impacts can hardly be assessed in structured as a multidonor trust fund for which the World Bank serves as Trustee, Secretariat, and one among several Delivery Partners. advance in SEAs. SEA Experience in the World Bank: Synthesis and Conclusions 11 Unlike project EIA, SEA is not under the control and policy making. Its effectiveness is ultimately of an individual (the owner of the project) whose measured through its ability to integrate environ- actions can be predicted or defined. Also, this is mental and social considerations in plans, policies, why SEA cannot be reduced to a procedure for sector reforms, and national development strat- the preparation of a report on which a permit egies. This report shows that SEA as an environ- can be issued. Public participation and social mental governance tool has been increasingly learning are as critical for effective SEA as they used in sectors of high environmental and social are for effective policy making (Ahmed and risks, such as water, forestry, and mining (Chapters Sánchez-Triana 2008; World Bank et al. 2011). As 5, 6, and 7). Here, the greatest strength of policy the evolution of World Bank practice is demon- SEA has been to facilitate dialogue, negotiation, strating, SEA is a process that convenes multiple and agreements among multiple stakeholders on stakeholders through interactive modes of public environmental sustainability that are supported by involvement to facilitate adaptive learning. good analytics. Again, making this policy dialogue mandatory, as in the case of the SESA for the As a result of this evolutionary adaptive approach, FCPF, would significantly increase the use of SEA SEA has a dual role in the World Bank. First, across the Bank and would likely gain the support it is an environmental assessment instrument of civil society. But a mandatory process requires that client countries can choose to comply with a clear definition of requirements, procedures, OP 4.01. During the discussion of the SEA CoP and standards, which directly affects the ability of meetings, the question arose about whether to SEA to adapt and evolve. The SESA for the FCPF keep the optional character of SEA as a safe- cannot necessarily be adapted to other sectors or guard instrument or to make SEA a safeguard policy challenges. requirement for certain types of operations focusing on policy or upstream technical assis- The trade-off between regulating SEA and tance. While there is no doubt that making SEA keeping it adaptive and flexible cannot be a requirement for certain types of World Bank considered in isolation from the evolutionary operations would widen its use across the Bank, nature of SEA. This is a main finding of this report it would be counterproductive if it came at the and the discussions of the SEA CoP. Yet the way price of curtailing SEA flexibility. As this analysis in which this trade-off is addressed would likely has shown, SEA’s greatest strengths are its evolu- affect the place that SEA could have in the World tionary adaptive nature and its ability to facil- Bank’s business model. All regional reviews itate interactive modes of public involvement. confirm the need for SEA as an important sustain- Restricting SEA to a standard process would ability tool. But whether SEA should be regulated impair its effectiveness and potential, as happened under the umbrella of the Bank’s environmental with SEA practice in the European Union (EU), and social safeguard policies remains unclear, as which was heavily regulated by the SEA EU the implications for SEA effectiveness are not yet Directive (Chapter 8). SEA is likely to continue fully understood. Continued application of an evolving. As discussed in this report, the expected adaptive evolutionary approach in using SEA in outcome of an effective SEA can be defined,5 but the Bank’s activities seems the most sensible way the process to achieve this outcome is essentially ahead. If a regulated SEA is restricted to specific a response to the internal and external factors that and well-defined processes such as the FCPF- shape SEA adaptive behavior. supported Readiness Preparation, the potential advantages and disadvantages of this course of SEA, especially policy SEA, is also an environ- action will be better understood over time. For mental governance tool that feeds into planning other uses of SEA in the Bank’s activities, keeping SEA flexible and using it as a development rather 5 For example, the process outcomes of policy SEA are greater attention than a regulatory instrument would be consistent to environmental priorities, strengthened constituencies, improved social accountability, and policy learning (World Bank et al. 2011). with the findings of this review. 12 Str ategic Environmental Assessment in the World Bank Lessons and Good Practices Possibly influenced by the successful results of this type of SEA, EA practice in the Bank has This section analyzes the results of the regional evolved to include the increasing use of the envi- reviews from the perspective of SEAs’ influence ronmental and social management framework. in decision making, their ability to establish An ESMF establishes a unified process appli- multistakeholder frameworks, and their capacity to cable to development project designs that entail promote country ownership. The results provide subsequent funding for multiple, small-scale lessons on how and when SEA approaches can subprojects whose exact nature and location is be effective. The section finishes by challenging not known at the time of project appraisal (World the assumption that timeliness is critical for SEA Bank 2005). This unified process addresses all effectiveness because it shows that the higher we environmental and social safeguards issues on move up in the decision-making ladder, the more subprojects—from preparation through review SEA faces a continuous process of decision making and approval to implementation. Effective without a clearly defined beginning or end. implementation of an ESMF ensures that the substantive concerns of all applicable World Bank Influence in Decision Making safeguards policies are satisfactorily addressed. Although the regional reviews found mixed Less common across regional practice than results on the influence of SEA in decision the ESMF role has been the use of SEA as a making, there is enough evidence to identify tool for alternatives analysis, which has also situations in which SEA is likely to be influential. been influential in decision making. In these Also, good practices on making SEA influential SEAs, investment alternatives are identified and can be identified. In the following discussion, the assessed against sustainability criteria in order to analysis of these results is facilitated by discussing inform the selection of an optimal or adequate impact-centered SEA separately from policy SEA. choice. Some relevant examples identified in the regional reviews are the SEA for the Ghana Impact-centered SEA: ESMF and Micro, Small, and Medium Enterprise Project; the Alternatives Analysis Santiago Urban Transport SEA; and the Water and Sanitation SEA for the Dominican Republic. Impact-centered SEAs have been influential when A good practice in using SEA for alternatives they provide a framework to assess environ- selection is illustrated by the Nepal Medium mental and social impacts of programs in which Hydropower Sectoral EA (Chapter 5). In this the investment activities are not fully defined exercise, screening and ranking of alternatives was and identified at appraisal (when the World the backbone of the sectoral EA. From a national Bank operation is assessed internally). This has inventory of 138 sites suitable for medium-scale been the case, for example, for the SEA for the hydropower, 7 sites were selected as of high Kenya Education Sector Support Program; the acceptability through a two-staged assessment Strategic Environmental, Cultural Heritage and process that considered technoeconomic, social, Social Assessment of the Regional Development and environmental parameters. The SEA added Strategy of Kakheti; the sectoral EAs of Tamil value by helping decision makers discard more Nadu, Karnataka, Kerala, Uttar Pradesh, Mizoram, than 90 percent of the sites, and only the selected and Manipur Highway Projects; and the regional 7 sites proceeded to the feasibility stage. environmental assessment for the Mindanao Rural Development Project. The SEAs contributed to Policy SEA: Expanding Policy Horizons, Public decision making by providing an environmental Participation and Accountability management framework to screen potential invest- ments under the Bank operation that informed the Analysis of the influence of SEA in policy making selection of investment projects down the pipeline. requires acknowledging the continuum of policy SEA Experience in the World Bank: Synthesis and Conclusions 13 making (Ahmed and Sánchez-Triana 2008; World SEAs, the emphasis is still on the production of Bank et al. 2011). Any policy SEA faces a situ- a report. It is assumed that in order to influence ation in which the existing state of policy affairs decision makers, a high-quality piece of analytical is accepted (policy status quo), the existing work is required (Sánchez-Triana and Enriquez policies are called into question (policy review), 2006). Consultations are treated as instrumental or the policy is being changed (policy reform). to the preparation of the SEA report. Stakeholder Influencing policy making will mean different analysis, political economy, and the strengthening things in each situation. of environmental and social constituencies are not yet at the core of the SEA process. Examples Under conditions of policy status quo, the regional are the Water and Sanitation Sector SEA in experience shows that SEA could often bring Colombia, the Water Sector Reform in Argentina, about planning or policy recommendations to and the Energy and Environment Reviews of improve environmental and social sustainability Egypt and Iran. through raising awareness and changing atti- tudes toward sustainable development. One Arguably the most influential policy SEAs are example of this is the SEA of the National Spatial responsive to a situation of policy review by Plan in Montenegro that affected the attitude linking environmental and social priorities to and capacity of some stakeholders positively, economic or development outcomes, by giving but it fell short of making an impact on institu- centrality to the SEA as a process by engaging tional capacities (Chapter 8). Similarly, the SEA key stakeholders in a policy dialogue, and by for the Hubei Road Network Plan 2002–2020 sustaining the SEA process during policy reform increased awareness of senior managers at the through a policy loan. An emblematic policy SEA Hubei Provincial Communication Department is the Colombia CEA that between 2005 and about macro-level environmental implications of 2009 influenced a series of development policy road transport. It also showed the advantages of loans (DPLs) by highlighting that pollution and sharing data in the context of a rigidly compart- environmental degradation had an estimated mentalized subsector planning culture (Chapter 3). cost of 3.7 percent of gross domestic product and caused approximately 6,000 deaths annually, In some cases, when conditions for policy review especially of children. The CEA also showed are maturing, the SEA may widen an opportunity that the environmental priority setting process for policy reform. This appears to be the case in was disconnected from investments made in the India CEA that influenced policy on environ- regional and local jurisdictions. Consequently, mental governance by highlighting the need to it suggested a set of policy and institutional improve access to information, empowering local strengthening recommendations that were taken governments, and establishing clear account- on board by the DPLs. More recently, the Gulf ability mechanisms. As a result, the India CEA has Environmental Partnership and Action Program been influential in several Bank projects, and it (GEPAP) incorporates the following key policy elevated environmental and social accountability SEA principles in its design (Chapter 4): priority issues in the country assistance strategy (Chapter 5). ■■ Address priority environmental issues at the regional level to be implemented at the Among the first policy SEAs supported by the national level World Bank are those that attempted to influence policy in a context of policy reform. Their ■■ Underpin policy and institutional issues of envi- strengths were translating environmental issues ronmental sustainability on environmental asset into economic and environmental health effects valuation methods to clarify the importance of and the application of cost-benefit analysis to protecting and restoring environmental quality evaluate policy options. In these initial policy 14 Str ategic Environmental Assessment in the World Bank ■■ Expand the Gulf environmental community to Assistance Project. Accordingly, through effective include sector ministries, private and financial public participation, SEA can open policy sectors, and civil society through environmental and planning processes to broader groups of education and communications based on Gulf stakeholders, empower traditionally sidelined regional priorities constituencies, enhance quality of outcomes, and strengthen monitoring. If achieved, these ■■ Increase consultation and communica- outcomes by themselves justify the use of SEA. tions among Gulf countries and stakeholders to prioritize actions and define the GEPAP However, the regional reviews and discussions investment portfolio about them within the SEA CoP also showed that effective SEA public participation is not ■■ Share lessons with similar international waters free from challenges. Identifying who is to be initiatives. consulted or who is “the public� is a major chal- lenge in upstream SEA processes. Even when Multistakeholder Dialogue stakeholder analysis through techniques well known to social scientists (see, for example, The critical role of public consultation and partici- World Bank et al. 2011) helps in identifying “the pation in effective SEA is now commonplace. public,� the reviews found that two problems Increasingly, SEA practitioners agree that the SEA were likely to emerge. Usually, stakeholders come process is more important than the SEA report to the policy or planning dialogue with vested or for influencing decision making and planning group interests. Distilling a common good from (IAIA 2011). This sets public participation and competing and sometimes conflicting interests is multistakeholder frameworks at the core of SEA not easy. One way to ease political tensions could effectiveness. Not surprisingly, all the regional be stressing that SEA is a recommended rather reviews stressed the importance of meaningful than a mandatory process of policy dialogue, public participation in SEA. Even in MENA, where as happened in the SEA of the Nam Theun 2 in consultation at the strategic level was limited to Laos (see also Morgan et al. 2009). Furthermore, government officials, public participation was SEA teams need to be strengthened by incorpo- an attractive SEA feature because it could help rating social and political specialists capable of address the demand for civil society participation managing political economy challenges. as a result of the changes brought about by the Arab Spring. Another problem that came up was how to attract the attention of grassroots stakeholders The regional chapters identified the main advan- to SEA consultations, as environmental and social tages of public participation processes. Public impacts from strategic decision making are not participation provides stakeholders with an always tangible and may not affect them directly entry point to voice their needs in planning and (Chapters 3 and 5). In the Strategic Environment, policy making. This was the case, for instance, in Cultural Heritage, and Social Assessment of the the Regional Environmental Assessment of the Kakheti Regional Development Plan in Georgia, Manila Third Sewerage Project. More specifi- local communities were not interested in the cally, public participation at the policy level was environmental aspects of the plan but were found to empower weaker stakeholders, particu- concerned about resettlement and job opportu- larly the poor. In the Europe and Central Asia nities. One way to address such disinterest is to (ECA) Region, where SEA practice has been design the SEA process with attention to specific mostly impact-centered, public involvement has concerns of local communities, as in the SEA of the potential to enhance quality control and the Palar Basin. Here the challenge was to strike assurance of the SEA process, as happened in a balance between strategic and local priorities the SESA of the Kosovo Lignite Power Technical and concerns. A balanced representation of civil SEA Experience in the World Bank: Synthesis and Conclusions 15 society between grassroots groups and institu- participation in the West Bengal Sundarbans tional stakeholders such as nongovernmental established around agreed priorities are likely organizations (NGOs) and civil society organiza- to be responsive to stakeholders’ concerns and tions (CSOs) can also help because institutional interests and to keep them engaged in the SEA stakeholders are more are likely to have a broader exercise. They are also means to ensure stake- and more strategic perspective. This requires, holders’ representativeness and the legitimacy of however, that the priorities of institutional and the public participation process. grassroots stakeholders are accounted for sepa- rately during the SEA process (see Box 2.1). Good practices for SEA public consultation are being developed by the SESA for the FCPF. All in all, there is a need to invest considerable Among other elements, these consultations time and resources in the preparation and include the following. implementation of public participation in SEA. As reported in Chapter 5, a multistakeholder stakeholder platforms for sector or ■■ Existing framework and a structured plan for stakeholder thematic dialogue are used for SEA. Box 2.1 Consultations in the West Africa Mineral Sector Strategic Assessment (WAMSSA) Consultations for WAMSSA consisted of: �� National workshops in capital cities to select WAMSSA’s priorities, validate WAMSSA’s main findings, and �� Focus groups meetings for industry, government, and propose policy recommendations. civil society in the capital cities of Guinea, Liberia, and Sierra Leone Seven priority issues were identified. The priorities of insti- tutional stakeholders coincided only partially with those of �� Mining community surveys in 10 communities selected community stakeholders. WAMSSA accounted for these across these three countries, which were representative differences throughout the SEA exercise. (A similar finding of the breadth, depth, and diversity of communities was reported for the Colombia CEA in the different affected by mining-infrastructure developments cultural context of Latin America.) Priority issues Institutional Community stakeholders stakeholders Environmental Issues Deforestation and loss of biodiversity X Land degradation and need for reclamation X Social Issues Poverty in mining areas X Governance Issues Insufficient transparency/consistency of decision X X making Lack of capacity X X Disenfranchisement of local communities X X Rent-seeking behavior X Source: Adapted from World Bank 2010 and Annandale 2011. 16 Str ategic Environmental Assessment in the World Bank For example, in Mexico the SESA process is A common feature in the reviews is the rather low mainstreamed into the national climate change demand for SEA compared to EIA from client coun- strategy preparation process. tries, although this trend seems to be slowly but consistently being reversed. Most SEAs have been ■■ Depending on the scope and complexity of the supported or required by the Bank, following a trend consultation process, multistakeholder working in which donors pushed for the SEA agenda during groups are established to steer and oversee the 2000s. According to Cadman, Fragano, and implementation of the consultation and public Mathur (Chapters 6, 7, and 3), the main factor behind participation (CPP) activities. this sluggish demand is the absence of SEA as a legal requirement in the preparation of government ■■ The CPP plan establishes rules for validating programs, plans, and policies. For example, in representativeness of stakeholders, criteria for the Bank’s experience in East Asia and the Pacific engaging new stakeholders during implemen- (EAP), SEA is many times seen as an unnecessary tation to ensure legitimacy of the CPP process, and bureaucratic step that takes time and resources and rules to be followed to reach agreements in away from an already limited and overstretched EIA the course of the SEA implementation. The CPP capacity. Although this perception relates to impact- plan is adopted during an initial workshop to centered SEA, it also reaches policy SEA because launch the SEA process. the benefits that the latter could bring to decision making are not well understood. The expectation is ■■ Inthe selection of SEA priority issues or that by regulating SEA and making it mandatory for preferred alternatives, the preferences of specific Bank-supported activities, the practice will grassroots stakeholders (communities) are increase, teething problems will be overcome, and distinguished from the preferences of insti- SEA will be as accepted as EIA is today. tutional stakeholders (government, NGOs, CSOs, etc.). However, the ECA review calls this expectation into question. Even though SEA is mandatory in ■■ CPP activities are designed and implemented the European Union, Chapter 8 reports limited in a culturally sensitive way. Participatory rural buy-in by East European countries, where appraisal is the main vehicle for identifying common problems are delays and a lack of time key environmental and social issues at the and resources for undertaking SEA. According community level. While surveys and one-off to the authors of this chapter, the problem meetings at the community level have been originates in the limited awareness of decision a step in the right direction, effective CPP makers and insufficient capacity and resources in communities requires a longer “face-to- for undertaking SEA. While this might be so, face� time and less intimidating surroundings. it is also possible that impact-centered SEA Reporting back is also critical for effectiveness approaches have fallen short of delivering the (World Bank et al. 2011). expected sustainability benefits at the strategic level in ECA. The need for systematically applying Country Ownership alternative approaches such as policy SEA could be part of the solution. The lesson here would In line with the literature on SEA, the regional be twofold. On the one hand, mandatory SEA reviews highlight the importance of country does not ensure country or government buy-in ownership for effective assessments. Although of the SEA process but facilitates an enabling the reviews did not dwell on whether country environment for SEA use. On the other hand, ownership included civil society and the private any legal basis for SEA that the World Bank may sector as well as the government, country promote in client countries should be flexible ownership in the reviews implicitly refers to enough to facilitate experimentation with government ownership. different SEA approaches. SEA Experience in the World Bank: Synthesis and Conclusions 17 Over the last decade there have been some to delays in completing the assessment. The encouraging results with countries ownership of lesson here is not new: the appropriate time for SEA and demand-driven SEA. The World Bank undertaking impact-centered SEA approaches is has learned that rather than Bank activities, SEAs when plans and programs are being prepared. and CEAs are more effective as country activ- ities that need support for awareness raising Less Important Factor in Policy SEA and capacity building (World Bank et al. 2011). Climate change is posing challenges for risk and Timeliness in policy SEA does not have a vulnerability management that require program- substantive meaning, however, as policy is a matic responses and modeling of future scenarios continuum. The timeliness in policy SEA could be amenable to SEA methods (Chapters 3 and 7). This linked to the special periods when a window of is creating a country-driven demand for SEA in EAP opportunity for policy review and reform is opened. and in Latin America and the Caribbean (LAC), It can be expected that policy SEA could be more as attested by the CEA in Indonesia that focused effective if it started at a time when a window of on climate change and the broader use of SEA in opportunity is opened. But the regional reviews Mexico for climate change adaptation in Michoacan did not provide enough evidence to be conclusive and Campeche and for climate change mitigation on this matter. While this would be the case for the through REDD+. As reported in Chapter 7 in LAC, Pakistan Green Industrial Growth SEA and the stra- following a reduction of Bank-supported SEAs tegic environmental, poverty, and social assessment (mainly through CEAs) as funds for supporting CEA of Pakistan Freight Transport Reforms (Chapter 5), activities dried up, there has been a modest revival policy SEA could still be influential during imple- in interest in SEA—but this time country-driven as, mentation, as in the SEA of the Kenya Forest Act among other things, Brazil, Chile, and Peru have (World Bank et al. 2011) and in the strategic impact adopted the legal basis for SEA. assessment of the Nam Theun 2 Hydroelectric Project, Lao PDR (Chapters 6 and 3). Timing The lesson is that timing in policy SEA is a less Critical Factor in Impact-Centered SEA critical factor for effectiveness than other factors, such as the establishment of multistakeholder The Sub-Saharan Africa (AFR), EAP, ECA, and frameworks or country ownership of the SEA South Asia (SAR) chapters have identified process. The operational implication for the the timing of SEA as an important factor in World Bank’s operations would be that policy effectiveness. These reviews, however, do not SEA can be used more flexibly than impact- differentiate timing in impact-centered and centered SEA whenever conditions are favorable policy SEA. In line with the SEA literature on to include environmental and social consider- impact-centered SEA, it is assumed that the ations in the policy dialogue right from the prepa- results of the SEA report are the main mechanism ration of country partnership strategies through for influencing the preparation of programs to the implementation of DPLs or other lending and plans. Consequently, the usefulness of instruments, such as technical assistance loans. the SEA findings and recommendations would reduce significantly during plan and program implementation—as has happened in EAP, where Strengthening the World Bank’s the Bank has often been invited to participate SEA Agenda at the project stage after strategic decisions have already been taken, particularly in China. The regional chapters propose regional SEA Likewise, the influence of the Lake Victoria agendas. Summarizing these agendas is not Regional Transboundary Diagnostic Analysis straightforward because they are influenced by and Strategic Action Program was impaired due an array of different factors, such as the history 18 Str ategic Environmental Assessment in the World Bank of the World Bank’s support on SEA in the just China, the environmental assessment agenda Region, the level of development of the Region, in EAP centers on large infrastructure projects. and regional priorities. Any cross-regional trend The implementation of the EU SEA Directive should therefore be approached with caution. and the Espoo Convention will continue driving Nevertheless, it is possible to identify some SEA in ECA. In MENA, the value of SEA would broader cross-regional elements of interest for likely be tested for its ability to introduce public the SEA CoP in promoting an SEA agenda for the participation approaches in countries unfamiliar World Bank. with these practices at the planning and policy- making levels. Table 2.1 shows that potential entry points for the Bank to support SEA are varied across Unlike the disparate entry points at the regional Regions. In Africa, the priority would be strength- level, all regional reviews point to the need ening environmental safeguarding yet moving for SEA capacity building. In AFR, EAP, and beyond it toward supporting decision making MENA, this need would be strong. Capacity for sustainable development. In LAC and SAR, building is largely seen as the vehicle to reverse climate change offers a concrete opportunity critical constraints to scale up SEA, such as for moving the SEA agenda ahead. In EAP, weak capacity for environmentally and socially ECA, and MENA, the agenda on SEA would be sustainable planning, lack of resources in client dominated by Region-specific issues. Given the countries and the Regions to expand SEA use, impressive growth of several EAP countries, not very limited use of SEA during the preparation Table 2.1 Key Elements of Proposed Regional SEA Agendas Region Potential Entry Awareness Capacity Knowledge Comments/ points raising building sharing priorities AFR Environmental safeguarding Focus capacity building on of development initiatives core growth sectors Upstream tools for X XX Promote SEA as a tool for sustainable development strengthening country systems EAP Upstream (macro-level) Establish “centers of excel- decision making lence� on social and environ- XX X mental issues in infrastructure Large infrastructure projects and programs ECA Assist in the implementation Several Bank projects already of the SEA EU Directive and X X identified Espoo Convention LAC Subnational planning (state Enhance coordination on SEA and municipal levels) with IDB and IFC based on X XX complementary strengths* Climate change mitigation and adaptation MENA Existing strong engagement Focus on facilitating public in supporting national EIA XX X participation in strategic systems decision making SAR Addressing environ- Policy SEAs offer great mental health impacts in potential sector reforms XX X XX Assist countries in developing Vulnerability to extreme National SEA systems climate change events XX: strongly recommended; X: recommended * IDB–Inter-American Development Bank; IFC–International Finance Corporation SEA Experience in the World Bank: Synthesis and Conclusions 19 of country partnership strategies, and poor The following is expected to come from enabling context for the emergence of SEA this department: champions. Awareness raising appears today to be less important, possibly as a result of previous ■■ Dissemination of global knowledge on SEA work undertaken by the donor community, the multilateral development banks, and the World ■■ Promotion of South-South knowledge exchange Bank itself. ■■ Development of SEA guidance and tools for The interesting element is that four regions—EAP, specific sectors and assessment challenges, LAC, MENA, and SAR—have given priority to such as climate change adaptation intra- and inter-regional SEA knowledge sharing. This is an indicator of the potential demand for ■■ Continued high-level support and access to South-South knowledge exchange on SEA. In resources such as trust funds for capacity discussions of the SEA CoP, it was highlighted strengthening in SEA and CEA. that South-South lessons and knowledge efforts can focus on social learning. This would facilitate the creation of adaptive mechanisms Final Remarks for reviewing the impacts of policies, plans, and programs on priority social and environmental When the draft version of this chapter was issues. As an adequate social learning space is discussed by the SEA CoP, the following issues required for achieving the long-term sustainability for a future knowledge and dissemination agenda impacts of SEAs, enhancing the understanding of this community were suggested: of how such space is created when most country systems do not allow for it is important. This ■■ How does SEA practice in the Bank compare requires drawing not only on lessons from SEA with international practice? experiences but also on other efforts, whether in the broader governance space, the disaster risk ■■ What innovations in SEA are on the horizon? management space, or somewhere else. In the United States, for example, the Bureau of Land ■■ ShouldSEA use in the Bank be reframed to Management applies adaptive land management. achieve more sustainable development? There may be lessons from this experience applicable to SEA. ■■ How does SEA relate to emerging issues and tools such as green economy, low- Considering that SEA is being legally adopted emission development strategy, and natural by client countries as a tool for environmental capital accounting? and social integration into programs, plans, and policies, assessing the role of SEA in enhancing ■■ What are the sectors in which SEA has not the environmental and social sustainability of taken off? Why has this happened? DPLs and program-for-results operations was suggested. This would require the SEA CoP to ■■ How can influence be sustained after an SEA help develop a platform for common analysis is completed? and reflection between the environmental and operations policy and country services families of ■■ What can be learned from SEAs that have the World Bank. informed country partnership strategies? Reasonably in line with the regional SEA agendas, ■■ How can the work in the report be used for SEA the role of the Environment Department would training? How can the report be transformed be to facilitate the learning SEA agenda. into a learning tool? 20 Str ategic Environmental Assessment in the World Bank ■■ Would it be possible to create a positive and As this chapter was being prepared, the regional negative list of when to use and not use SEA? reviews of Africa and Latin America were presented at the 32nd Annual Conference of the ■■ Are there any improvements that can be made International Association for Impact Assessment to the OP 4.01 policy references to SEA to (IAIA) held in Porto, Portugal (27 May – 1 June strengthen SEA/SESA practice? 2012) and at the Symposium on SEA held in Maputo, Mozambique (25–27 April 2012). Also, ■■ How can the Bank be more systematic in maxi- dissemination of this report outside the World mizing SEA’s potential for effective monitoring Bank is initially planned at the 17th Annual and follow-up? Conference of the IAIAsa (IAIA South African Affiliate) to be held in August 2012 in Cape Town, ■■ How should new champions for SEA be found South Africa. These are indicators that the SEA and supported in the poverty reduction and CoP could become a hotbed of SEA champions economic management vice-presidency—the within the Bank. If this momentum is sustained, “unusual suspects�? this may be the dawn of a new wave of adaptive development evolution in World Bank-supported ■■ How can the SEA CoP best advocate for and SEA activities. locate funds for continued financing and support of SEAs? References Ahmed, K., and E. Sánchez-Triana, eds. 2008. Strategic Environmental Assessment for Policies: An Instrument for Good Governance. Washington, DC: World Bank Annandale, D. 2010. The West Africa Mineral Sector Strategic Assessment (WAMSSA). Evaluation of the World Bank’s Pilot Program on Institution- Centered SEA. Unpublished paper. Washington, DC: World Bank. Hayek, F. 1979. “Scientism and the Study of Society.� In The Counter-Revolution of Science: Studies in the Abuse of Reason, 2nd ed., pp. 17–182. Translation by J. Kahane. Indianapolis, IN: Liberty. IAIA (International Association for Impact Assessment). 2011. “SEA Implementation and Practice: Making an Impact?� Conference held in Prague, Czech Republic, 21–23 September. Morgan, G., F. Loayza, and H. Kobayashi. 2009. Lao PDR Nam Theun 2 (NT2) Hydroelectric Project SEA Case Study. Environment Notes No. 2. Washington, DC: World Bank. Pillai, Poonam. 2008. Strengthening Policy Dialogue on Environment—Learning from Five Years of Country Environmental Analysis. Washington, DC: World Bank. Sánchez-Triana, E., and S. Enriquez. 2006. Using Strategic Environmental Assessments for Environmental Mainstreaming in the Water and Sanitation Sector—The Cases of Argentina and Colombia. Environment Strategy Note No. 15. Washington, DC: World Bank. Sánchez-Triana, E., K. Ahmed, and Y. Awe, eds. 2007. Environmental Priorities and Poverty Reduction. A Country Environmental Analysis for Colombia. Washington, DC: World Bank. World Bank. 2003. Palar Basin SEA Workshop Proceedings Report. Washington, DC. ———. 2005. Environmental and Social Management Framework for World Bank Projects with Multiple Small-Scale Subprojects. A Toolkit. Africa Region. Washington, DC. ———. 2010. West Africa Mineral Sector Strategic Assessment (WAMSSA). An Environmental and Social Strategic Assessment of the Mineral Sector in the Mano River Union. Washington, DC. World Bank, University of Gothenburg, Swedish University of Agricultural Sciences, and Netherlands Commission for Environmental Assessment. 2011. Strategic Environmental Assessment in Policy and Sector Reform: Conceptual Model and Operational Guidance. Washington, DC: World Bank. SEA Experience in the World Bank: Synthesis and Conclusions 21 chapter 3 World Bank SEA Experience in East Asia and the Pacific A Tool for Environmental Safeguarding Aradhna Mathur6 Mongolia China Rep. of Korea Lao P.D.R. Myanmar Vietnam Cambodia Thailand Philippines Marshall Islands Malaysia Palau Fed. States of Micronesia Kiribati Papua Indonesia New Solomon Guinea Is. Timor-Leste Samoa Vanuatu Fiji Tonga 6 Aradhna Mathur is a consultant. The author is grateful to Juan David Quintero and Peter Leonard for providing guidance, feedback, and support, without which this review would not have been possible. Gratitude is also expressed to Jian Xie, Maya Villaluz, Douglas Graham, Son Van Nguyen, Andrew Sembel, Josepho Tuyor, James Monday, Knut Opsal, Xiaoxin Shi, and Tom Walton for their inputs. Fernando Loayza provided insights and valuable suggestions. Thanks also go to the World Bank SEA Community of Practice for sharing their experiences and offering constructive feedback on the chapter. 22 Str ategic Environmental Assessment in the World Bank Introduction and Methodology Evolution of SEA in East Asia and the Pacific This chapter aims to take stock of the evolution of strategic environmental assessments (SEAs) in Environmental legislation has existed in the EAP the East Asia and Pacific Region (EAP), discuss Region since the 1970s. Environment impact lessons learned using SEA case studies, and assessment (EIA) legislation has matured and provide recommendations for SEA moving forward evolved over the years, with the degree and in EAP. This diverse region includes Cambodia, quality of environmental assessment practices China, Fiji, Indonesia, Kiribati, the Republic of varying greatly between countries. SEA has Korea, the People’s Democratic Republic of evolved from EIA experiences, and as a result SEA Lao (Lao PDR), Malaysia, Marshall Islands, FS practice also varies from country to country. SEA Micronesia, Mongolia, Palau, Papua New Guinea, as an assessment tool has existed since the early the Philippines, Samoa, Solomon Islands, Thailand, 1990s, and the past decade has seen a growth in Timor-Leste, Tonga, Vanuatu, and Vietnam. its application. SEA has been institutionalized in the Region either as an application of EIA prin- The chapter builds on published literature on ciples for plans or programs (for example, in China, SEA within the East Asia and Pacific Region as Vietnam, and the Philippines) or as a more flexible well as on SEA publications within the World approach for integrating environmental consid- Bank. It focuses only on World Bank–supported erations into the planning process, such as in projects in the Region during the past decade. Indonesia and Malaysia (Dusik and Xie 2009).9 Information presented is based on extensive literature review, interviews, and correspondence The World Bank has actively supported the SEA with technical staff in the EAP Region and at process in the Region and piloted a few SEAs, World Bank Headquarters in Washington, D.C. such as the hydropower SEA in Lao PDR, the REA A questionnaire was developed that formed the in sanitation and sewerage in metro Manila, and basis of the interviews and correspondence with the SEA of China’s Western Region Development technical staff in the Region (see Annex 3.1). Strategy. SEA in the Region includes both impact- centered SEA and institution-centered or policy This review includes sectoral environmental SEA. The Bank’s 2001 Environment Strategy for assessments, regional environmental assess- the EAP Region highlights the need for SEAs to be ments (REAs), cumulative impact assessments undertaken in areas where projects and programs (CIAs), strategic environmental and social assess- may have cumulative and sector-wide environ- ments (SESAs),7 and country environmental mental and social implications (World Bank 2006). analyses (CEAs).8 Here, all these types of environ- mental assessments are considered SEAs to the Since the late 1990s, the Bank has emphasized extent that they enable scrutiny of environmental the need for mainstreaming environment into and social concerns at broad decision-making sector reform and policy design. Notably, in levels and the integration of these concerns into 2004 the World Bank updated its Operational decision making. Policy for Development Policy Lending (OP 8.60), 7 SESA explicitly refers to social issues along with environmental ones. As 9 In China, the EIA Law of 2003 regulates the environmental impact environment comprises the natural and social environment of human assessment of projects and plans, referring to the latter as “Plan activities, SESA is synonymous with SEA. Environmental Impact Assessment.� In Vietnam, the 1993 Law on 8 Country environmental analysis is identified as one of the key country- Environment Protection, its implementing Government Decree 175/CP, level diagnostic tools to evaluate systematically the environmental and Circular No. 490/TTBKHCNMT mandated that EIA must be carried priorities of development, the environmental implications of key out not only at project level but also for master plans for development policies, and countries’ capacity to address their priorities. CEAs have of regions, sectors, provinces, cities, and industrial zones. In Indonesia, been referred to as a type of SEA or “SEA tool,� and although not all in 2009 Law No 32 on Environmental Management and Protection CEAs can be considered as SEA, those included in this paper have a requires SEA for spatial plans. A bill intending to make SEA a legal more strategic focus (Dalal-Clayton and Sadler 2005; Posas 2011). requirement is pending in the Philippines. World Bank SEA Experience in East Asia and the Pacific: A Tool for Environmental Safeguarding 23 emphasizing “upstream analysis of social and envi- making. Though the specifics and boundaries ronmental conditions and risks� and mentioning of SEA are debatable, it is increasingly recog- SEA, CEA, and other analyses (Dusik and Xie nized as a continuum of approaches rather than 2009). In 2005, a multiyear SEA program entitled a single, fixed approach (Ahmed and Sánchez- “Developing Practice and Capacity of Strategic Triana 2008; OECD-DAC 2006). This is reflected Environmental Analysis in East Asia and Pacific in the drivers for SEAs undertaken in EAP. The Region� was launched. This project aimed to drivers can be grouped into four categories. The mainstream environmental concerns into sectoral, first two can be seen as requirements while the national, and regional development policies, other two are better thought of as objectives programs, and plans through Bank operation– driving SEA. related SEA applications, knowledge sharing, and capacity building (World Bank 2011a). More 1. Comply with national legal requirements recently, in 2011 the Operational Policy on (SEA of Tourism Development in the Guizhou Environmental Assessment (OP 4.01) was revised Province, China; SEA of the National Forestry to include SEA and SESA. For the first time SEA Master Plan, Vietnam). and SESA are listed as possible instruments to be used to satisfy the Bank’s environmental In China, Indonesia, and Vietnam, SEA and assessment requirement. SEA-type studies are conducted at all levels of decision making to comply with the legal Additionally, other studies have reviewed SEA framework. In China plan EIAs, in Indonesia EIA practice in East Asia, including legislative require- for spatial plans, and in Vietnam EIA of master ments and case studies (e.g., Dusik, and Xie plans for development of regions, sectors, prov- 2009; World Bank 2006). China and Vietnam, in inces, cities, and industrial zones are required. particular, have been the focus of a number of publications, workshops, and international confer- 2. Fulfill donor requirements10 (REA Mekong Delta ences (e.g., Carew-Reid and Dusik 2011; Spengler Water Management for Rural Development 2009). In fact, the 30th Annual Conference of the Project, Vietnam; SEA Trung Son Hydropower International Association for Impact Assessment Project, Vietnam; CIA and SIA Nam Theun 2 in 2010 celebrated a China Day, focusing on the (NT2), Lao PDR). state of SEA and EIA in China. Several SEAs have been driven by donor Annex 3.2 lists SEAs in the Region supported by requirements and pilot programs. As a number the World Bank in the last decade. Six of these of safeguard policies were triggered by the have been chosen as case studies, Mekong Delta Water Management for Rural two are described within the chapter and four Development Project, an REA was prepared in Annex 3.3. The case studies presented were to comply with the safeguard policies and to chosen to illustrate drivers of SEAs, different ensure that the project does not have adverse approaches to conducting SEA, the application of impacts.11 Similarly, a cumulative impact SEA across different sectors, and lessons learned assessment and a wider hydropower stra- based on SEA recommendations. tegic impact assessment (SIA) were conducted for the Nam Theun 2 hydroelectric project to address the nature and scale of the impacts, Findings 10 Within the World Bank, SEA has been used as a tool for environ- mental safeguarding, as part of analytical and advisory activities, Drivers of SEA for capacity building and training, and in the context of OP 8.60 relating to development policy lending (Ahmed et al. 2005). 11 The project triggered the following safeguard policies: environ- SEA is a set of tools meant to integrate environ- mental assessment (OP 4.01), pest management (OP 4.09), indig- enous peoples (OP 4.10), involuntary resettlement (OP4.12), and mental considerations into upstream decision international waterways (OP 7.50). 24 Str ategic Environmental Assessment in the World Bank which attracted international scrutiny. The SEA Timing of SEA of the Trung Son Hydropower project aims to address a number of issues required for The timing of an SEA can be critical for influ- World Bank financing appraisal, including the encing planning and policy making. Often policy preparation of an EIA and an environmental and macro issues are discussed and defined management plan compliant with World Bank by client countries in the Region prior to Bank safeguard requirements. involvement. In many cases, the Bank is invited to participate at the project stage after stra- Inform existing or draft policies and plans 3. tegic decisions have been taken. At that stage (SEA of Tourism Development in the Guizhou it becomes too late to influence plans, let alone Province, China; SEA of the National Forestry policies. When an SEA is conducted early in Master Plan, Vietnam). the planning process, it has a greater chance of influencing decision making. SEA should be The SEA of the tourism sector in Guizhou adapted to the planning and the situation, not Province was undertaken to inform the Plan vice versa. For example, with the Nam Theun 2 EIA that the provincial government needed CIA and SIA studies, initially concerns were raised to undertake for its proposed tourism devel- about the timing of the studies. Many stake- opment strategy. In the forestry sector SEA holders felt there was limited ability to influence of Vietnam, a rapid SEA was conducted to project design since the two studies came late inform the preparation of the forestry master in the planning and decision process, after many plan (2010–2020). A rapid assessment of three decisions had already been taken (Morgan et al. Provincial Forest Protection and Development 2009). In this case, as the project evolved the Plans was undertaken, and the SEA provides studies did prove valuable, and the environmental guidance for developing a National Forestry measures undertaken are cited as an exemplary Master Plan and wider government decision case of environmental protection (see Annex 3.3 making in the forestry sector. for more details). Moreover, they played a role in influencing a range of environmental prac- Inform about cumulative impacts of programs 4. tices in Lao PDR. With the strategic assessment or subprojects (REA for Manila Third Sewerage for spatial planning in Papua province, because Project; REA for Mindanao Rural Development it was conducted to inform spatial planning Program-I). and different development scenarios prior to plan development, the recommendations In such cases, the purpose of the SEA is to plan proved beneficial. future subprojects better and to minimize and mitigate impacts by incorporating the findings Stakeholder Participation into the project-specific EIAs. This was seen in the case of the REA for Manila Third Sewerage Undertaking meaningful public consultation at Project, where lessons learned informed future an early stage of decision making is identified subprojects and the Global Environment Facility as one of the key requirements of SEA (Shi 2011; (GEF) Manila Third Sewerage Project. The REA Ahmed et al. 2005). One of the challenges of SEA for Mindanao Rural Development Program-I is to ensure that public participation is meaningful formulated environmental policies to enhance the and not just a case of providing detailed, positive impacts of Mindanao Rural Development rigorous, and comprehensive information. Program-2 and identified a negative list of The participation process must provide an subprojects and activities in order to safeguard opportunity for stakeholders to voice their needs the environment from any potential negative and influence decisions accordingly (World Bank impacts. In both cases the REAs proved influential 2012). A comprehensive public consultation in the selection of projects down the pipeline. program took place for the Manila Third World Bank SEA Experience in East Asia and the Pacific: A Tool for Environmental Safeguarding 25 Sewerage Project (MTSP) REA (see Box 3.1). Two the Forestry Master Plan in Vietnam indicates rounds of consultations along with site visits were that it is difficult to conduct consultations on undertaken. The consultations also validated broad agenda issues. Generally, the process and updated the results of the environmental of consultation, especially involving local assessment. The process was highly participatory, stakeholders, is weak in all countries. Li et al. allowing participants to voice their opinions and (2012) point that it is not necessary to develop concerns and feed into the SEA process. a complex public consultation process; what is important is to involve key stakeholders who The general observation from the Region is that play critical roles in the decision processes. often the public or local communities are not This usually includes national nongovernmental interested in the SEA consultation process, as organizations, government agencies, academia, impacts are not tangible and may not directly and other interested stakeholders. affect them. It has often proved difficult to get grassroots engagement in Bank-supported SEAs, Ownership particularly where the linkage between policy issues and impacts is unclear. This was evidenced Ownership matters and importance are reflected in the NT2 case, where local groups potentially in the SEA’s outcomes. A majority of the SEAs affected by decisions yet to be taken in some were World Bank–driven, thus clients were years were loosely engaged in the strategic not highly invested in the process. This influ- studies. Similarly, experience with the SEA for ences implementation of the recommendations. Box 3.1 REA for Manila Third Sewerage Project, Philippines (2005) The regional environmental assessment was conducted to to get familiar with the sociocultural environment. First- assess compliance of proposed World Bank investments in level consultations with community representatives Manila Third Sewerage Project. As the proposed project included a scoping workshop and focal groups, while the could potentially have significant environmental benefits second round included 12 public consultations with the and impacts at the regional level, a regional assessment concerned communities. was needed. It was felt that a project-specific EIA would The consultations greatly increased the community not adequately address the cumulative and interactive knowledge regarding sanitation, sewerage treatment, impacts of the project components. Project docu- environmental impacts, and project benefits. The consul- ments note that the REA was a complementary strategic tations also validated and updated the results of the document to the project. environmental assessment. The REA demonstrated the The REA focused on environmental issues such as noise, benefits of regional/sectoral studies bringing to light air and water pollution, flora and fauna, health benefits, the cumulative impacts of projects. The government has and water quality. It also looked at socioeconomic issues appreciated the value of such regional studies and has and at water, sewerage, and septage management facil- beefed up capacity of the Environment Department in ities. No project scenario was considered while assessing order to support such studies and follow up on imple- cumulative impacts. The REA concluded that the MTSP mentation. Specialized environmental engineers have would have net benefits on the region as compared with been recruited. Moreover, lessons learned from this REA no project scenario. have informed another wastewater management project in Manila. The REA helped the government “sharpen its A comprehensive public consultation program was lens,� leading to a more focused approach. In addition, undertaken, including two rounds of consultation. This the REA facilitated and informed the GEF Manila Third included scoping workshops and focused group discus- Sewerage Project. sions. Prior to the consultations, site visits to the affected communities and their representatives were undertaken Source: Based on Manila Water Company, Inc. 2005. 26 Str ategic Environmental Assessment in the World Bank Ownership needs to be addressed in the rela- environmental impacts of planned transport tionship between the donor/multilateral agency projects. This increased the awareness of senior and the partner countries, on the one hand, and managers at the Hubei Provincial Communication internally within governments and key constitu- Department (HPCD) about macro-level envi- encies of partner countries on the other hand ronmental implications of the proposed devel- (World Bank et al. 2011). The NT2 studies illus- opment of road transport. As per the review trate this point. Initial support for these studies conducted on the Hubei pilot SEA, the HPCD was not uniform, as the government, the Nam management now pays more attention to envi- Theun 2 Power Company, and the NT2 project’s ronmental issues, as evidenced in detailed inves- Panel of Experts expressed skepticism at various tigations carried out during the design stage of times regarding the relevance and utility of the each road project (World Bank et al. 2011). CIA/SIA process, which they saw primarily as a donor-driven requirement (Morgan et al. 2009). In all projects, the evidence suggests that SEAs The Manila sewage project SEA made the client raised awareness about environmental issues realize the value of such studies. There is a greater within government institutions, although the involvement and willingness to undertake audits extent to which SEA facilitates capacity building and report outcomes. The client is more receptive and encourages interagency cooperation varies toward the GEF component of the project. across projects. In the Philippines, for example, the government has appreciated the value of Learning Process regional studies. It has beefed up capacity of the Environment Department in order to support such SEAs can facilitate policy and social learning. studies and to follow up on implementation, in Literature on this subject suggests that an insti- part due to experiences from the Manila waste- tution-centered approach to SEA places special water REA. While interagency cooperation still emphasis on improved governance, social has a long way to go, it is moving in a positive accountability, and social learning, bringing direction. In China, there is a low capacity in attention to environmental issues and improving sector agencies, which manifests itself in the lack the design of public policies (OECD-DAC 2006). of effective consultation and stakeholder partici- This could be illustrated with the Hubei road pation. This is compounded by an absence of insti- transport planning SEA, in which people agreed tutional coordination (Quintero and Sun 2010). that sharing data from baseline analyses was the most useful aspect of the SEA and that learning Often it is the recommendations of the SEA that was facilitated through this sharing (World Bank give impetus to capacity building, as seen with et al. 2011). According to Dusik and Xie (2009), the recommendations of the SEA on tourism the consultations for the Manila wastewater development in Guizhou Province (see Box 3.2). REA greatly increased community knowledge As per the recommendations of the Hubei SEA, regarding sanitation, sewerage treatment, envi- institutional strengthening was undertaken as ronmental impacts, and project benefits. part of the YiBa highway project. Environmental Awareness and Capacity The capacity to conduct SEA is weak within Building within Institutions sector agencies. But in countries where SEA and SEA-type activities are part of the regulatory SEA can influence environmental management framework, SEA has raised awareness about systems and building capacity within govern- environmental issues and the importance of ments. Increased awareness can have a positive including environmental considerations in decision impact on giving priority to environmental issues. making, especially at the national level. The legal For example, the Hubei pilot SEA provided requirement has led to the training of consultants an overall holistic picture of the possible and government staff. World Bank SEA Experience in East Asia and the Pacific: A Tool for Environmental Safeguarding 27 Box 3.2 SEA of Tourism Development in Guizhou Province, China (2007) This SEA arose from World Bank project entitled �� Poorinterdepartmental cooperation and institutional Guizhou Natural and Cultural Heritage Protection and arrangements for the protection of nature reserves and Development Project for the tourism sector of Guizhou scenic areas Province, China. The objective of the SEA was to enhance due to infrastructure construction �� Deforestation the sustainability of Guizhou’s tourism sector through without proper planning assessing environmental and socioeconomic impacts of tourism development and improving the design and �� Waterpollution and the absence of wastewater implementation of tourism development policies, plans, treatment facilities and programs. This was the first tourism sector SEA in �� Wildlife protection problems China. The SEA was meant to inform the Plan EIA that the provincial government needed to undertake for the �� Culturalconflict in the effect of tourism on tradi- proposed tourism development strategy. tional culture Stakeholder consultations included interviews with �� Equitable distribution of project benefits, making sure government authorities, mostly to gather data; consultations that local communities benefit economically from with various contracted or independent consultants on key tourism development environment and social issues; a workshop with government �� Privatesector regulation to avoid illegal and uncon- authorities, including provincial and municipal/prefecture trolled construction, and the management of authorities; and a workshop with a selection of local tourism assets. community representatives from proposed project villages. Accordingly, the recommendations of the SEA touch Generally, government officials were supportive of on strengthening interdepartmental coordination and tourism development in Guizhou, and community repre- capacity building, especially technical expertise in sentatives were also satisfied with the economic benefits heritage protection and planning, including carrying that tourism development had brought to their villages. capacity assessments for sensitive and popular sites, Some key issues that arose from the consultations include: equitable distribution of benefits, and regulating private sector investments. Source: ERM 2007. Shifting Priorities EAP view SEA. Climate change is one of the biggest factors affecting strategic planning. In Except when legally required, the impetus to the Philippines, for example, climate change is conduct SEA is low. SEA is not given priority, and becoming a priority, with government Action the motivation to conduct SEA is weak within Plans being evaluated through this lens. Earlier, most countries and sectors. Typically SEA is seen instruments such as modeling scenarios were as a bureaucratic and unnecessary process with typically used, but now the scope is being limited added value to decision making, possibly broadened to include other tools like EIA. SEA is delaying projects. Examples have been cited increasingly viewed as a tool to evaluate climate- where the Bank team has proposed an SEA or related risks and vulnerabilities and to develop REA but clients refuse to arrange it as it is seen as appropriate programmatic responses (Herron an exercise in addition to the EIA. et al. 2011). In Indonesia and Vietnam, priorities are shifting—with climate change mitigation In the recent past, a shift in government prior- and reducing emissions from deforestation and ities due to the changing global and economic forest degradation (REDD) gathering momentum climate is influencing how governments in and resources. The Indonesia CEA identified 28 Str ategic Environmental Assessment in the World Bank climate change as a new national priority that Box 3.3 Environmental Assessment is relevant to Indonesia’s development. REDD for Wuhan’s Urban projects with the Forest Carbon Partnership Transport Development Strategy Facility (FCPF) are being initiated with Terms of Reference for SESAs being drafted. The strategy was launched as part of the Wuhan Urban Transport Project and updated in 2006 during the proj- Applying Recommendations from SEA ect’s implementation. The environmental assessment comprehensively assessed the rationale of the strategy The results of SEAs are not free of controversy. from an environmental perspective and confirmed the SEA ought to influence positive development importance of public transport as one of the core prior- results and help enhance the effectiveness of ities for Wuhan’s urban transport development, based on development. Development involves complex which the Wuhan Second Urban Transport Project was processes, and it is not easy to isolate those scoped. The assessment helped to identify environmen- tally sensitive sites and terrains and confirmed that the outcomes that are solely due to the application larger transport plan was consistent with sound environ- of SEA (IIED 2009). For example, for the forestry mental principles. sector in Vietnam there is a master national plan to 2020 as well as five-year and one-year Source: World Bank 2009, 2010. plans. Each province also carries out planning, and there are specific plans for subsectors (such as mangroves or plantations). But the extent The importance placed on environmental issues to which these plans are influenced by the by governments while making long-term policy National Forestry Master Plan 2010–2020 SEA is decisions plays a role in determining if the recom- uncertain. However, the FCPF project presents mendations are carried forward. This relates to the an opportunity to revisit the environmental and earlier point of government priorities. For example, social issues and make sure the best recommen- in Vietnam importance is placed on forestry sector dations are being taken forward. The Hubei SEA and REDD. The REA of the Mekong Delta Master indirectly contributed to a new circular, issued Plan concluded that the existing development of by the HPCD management, that encourages land for agriculture and aquaculture had adverse the enforcement of environmental protection impacts on soil and water quality, reducing agri- requirements during expressway construction cultural yields. As a result of the study, forest (World Bank et al. 2011). In Mongolia, after clearance is now more strictly controlled, and the the REA a number of publications—including application of prohibited pesticides has been Important Bird Areas, Fencing Options for Liner reduced. Crop diversification has been adopted Infrastructure, Ground Water Management, and recommended as an important measure to and Ground Water Isotope Study—have been avoid soil degradation. published. Components of the Second Wuhan Urban Transport Project have been designed based on the environmental assessment Looking at the Future of SEA in of the Wuhan Urban Transport Master Plan the Region (see Box 3.3). Based on the results of the case studies and Generally, complex monitoring and evaluation literature reviewed, Table 3.1 is an attempt to frameworks along with poor follow-up by the summarize indicators of conditions that can Bank after project completion appear to play a steer SEA in a positive direction to influence large role in the information gap. SEAs where decision making. the output is focused, with clear-cut recom- mendations, have a greater chance of influ- The view of most regional staff interviewed in encing decisions. the Region is that SEA can be a useful tool. SEA World Bank SEA Experience in East Asia and the Pacific: A Tool for Environmental Safeguarding 29 Table 3.1 Status of SEA Indicators in the Region SEA Political Legal procedure/ Public Country will mandate Institutions guidelines involvement Remarks Cambodia x x x x NA Lack of staff in MOE for SEA. China √ √ √ √ – Plan EIAs are legally required. Public involvement is legally mandated in EIA law. Indonesia √ √ √ √ – SEA required for strategic plans. Lao PDR x x x x NA Not applicable. Mongolia √ √ x x NA Not applicable. Philippines √ x √ x – SEA bill pending. SEA expertise existing in adminis- tration and academia. Thailand √ x x – NA Not applicable. Vietnam √ √ √ √ – EIA regulation is SEA inclusive. √ Positive, x Negative, – Neutral, NA Not Available The government’s introduction and application of SEA is used as evidence to confirm political will. Legislation on SEA is the most appropriate indicator of a legal mandate. Establishment of a Ministry of Environment and Planning or other authorities, including staffing to be responsible for SEA, is used for institutions. Existence and quality of official documents to guide SEA implementation are used to describe the statutes of SEA procedure, guideline, and methodology. Public involvement is evaluated by both regulations and practical implementation. Source: Adapted from World Bank 2006. can—and does in the best of cases—add value to A more upstream and proactive approach toward decision-making processes in the Region. It can SEA in the Region would help increase the bring together stakeholders at a strategic level. number of SEAs undertaken and their usefulness However, undertaking SEA can be a major chal- to the decision-making process. In particular, lenge. SEA is still in its infancy in several countries there should be a focus on sectors and clients with regard to government agencies awareness with which the Bank has continued engagement and understanding of its benefits and added through multiple projects over a long period of value. In reality, several countries are struggling time. This would allow a system to be put in place with project-level EIAs. for follow-up or monitoring SEA that is necessary to better integrate SEA recommendations into Within the EAP Region of the World Bank, there actions that influence decision making. SEA can be reluctance to undertake SEA because should be promoted where the World Bank has often within the investment loan operations there leverage to follow up on the recommendations. is not enough time for such an assessment or Such opportunities present themselves where it is considered too late in the decision-making there is long-term engagement with the client process for an SEA to provide added value. and follow-up is possible either through the same Pressure to address project-specific safeguard lending operation or different ones. requirements and time act as a disincentive toward working on an SEA. The lending port- As timing of an SEA is critical, in particular in folio does not always lend itself well to working EAP, given its type of portfolio, there is a need on SEA within the context of a project prepa- to better articulate the added value of SEA and ration schedule. how to undertake such a study when engaging 30 Str ategic Environmental Assessment in the World Bank upstream in policy dialogue with counterparts in infrastructure would be promoted by this ministries/sectors such as transport, energy, or initiative. Technical assistance for strengthening water. Often the Bank is involved at the project environment and social assessment capacity level after decisions have been taken and it is too during the preparation and implementation of late to undertake an SEA. A more holistic and infrastructure projects will also be provided. integrated approach that aligns SEA as much as possible with the macroeconomic policy decision- A comparative study of lessons learned and good making process would be helpful to ensure that practices from infrastructure projects within the environmental and social considerations are prior- Region will be completed in the first part of FY13. itized in the planning process. This will provide lessons on how to enhance the integration of environmental and social dimen- To further develop SEA, technical assistance that sions upstream in the planning and design stage is responsive to contextual country conditions of infrastructure development as well as how should be provided to government agencies to more effectively integrate such dimensions where SEA can be proposed as an appropriate during implementation. The results would inform instrument. Some countries, such as Vietnam technical support to the SEA process in EAP. and the Philippines, are increasingly realizing the potential added value of SEA. Supporting the With climate change increasingly becoming a governments in conducting SEA using various priority, the SESA studies in progress provide analytical tools in a systematic manner could lead an opportunity to review and assess the effec- to better integration of environmental issues into tiveness of social and environmental assessment the planning process. as a tool for better planning of projects that will be developed for REDD projects. Several countries are carrying out SEA-type studies incorporating elements of SEA but not The EAP Region is one of the fastest-growing necessarily calling the studies SEA. These studies economic regions of the world. This rapid are mainly focused on regional effects and cumu- economic development coupled with an increase lative impacts in areas or sectors or between in demand for goods and services presents a sectors. It is important to recognize these activ- challenge to mainstreaming environment into ities and engage in dialogue as early as possible decision making. The World Bank SEA approach to effectively use such instruments. Furthermore, therefore must cater to the fluid and dynamic methodologies should be adapted to meet the planning cycles, highly compartmentalized client needs within the Region. It is necessary to administrative responsibilities, and increasing get more involved, tailoring methodologies and decentralization and devolution of decision linking SEA with client practices and country- making (Dusik 2008). specific needs. Many counterparts are at the regional or municipal level within the Region. Thus methodologies have to be calibrated according to the concerns of the regional entities, which may differ from those at the national level. Within the Region, there is a need to raise awareness and build technical capacity on SEA. This can partially be achieved through the ongoing capacity-building initiative for safe- guards under development in which SEA is part of the curriculum. Centers of excellence (learning centers) on environment and social sustainable World Bank SEA Experience in East Asia and the Pacific: A Tool for Environmental Safeguarding 31 References Ahmed, K., and E. Sánchez-Triana. 2008. “SEA and Policy Formulation.� In K. Ahmed and E. Sánchez-Triana, eds., Strategic Environmental Assessment for Policies: An Instrument for Good Governance. Washington, DC: World Bank. Ahmed, K., J. R. Mercier, and R. Verheem. 2005. Strategic Environmental Assessment Concept and Practice. Environment Strategy Note No. 14. Washington, DC: World Bank. Carew-Reid, J., and J. Dusik. 2011. Biodiversity and Development of the Hydropower Sector: Lessons from the Vietnamese Experience. Volume 2: SEA as a Tool to Integrate Biodiversity with Development Planning. Prepared for the Critical Ecosystem Partnership Fund by International Centre for Environmental Management. Hanoi, Vietnam. Dalal-Clayton, B., and B. Sadler. 2005. Strategic Environmental Assessment: A Sourcebook and Reference Guide to International Experience. London: Earthscan. Dusik, J. 2008. Summary Report of Workshop on Strategic Environmental Assessment in East Asia & Pacific Region. World Bank Institute and ADB-GMS Environment Operations Center. Dusik, J., and J. Xie. 2009. Strategic Environment Assessment in East and Southeast Asia: A Progress Review and Comparison of Country Systems and Cases. Sustainable Development—East Asia and Pacific Region Discussion Papers. Washington, DC: World Bank. ERM (Environmental Resources Management). 2007. Strategic Environmental Assessment Study: Tourism Development in the Province of Guizhou, China. Herron, H., C. MacPherson, and T. Leonardo. 2011. Incorporating Stakeholder Climate Change Priorities into SEA: Lessons Learned from Asia. Conference Proceedings. 31st Annual Meeting, International Association for Impact Assessment, Puebla, Mexico. Hirji, R., and R. Davis. 2009. Strategic Environmental Assessment: Improving Water Resources Governance and Decision Making, Case Studies. Environment Department Papers, Water Series Paper No 116. Washington, DC: World Bank. IIED (International Institute for Environment and Development). 2009. Profiles of Tools and Tactics for Environmental Mainstreaming: No. 2 Strategic Environment Assessment. London: IIED, Department for International Development, and Irish Aid. Li, W., Y. Liu, and Z. Yang. 2012. “Preliminary Strategic Environmental Assessment of the Great Western Development Strategy: Safeguarding Ecological Security for a New Western China.� Environmental Management 49: 483–501. Manila Water Company, Inc. 2005. Regional Environmental Assessment for Manila Third Sewerage Project. Morgan, G., F. Loayza, and H. Kobayashi. 2009. Lao PDR Nam Theun 2 (NT2) Hydro-electric Project: SEA Case Study. Environment Notes No 2. Washington, DC: World Bank. NORPLAN A/S. 2004. Lao PDR Hydropower – Strategic Impact Assessment. NORPLAN and EcoLao. 2004. Cumulative Impact Analysis and Nam Theun 2 Contributions. OECD-DAC (Organisation for Economic Co-operation and Development–Development Assistance Committee). 2006. Applying Strategic Environmental Assessment: Good Practice Guidance for Development Cooperation. Paris. Posas, P. J. 2011. “Exploring Climate Change Criteria for Strategic Environmental Assessments.� Progress in Planning 75(3): 109–54. Quintero, J. D., and C. Sun. 2010. Strategic Environmental Assessment: Perspectives from the World Bank in China. Summary Report – China Day: The State of SEA and EIA in China. 30th Annual Meeting, International Association for Impact Assessment. SEA Centre, Nankai University, and Econ Pöyry as. 2008. Strategic Environmental Assessment (SEA) for Hubei Road Network Plan (2002–2020). Shi, X. 2011. What Does Good Public Consultation Mean for SEA: Experience from China. Conference Proceedings. 31st Annual Meeting, International Association for Impact Assessment, Puebla, Mexico. Spengler, L. 2009. Public Participation in Strategic Environmental Assessment in China. CHINA-EPI-SEA Paper No. 29_EN. Wuppertal, Germany: Wuppertal Institute. World Bank. 2006. Environmental Impact Assessment Regulations and Strategic Environmental Assessment Requirements: Practices and Lessons Learned in East and Southeast Asia. Environment and Social Development Department, East Asia and Pacific Region. ———. 2009. Integrated Safeguards Datasheet: Appraisal Stage for Wuhan Second Urban Transport Project. Washington, DC. ———. 2010. Project Appraisal Document on a Proposed Loan in the Amount of $100 Million to the People’s Republic of China for a China Wuhan Second Urban Transport Project. Washington, DC. ———. 2011a. Strategic Environment Assessment: East Asia and Pacific Region. Washington, DC. ———. 2011b. Using Strategic Environmental Assessment to Inform the Forestry Master Plan 2010–2020 of Vietnam. Washington, DC. ———. 2012. Key Elements of SEA. http://go.worldbank.org/4AIFB3W680. World Bank, MONRE, MOI, and EVN. 2007. Pilot Strategic Environmental Assessment in the Hydropower Sub-sector, Vietnam. Final Report: Biodiversity Impacts of the Hydropower Components of the 6th Power Development Plan. Hanoi, Vietnam. World Bank, University of Gothenburg, Swedish University of Agricultural Sciences, and Netherlands Commission for Environmental Assessment. 2011. Strategic Environmental Assessment in Policy and Sector Reform: Conceptual Model and Operational Guidance. Washington, DC: World Bank. 32 Str ategic Environmental Assessment in the World Bank Annex 3.1: Questionnaire A questionnaire was developed to guide interviews and to email technical experts in order to review the SEA practice in the Region. The questions were tailored to each country. SN. Question Response 1 Please list the SEAs undertaken in your country that have involved the World Bank in the past decade 2 Of the SEAs undertaken does any one in particular stand out and why? 3 Is there a legal requirement for under- taking SEA in your country?  4 If yes, when did it come into force and how has it influenced the SEA process? 5 How has use of SEA in Bank’s activities evolved during the last decade? 6 What have been the main drivers for the SEAs undertaken? 7 What factors contributed to the success or failure of the SEAs? 8 What were the outcomes of using SEA? Did they inform the planning process? 9 Were recommendations from SEA applied? 10 Have decision-making and environmental management systems been influenced by SEAs? 11 Has SEA been a vehicle for capacity building? 12 Have the SEAs proved valuable to client countries? 13 Has SEA created a space for stakeholders to participate and voice their needs? 14 How was stakeholder participation undertaken in the SEAs? Did it inform the process? 15 Recommendations for moving forward on the regional SEA agenda 16 Any other comments or observations regarding SEAs? World Bank SEA Experience in East Asia and the Pacific: A Tool for Environmental Safeguarding 33 Annex 3.2: SEAs in East Asia and Pacific Region SNo Name of project Country Year* Sector 1. Environmental Assessment for Wuhan’s Urban Transport Development China 2005 Transport Strategy 2. SEA of Tourism Development in the Guizhou Province China 2007 Tourism 3. SEA for Hubei Road Network Plan (2002–2020) China 2008 Transport 4. SEA for Sino-Singapore Tianjian Eco-City China 2008 Cross-sectoral 5. SEA Scoping Study on China’s Railway Sector China 2006 Railway 6. Cumulative Impact Assessment for Nam Theun 2 Hydroelectric Project Lao PDR 2005 Hydropower 7. Strategic Impact Assessment for Hydropower Lao PDR 2004 Hydropower 8. Strategic Assessment for Spatial Planning in Papua Province Indonesia 2008 Cross-sectoral 9. SESA FCPF REDD Readiness  Indonesia In progress Forestry 10. Investing in a More Sustainable Indonesia: Country Environmental Indonesia 2009 Country Analysis 11. Southern Gobi Regional Environmental Assessment Mongolia 2010 Mining 12. REA for Manila Third Sewerage Project Philippines 2005 Sanitation 13. REA for Mindanao Rural Development Program-I (Adaptable Program Philippines 2006 Cross-sectoral Loan 2) 14. EA Second Women’s Health and Safe Motherhood Project Philippines 2010 Health 15. Country Environmental Analysis Philippines 2009 Country 16. Pilot Strategic Environmental Assessment in the Hydropower Sub-sector: Vietnam 2007 Hydropower Risks to Biodiversity from the 6th Power Development Plan 17. SEA of the Hydropower Master Plan in the Context of the Power Vietnam 2009 Hydropower Development Plan VI 18. SEA to Inform the National Forestry Master Plan 2010–2020 Vietnam 2011 Forestry 19. REA Mekong Delta Water Management for Rural Development Project Vietnam 2011 Water management 20. SEA Trung Son Hydropower Project Vietnam In progress Hydropower 21. SESA for REDD+ Vietnam In progress Forestry *Year the report was prepared. Source: World Bank. 34 Str ategic Environmental Assessment in the World Bank Annex 3.3: Case Studies Strategic Environmental Assessment for Hubei Road Network Plan 2002–2020, China (2008) The Hubei Provincial Communication Department data collection methods and monitoring of (HPCD) requested the World Bank’s support to environmental performance of plans or projects, conduct a strategic environmental assessment limited coordination between agencies, and a (SEA) for the Hubei Road Network Plan (HRNP) lack of awareness on SEA within the HPCD. for 2002–2020. As the plan was already written and approved when the SEA was undertaken, the As a result, the SEA proposed several actions assessment focuses on social and environmental to strengthen the environmental management priorities associated with implementing the plan capacity in the HPCD and its cooperation with other and on strengthening institutional capacities in sector authorities as well as other stakeholders in the HPCD for managing these priorities. road plan development. Institutional strengthening proposals, and especially those that challenged Impacts in relation to the road network were current internal arrangements within the responsible assessed for air, water, energy consumption, authority, were the most sensitive topics that arose climate factors, ecological issues, socioeconomic during the SEA. issues, and road safety. The relatively open sharing of baseline data was considered unusual, Outcomes: The SEA provided an overall, holistic and it led to technical and social learning on the picture of the possible environmental impacts of part of participating institutional stakeholders. planned transport projects. It positively influ- enced wider decision making on road planning Stakeholders including Hubei government in Hubei province. According to the report on sector bodies, transport service users’ SEAs in sectoral and policy reform (World Bank et organizations, transport service providers, al. 2011), the SEA increased awareness of senior and nongovernmental organizations (NGOs) managers at the Hubei Provincial Communication were consulted on the significant impacts of Department about macro-level environmental the HRNP and to obtain baseline information, implications of the proposed development of identify impacts, and identify priorities and road transport. The HPCD management is paying scenario development. However, the SEA points attention to environmental issues, as evidenced out that the team was not able to carry out a in detailed investigations carried out during the broad public participation process or sufficiently design stage of each road project. The SEA also engage stakeholders in consultations in order indirectly contributed to a new circular, issued to obtain detailed views on the various issues in by the HPCD management, that encourages the analysis. It further adds that the SEA did not the enforcement of environmental protection undertake stakeholder analysis in accordance requirements during expressway construction. with best international practice. All those interviewed during the evaluation of the SEA agreed that sharing data from baseline The SEA assessed the environmental analyses was the most useful aspect of the SEA management capacity for road projects of the pilot and that learning was facilitated through this HPCD and interinstitutional linkages between sharing. The evaluation indicated that policy SEA the HPCD and other relevant organizations at approaches ran up against the legal processes the provincial level. A number of gaps were prescribed for the plan environmental impact found, including unsystematic environmental assessment (EIA) in Chinese law. The evaluators World Bank SEA Experience in East Asia and the Pacific: A Tool for Environmental Safeguarding 35 describe these processes as being very rigid and ■■ Oneshould be very careful about how to with corresponding institutional arrangements present methodologies/results. that do not necessarily support the flexibility and inclusiveness sought by policy SEA approaches ■■ How to consult with the really affected stake- (World Bank et al. 2011). holders and NGOs is a considerable challenge in countries with limited traditions for formal Some of the lessons learned from the SEA consultation procedures. process include: ■■ Given the limited experience with SEAs at the ■■ Limited awareness of and engagement in envi- local level, communication, coordination, and ronmental issues are a challenge that takes time consultation are the areas where inputs and to overcome. support from international experts are critical. ■■ SEA is far from being integrated into decision- ■■ Access to good data, especially time-series making processes. data, is a challenge. ■■ Stakeholders are interested in impacts, not in ■■ SEA should put the emphasis on starting institutions. a process rather than on the output of the analysis. ■■ Lack of transparency is a general challenge for an effective use of the SEA. Source: SEA Centre et al. 2008; World Bank et al. 2011. Cumulative Impact Assessment and Strategic Impact Assessment for Nam Theun 2 Hydroelectric Project, Lao PDR (2005) Although the cumulative impact assessment faced due to hydropower development in Lao (CIA) and the strategic impact assessment (SIA) PDR. It assessed the sector-wide implications, were not explicitly called strategic environmental including environmental and social impacts, assessments, their approaches and the issues from 22 planned hydropower developments addressed exemplify the use of environmental over a 20-year period to 2022. The report assessment at the regional and watershed recommended general mitigation approaches levels in response to the complex analytical and broad management programs as well as and participatory requirements of large-scale approaches to planning, training, monitoring, infrastructure projects. The level of international and capacity building suited to the Lao context. scrutiny of the Nam Theun 2 (NT2) project acted as a powerful driver for the government of Lao The CIA assessed the impacts of the NT2 project PDR, the World Bank, and other lenders to along with the potential impacts of existing, undertake the environmental assessments. planned, and proposed developments in the NT2 project area and in the Greater Mekong subregion. The Lao Hydropower Sector SIA was prepared The study summarized these potential cumulative to identify, at the sector level, strategic impacts at 5-year and 20-year horizons over five opportunities to avoid impacts and improve regions in the vicinity of the NT2 project. environmental and social management. It was meant to consolidate, update, and expand The SIA engaged government, stakeholders, previous work related to hydropower and the and donors in discussions on institutional and environment and to clarify the broader issues capacity needs for long-term sector growth, 36 Str ategic Environmental Assessment in the World Bank and the CIA engaged stakeholders in discussions the government’s ability to discuss and receive on regional impacts and development issues at feedback on environmental and social policies for different spatial and temporal scales. The CIA was the hydropower sector. The studies contributed primarily a desk study by a team of international to the adoption of the “National Policy on experts with diverse social and environmental Environmental and Social Sustainability for the specialist skills, although an initial workshop was Hydropower Sector.� It also led to improved held with government ministry staff and NGOs. resettlement and consultation practices and the creation of the Watershed Management and Both assessments were triggered by and were Protection Authority for NT2, the mandate of part of a project-level EIA. As such, they were which is conservation of the project’s designated not necessarily customized to the decision- protected area and building capacity at the local making process for the NT2 project, and although level. Other benefits included an understanding the assessments were available they were not of riparian risks of the international river system of influential in this process. the Mekong and compliance with World Bank and Asian Development Bank safeguard policies. Outcomes : The participatory approach of the two strategic studies was a key factor in creating an open dialogue among relevant stakeholders. Sources: NORPLAN and EcoLao 2004; NORPLAN A/S 2004; Hirji and The advisory nature of the assessments facilitated Davis 2009; Morgan et al. 2009. Using Strategic Environmental Assessment to Inform the Forestry Master Plan 2010–2020 of Vietnam (2011) In conjunction with the Investment Reform logic of the assessment was that provincial plans Development Policy Loan, the government of form the basis of the master plan and, therefore, Vietnam agreed to incorporate a strategic envi- they may provide a good illustration about the ronmental assessment in the development of key social and environmental implications of master plans for two regions and two key sectors. the planned forest management practices that One of the key sectors is forestry. The Ministry may be included in the national forestry master of Agriculture and Rural Development (MARD), plan. The SEA notes that since none of these as the implementing agency, is responsible for provincial plans requires a formal SEA under incorporating the SEA into the development of a the legal framework, this SEA should be treated master plan to implement the National Forestry as a donor-supported pilot SEA project that Development Strategy. does not fully operate in the Vietnamese SEA legal framework. A rapid SEA that would inform the devel- opment of the forestry master plan (2010–2020) The following activities were undertaken as part was conducted. The SEA undertook a rapid of the SEA: assessment of three Provincial Forest Protection and Development Plans (FPDPs) and provided 1. Determining the national environmental and guidance for the development of a National socioeconomic priority concerns that should be Forestry Master Plan and wider government considered in the elaboration and approval of decision making in the forestry sector. The three Provincial Forest Protection and Development FPDPs are considered representative of various Plans and the National Forestry Master Plan forest management practices in Vietnam. The 2010–2020 World Bank SEA Experience in East Asia and the Pacific: A Tool for Environmental Safeguarding 37 2. Outlining a national baseline for each identified experts, and stakeholders. The recommendations environmental and socioeconomic priority touched upon the following: 3. Assessing impacts of three provincial ■■ Forestry land-use planning and land allocation forestry plans ■■ Forest development 4. Reviewing and fine-tuning the initial assessment and preparing generic sugges- ■■ Forest protection tions for wider decision making related to the National Forest Master Plan utilization (including harvesting, ■■ Forest processing, and marketing of forest products) 5. Preparing an overview of the main economic implications of identified impacts and ■■ Interinstitutional cooperation proposed recommendations ■■ Financing solutions 6. Presenting outcomes of the SEA for endorsement by the Forestry Directorate, ■■ Integrationof environmental and social issues into Ministry of Agriculture and Rural Development, future forest protection and development plans and other national authorities and stakeholders. ■■ Otherrecommendations (science and tech- Fifty-two recommendations were formulated in nology, monitoring and evaluation, and human consultation with national and provincial officials, resource management). Source: World Bank 2011b. Pilot Strategic Environmental Assessment in the Hydropower Subsector: Risks to Biodiversity from the 6th Power Development Plan, Vietnam (2007) This was the first pilot SEA in Vietnam provided a methodology and set of tools for dedicated to assessing the biodiversity assessing biodiversity effects of hydropower risks (vulnerability and impacts) from any at the strategic level. A detailed methodology infrastructure development / hydropower. was developed to assess potential impacts of The report was not an input into a decision individual projects for basins, and a qualitative process about Bank support for a specific assessment of “cumulative zones of influence� investment project or for the hydropower sector was undertaken in basins where location data as a whole. Instead, it was intended to help were too sparse or of limited accuracy. Each strengthen government capacity to undertake project or cumulative zone of influence was clas- SEAs in the hydropower sector and to support sified into one of four categories, based on the and guide the ongoing dialogue between the biodiversity values of the affected area(s) and World Bank, Electricity of Vietnam, and the significance of impact/comparative risk to these government on a long-term capacity-building values. Category 1 projects combine very high program in the hydropower sector. biodiversity values and very high impacts on them; Categories 2 to 4, respectively, have high, The study focused on the potential effects of moderate, and low combinations of biodiversity planned hydropower on biodiversity. The SEA value and significance of impacts. 38 Str ategic Environmental Assessment in the World Bank The SEA also identified geographic areas and groups of projects in the 6th Power Development Plan (PDP) that require more-intensive appraisal and mitigation to ensure their sustainability and minimize their negative side effects on biodi- versity and the economy. The SEA underlined the potential cumulative risks and impacts on biodiversity of the 73 hydropower projects being constructed or proposed under the 6th PDP, both in terms of their aggregate footprint and their spatial concentration in nine major river basins. A key output of the study was the strong recommendation to keep intact (undammed) rivers within each basin and to focus future dams on rivers already dammed, rather than damming currently free flowing (wild) rivers. As the SEA was focused on biodiversity issues related to hydropower development, it did not assess impacts of other types of development or other areas of concern. Other developments would have impacts that interact with hydropower development, often in a cumulative fashion, so the assessment of hydropower in isolation may have overestimated some of its impacts. Conversely, the overall impacts of hydropower may have been underestimated by a focus solely on biodiversity impacts in the study. Source: World Bank et al. 2007. World Bank SEA Experience in East Asia and the Pacific: A Tool for Environmental Safeguarding 39 chapter 4 World Bank SEA Experience in Middle East North Africa and A Policy and Planning Tool Suiko Yoshijima12 Syrian Lebanon A.R. Malta Morocco Tunisia I.R. West Bank and Gaza Iraq of Iran Jordan Algeria Arab Kuwait Libya Rep. of Bahrain Egypt Qatar U.A.E. an Saudi m Arabia O Rep. of Djibouti Yemen 12 Suiko Yoshijima is Environmental Specialist, MNSEN. The author would like to acknowledge the guidance and assistance provided by Kulsum Ahmed (Sector Manager, ECSS3), as well as valuable inputs provided by Maged Hamed (Senior Environmental Specialist, MNSEN), Sherif Arif (Senior Consultant, MNSSD), and Nathalie Abu-Ata (Operation Analyst, MNCMI). The author is also grateful for the review and comments provided by Fernando Loayza (Senior Environmental Economist, ENV) and Francis Fragano (Senior Environmental Specialist, LCSDE). 40 Str ategic Environmental Assessment in the World Bank Introduction for moving the regional SEA agenda forward are made at the end of the chapter. The Middle East and North Africa (MENA) Region covers countries with diverse economic and social characteristics. The Region covers 12 recipients Evolution of SEA in Middle East of lending and knowledge support: Algeria, Djibouti, Egypt, Iran, Iraq, Jordan, Lebanon, and North Africa Morocco, Syria, Tunisia, West Bank and Gaza, and Yemen—with per capita incomes that range from In this section, the history of the application $1,070 (Yemen) to $8,880 (Lebanon) (World Bank of SEA in the MENA Region is introduced, 2011). MENA is a predominantly middle-income explaining the SEA drivers and how the drivers region with mainly IBRD countries but also two have changed. IDA countries (Yemen and Djibouti).13 Eight high- income developing countries (Bahrain, Kuwait, Initial Drivers Libya, Malta, Oman, Qatar, Saudi Arabia, and the United Arab Emirates) have access to the Region’s SEA evolved in the MENA Region in response fee-based advisory and technical assistance to demand from client countries to incorporate services (Reimbursable Technical Assistance). environmental considerations into strategic decision making. The countries’ strong interest in Because of its diversity, the level of capacity in addressing environmental issues strategically origi- terms of environmental governance varies. Since nated in the increased awareness nurtured by the the early 1990s, countries in MENA have made Mediterranean Environmental Technical Assistance significant progress in environmental planning and Program (METAP).14 METAP played a major role in environmental institutional and legal frameworks; evaluating national environmental strategies and however, enforcement still remains as an issue. helped establish environmental impact assessment units in various countries. The World Bank 2001 Strategic environmental assessment (SEA) has Environment Strategy noted that “the third phase historically been used as an instrument to main- [of METAP] would also build capacity to carry out stream environment into the development strategic impact assessments and to assess the agenda in the MENA Region. One of the recom- implications of international trade for the envi- mendations from the Regional Environmental ronment� (World Bank 2001). Strategy 2001 (World Bank Middle East and North Africa Region 2001) was to strengthen There was another internal Bank driver that analytical and advisory activities by identifying contributed to promoting SEA in the MENA priority cross-sectoral issues and to use SEAs Region. In the World Bank 1999 publication more systematically to influence planning and Fuel for Thought: An Environmental Strategy decision-making processes at an early stage. for the Energy Sector, energy-environment This chapter attempts to take stock of the reviews (EERs) were introduced as an important experiences in applying SEA in the MENA policy tool. EERs can be considered as a type of Region, assess the drivers of SEA application, SEA because they focus on identifying priority analyze how the drivers have shifted, and draw investments and policy reforms needed for lessons from good practices. Recommendations 14 Initiated jointly by the World Bank and the European Investment Bank 13 IBRD (the International Bank for Reconstruction and Development) (EIB) in 1990, METAP aimed to reduce environmental degradation in countries are middle-income and creditworthy poorer countries, the Mediterranean basin countries by providing technical assistance while IDA (the International Development Association) countries on strengthening the institutional and legal structure of environmental include the world’s 79 poorest countries, which have little or no management, formulating environmental policies, and developing a capacity to borrow on market terms. pipeline of environmental projects. World Bank SEA Experience in Middle East and North Africa: A Policy and Pl anning Tool 41 the incorporation of sustainability consider- environmental aspects into national policies ations into energy planning. Rather than simply or development plans supported by capacity extending project-based environmental assess- building provided through METAP. The second ments, EERs were expected to take place well were internal Bank strategies emphasizing different upstream of operations and therefore help in the SEA-like approaches (EERs and COEDs) as instru- setting of operational priorities. As discussed in ments to mainstream environment into the devel- more detail later, typically cost-benefit analysis opment agenda and specifically in the energy and was to be used to evaluate damage costs from environment sectors. Hence it is worth noting that energy consumption, assess the effectiveness of in MENA, SEA was not introduced as an extension proposed actions, and arrive at recommenda- of environmental impact assessment (EIA) for an tions for a set of priority investments and policy individual World Bank investment project. reforms. In Egypt, for example, the country envi- ronmental analysis (CEA) was largely influenced New Drivers by the result of the Egypt EER conducted in 2003 (World Bank 2005; World Bank/EEAA 2003). The current drivers for SEA continue to come from the countries’ demands to strengthen In other cases, CEAs played a significant role SEA capacity, which has been increased by the promoting SEAs. CEAs have been prepared for passage of the European Union (EU) SEA Directive several countries: Tunisia (2004), Egypt (2005), (2001/42/EC). According to the Directive, which Jordan (2010), and Lebanon (2011). The first came into force in 2001 for EU countries, SEA CEA in the MENA Region was initiated when the is mandatory for plans and programs.15 MENA’s government of Tunisia decided to conduct a study, Mediterranean countries are influenced by this with World Bank assistance, to assess progress because of the development support provided by achieved thus far by the National Environmental EU countries. The EU also established the LIFE- Action Plan (NEAP) and to identify the required Third Countries Program that contributes to the conditions for a greater and deeper integration establishment of capacities and administrative of environmental sustainability into social and structures needed in the environmental sector economic policy (World Bank 2004). This CEA and in the development of environmental policy recommended that “SEA, which focuses on and action programs in third countries bordering sectoral and regional aspects and on economic the Mediterranean and the Baltic Seas (Algeria, policies, should be used in a more systematic Egypt, Israel, Jordan, Lebanon, Morocco, Syria, way as an analytical tool for addressing complex Tunisia, and West Bank and Gaza). For example, environmental problems, as well as for the inte- the Ministry of Environment in Jordan is devel- gration of environmental considerations upstream oping an SEA framework with assistance from the into the decision-making process and sectoral EU to enhance the environmental mainstreaming planning� (World Bank 2004, p. 72). SEAs were process and further strengthen its role as a coordi- recommended of water resources management, nating institution for environmental protection and agricultural development and water conservation, promotion of sustainability (World Bank 2010). agricultural development and soil conservation, tourism development, and environment and trade. The Global Environment Facility Regional However, cost of environmental degradation Governance and Knowledge generation project16 (COED) studies in those areas were prepared instead of SEAs (see Box 4.1). 15 See SEA Directive at http://ec.europa.eu/environment/eia/sea-legal- context.htm. 16 The project development objective is to foster the integration of In summary, there were two main trends that environmental issues into sectoral and development policies of the influenced the evolution of SEA in the MENA beneficiaries through the production of innovative knowledge on envi- ronmental issues, with specific reference to water-related topics (fresh- Region. The first was client demand based on the water, coastal, and marine resources), and the organization of trainings where this knowledge will be used to strengthen the capacity of key need to develop a systematic way of integrating stakeholders at local, national, and regional levels. 42 Str ategic Environmental Assessment in the World Bank Box 4.1 Cost of Environmental Degradation Since the early 1990s, National Environmental Action �� A monetary valuation of the consequences (for Plans have been used to address major environmental example, estimating the cost of ill health, soil produc- issues and build environmental capacity, providing quali- tivity losses, reduced recreational values). tative assessments of the state of the environment and COED can serve as an instrument to identify areas where natural resources. Around 2000, it was clear that the environmental degradation imposes the largest costs to NEAPs did not succeed in either demonstrating the society, identify areas that most significantly undermine economic importance of the environment sector or main- social and economic development processes, provide streaming the environment into the productive sectors a basis for integrating environmental issues into the of the economy. MENA took the lead in designing a tool financial and economic evaluation of investment projects (a methodology) to assess the cost of environmental as well as in sector-wide and economy-wide policies and degradation at the national and sectoral levels. This regulations, provide a monetary basis for allocation of new approach went beyond the descriptive and quali- scarce private and public resources toward environmental tative analysis of environmental issues and focused on protection, and enhance the role of environment minis- the economic and financial implications of environmental tries in demonstrating the importance of environmental degradation for countries’ economies. protection by using the same “language� as finance and COED often takes a three-step process: economy ministers. COED helped MENA countries and the World Bank agree on priorities for environmental inter- �� Quantification of environmental degradation ventions in Country Partnership Strategies and contributed �� Quantification of the consequences of the degradation to the decision making for environment-related invest- (such as health impacts of air pollution, changes in soil ments of $1 billion. productivity, changes in forest density/growth, reduced natural resource–based recreational activities, reduced tourism demand) Cost Assessment of Environmental Degradation in the MNA countries 8 Land & Coastal Water Air Zone Waste Forest 7 6 Percentage of GDP 5 4 3 2 1 0 Tunisia Jordan Lebanon Syria Algeria Morocco Egypt Iran Source: Based on Croitoru and Sarraf 2010. under the Sustainable MED Program17 was 2011. Under this project, beneficiaries (Lebanon, approved by the Bank’s Board in November Morocco, and Tunisia to date) identify activ- ities to be financed that are consistent with the 17 Sustainable MED is a natural follow-up program to METAP, which aims project objectives. At the first Project Steering at facilitating mainstreaming environmental issues in the economic development agenda of Mediterranean countries. (See Box 4.3.) Committee Meeting held in January 2012 in World Bank SEA Experience in Middle East and North Africa: A Policy and Pl anning Tool 43 Marseille, beneficiaries consistently put forward of life of the population, they also result in lost requests for support on specific SEAs (for economic productivity. The assessment of the example, for water sector strategy in Lebanon) cost of such environmental degradation showed and for SEA capacity building. that the annual damage from air pollution was about LE (Egyptian Pound) 6.4 billion/year, corre- The second driver for SEAs is the natural sponding to 2.1 percent of Egypt’s 1999 gross evolution of clients’ environmental assessment domestic product (GDP) (Sarraf et al. 2002). systems that were strengthened by METAP. Over The energy and agricultural residues sectors the last decade, the quality and effectiveness of are significant contributors to overall damage environmental assessment systems has improved costs, principally due to their major contribution significantly in the Region. There is therefore a to air pollution and the subsequent impacts natural desire to take these systems to the next this pollution has on human health. Any policy level and to introduce and strengthen SEA as response to reducing damage costs clearly needs a tool for upstream and regional development to take into account the links between energy strategic analysis. This is, for example, the case and the environment. As a result, an EER was for some of the Gulf countries under the Gulf conducted by the World Bank and the Egyptian Environmental Partnership and Action Program Environmental Affairs Agency (EEAA). (GEPAP). This has been initiated due to the interest of the Gulf countries, which requested As mentioned earlier, EERs were introduced in similar assistance based on the success of the World Bank’s Fuel for Thought (World Bank METAP. The fee-based services program has the 2000) as a specific tool to help countries better objective to preserve, protect, and promote long- integrate environmental objectives into energy term sustainable development for the Gulf region sector development and investment. This EER and its waterways (see Box 4.2). was the first in the Region to use cost-benefit analysis (CBA) to assess policy options. The most recognized SEA approach in MENA Region is EER. The methodology and achieve- As shown in figure 4.1, a “dual track� method- ments of two EERs conducted in Egypt and Iran ology was employed: the top track involved the are discussed in the rest of this section. collection of data and the modeling of energy supply and demand; in the bottom track, a review Energy-Environment Review for Egypt (2003) of policies was undertaken to identify existing gaps and key issues. These policy options were Air pollution is a serious issue in Egypt. The parameterized to enable them to be analyzed negative impacts not only reduce the quality using CBA informed by the data and projections Figure 4.1 Egypt: EER Methodology Flowchart Energy supply & Data collection demand forecasts and review & modeling Cost-benefit Action plan analysis of for energy & policies and environment policy options Policy review Parameterization & Identification of policy of gap & key issues instruments Source: Based on World Bank 2005. 44 Str ategic Environmental Assessment in the World Bank Box 4.2 GEPAP The Gulf Basin countries are particularly concerned with �� By highlighting environmental asset valuation methods further development and management of their water that can be used to underpin policy and institutional resources, as they use the Gulf as a source of water for issues of environmental sustainability, decision makers their desalinization plants and as fisheries and shrimp can better understand the economic importance of harvesting have been less profitable than oil development protecting and restoring environmental quality as well in the economic importance of the Gulf. The health of as improving environmental performance. the Gulf clearly depends not only on better control of oil �� Expand the Gulf environmental community beyond the pollution but also on better water management in terms traditional environmental constituency to include other of both quantity and quality of the waterways and estu- sectoral ministries, private and financial sectors, and aries that feed freshwater to the northern Gulf as well civil society through improved environmental education as on the protection of marine resources from trans- and communications programming based on Gulf boundary pollutants. regional priorities. In designing GEPAP, the World Bank took into consid- �� Increasing consultations and communications among eration the experience and lessons learned from the the Gulf Cooperation Council countries and stake- regional environmental programs particularly used holders in the regional prioritization of actions in the Red Sea and METAP. The following underpins and creation of a GEPAP investment portfolio will GEPAP’s approach: strengthen cooperation in Gulf basin management. �� “Thinking Regionally, Acting Nationally�—Gulf Basin �� Strengthen Gulf Basin countries’ working relationship countries are expected to address a few fundamental with other international waters initiatives by sharing environmental issues to be strategically planned at the lessons learned and experiences. regional level but implemented at the national level and also within a multi-country context. The proposed structural design of GEPAP is as follows: National component Regional component (from the Land to the Sea) (from the Land to the Sea) Economic Tool: Preventive Tool: Curative Tool: Cost of Environmental Preparation of Gulf Pollution Load Environmental Impact Basin Diagnostic Analysis Assessment Degradation Assessment Development of the Gulf Basin Environmental Strategy and Action Plan Resource Green Mobilization Investment Source: GEPAP proposal documents. World Bank SEA Experience in Middle East and North Africa: A Policy and Pl anning Tool 45 made under the top track. The results of the CBA Reduction in local damage costs was calculated then led to the proposal for an Action Plan for depending on three different packages of policy energy and the environment. implementations, as shown in figure 4.2. The EER looked at policies designed to reduce The three achievements of the EER were reducing environmental impacts relating to six areas: subsidies, which may have contributed to price refineries, power generation (including new and increases for gasoline, heavy fuels, and diesel renewable energy), fuel switching, energy effi- fuel; enabling the World Bank to advance policy ciency, transport, and agricultural residues. The dialogue in the pollution control sector and to opportunity and damage costs were assessed, finance the Second Pollution Abatement Project in and 19 policies aimed at reducing damage costs Egypt; and providing an additional argument that were proposed (see Table 4.1). These policies enabled Egypt to ratify the Kyoto Protocol in 2005. were categorized by cost-effectiveness. The EER also recommended that policy makers reduce The EER was prepared through an intensive fuel subsidies. process of consultation between the EEAA Table 4.1 Egypt: Assessment of Policies to Reduce Damage Costs # Policies Sector Cost effectiveness 1 Mainstreaming of the Environment All A 2 Demand Side Management Energy Efficiency A 3 Standards and Labeling Energy Efficiency A 4 Promotion of Industrial Energy Efficiency (Fund) Energy Efficiency A 5 Promotion of Industrial Energy Efficiency (ESCOs) Energy Efficiency A 6 Fuel Substitution: Fund for Conversion of Industrial Facilities Fuel Substitution A 7 Reduction of Transmission and Distribution Losses Power Generation A 8 Promotion of Generation from Wind Power Generation C 9 Exhaust Emissions Standards for Existing Vehicles Transport B 10 Inspection and Maintenance of Vehicles Transport A 11 Incentives for Conversion of Vehicles to CNG Transport A 12 CNG Microbuses Transport B 13 Catalysts for New Gasoline Vehicles Transport B 14 Rationalized Burning of Agricultural Residues in the Field Agricultural Residues B 15 Centralized Collection of Agricultural Residues Agricultural Residues B 16 Market Enabling of Agricultural Products from Residues Agricultural Residues B 17 Briquetting of Maize. Agricultural Residues B 18 Support for Building Materials using Agricultural Residues Agricultural Residues B 19 Promotion of Refinery Energy Efficiency Refineries A Key: A – “win-win,� cost-effective without including damage cost reductions B – cost-effective to Egypt if reductions in local damage costs are included C – cost-effective to Egypt if reductions in global damage costs are also included Source: World Bank 2005. 46 Str ategic Environmental Assessment in the World Bank Figure 4.2 Egypt: Estimated Local Damage Costs Local Damage 8 Cost (LE billion/year) 7 8 6 6.5 6.7 5 5.8 5.2 4 3 2 1 0 1999/2000 2010-2011 2010-2011 2010-2011 2010-2011 Business as usual with Policy with Price with Combined Package readjustment Programs Source: Based on World Bank 2005. and the World Bank. Unlike SEAs produced as costs would grow to $12 billion, or 6.6 percent of part of project preparation in response to the nominal GDP, by 2019. The main underlying cause Bank’s safeguard policies, the Egypt EER was an for this significant cost was the use of subsidized analytical and advisory activity that was prepared fossil fuels. A combination of two policy interven- to guide implementation of the country’s national tions—price reform and sectoral measures, plus environmental action plan, particularly relating to different time sequences for implementing price the energy and agricultural residues sectors (Pillai reforms—was used to construct 12 scenarios. and Mercier 2007). Each scenario was then evaluated in terms of local environmental damages, cumulative oppor- Energy-Environmental Review for Iran (2004)18 tunity costs, and impact on inflation. The latter was selected as an indicator of the political feasi- The challenge before Iran was how to improve bility of implementing the proposed measures. environmental protection while promoting economic growth in a context where energy has The scenario analysis showed that only a combi- been traditionally subsidized due to its relative nation of price reform and sectoral measures can abundance and the low income levels of most bring environmental damage costs below the of the population. The government accordingly 2001 level in 2019. Furthermore, it demonstrated requested World Bank assistance in reforming that phasing out subsidies by 2009 held the Iran’s energy policy to enhance economic and greatest benefits for the environment but corre- environmental sustainability. An EER was selected sponded to a larger increase in inflation. After as the tool for carrying out the necessary analysis. holding a consultation workshop with govern- mental officials, the EER concluded that early The EER estimated that without price reform price reform would be politically difficult, and it and policy intervention, environmental damage therefore proposed scheduling the elimination of subsidies for 2014 or 2019. Some of the recom- 18 This section is a summary of Environment Strategy Note No. 17 (Kobayashi et al. 2006). mendations contained in the EER—notably, those World Bank SEA Experience in Middle East and North Africa: A Policy and Pl anning Tool 47 on price policy instruments—were included in the Strong Link between Country Ownership country’s Fourth Five-Year National Development and Effective Implementation of SEA Plan (2006–2010). Strong country ownership in environmental main- The most important lesson from the EER for Iran streaming underlies SEA effectiveness in MENA. is that environmental considerations can influence For example, an EER recommended reducing energy policy if their economic and welfare rele- damage costs through readjusting pricing vance is highlighted and if they are presented in policies and a set of policies. The recommenda- a format adapted to the mindset and outlook of tions were taken seriously by the government policy makers. In particular, assessment of envi- and some of them implemented. As a result, fuel ronmental impacts by estimating environmental substitution was accelerated and use of the Clean damage costs in monetary terms plus analysis of Development Mechanism for pollution abatement alternatives for environmental protection through was promoted in Egypt. Country ownership a range of scenarios using cost-benefit analysis is essential for achieving results through SEA can form the basis for a compelling argument that implementation. has the potential to influence strategic decision making. Not only are environmental issues SEA as an Instrument to Mainstream presented on an equal footing with economic and Environment to Promote Policy Dialogue growth indicators, but this type of assessment SEA in MENA was not introduced as an instrument provides policy makers with a set of straight- for environmental impact assessment but as an forward, comparable alternatives for consid- instrument to mainstream environment into the eration in the light of both national goals and development agenda. The Egyptian and Iranian political feasibility. EERs were SEA-type activities that were prepared to guide implementation of national environmental Interestingly, Iran recently began eliminating action plans. Therefore the EER contributed to energy subsidies. On December 18, 2010, Iran advancing policy dialogue and identifying new increased domestic energy and agricultural areas of collaboration. For example, the EER prices by up to 20 times, making it the first major contributed to promoting dialogue in the pollution oil-exporting country to reduce implicit energy control sector, which led to the Egypt Second subsidies substantially (IMF 2011). Although Pollution Abatement Project.19 there is no evidence to show the direct link between the recommendation of the EER and the Regional Technical Assistance that current policy reform, it is certain that the EER Facilitates Donor Partnership and contributed to expanding the policy horizons of Contributes to Capacity Building the main stakeholders, which facilitated opening up a discussion on energy pricing and subsidies Regional cooperation and technical assistance among public officials. have provided support for MENA countries to improve their capacity to conduct SEA. A well- structured learning program for the use of SEA as Lessons Learned a decision-making tool was established through METAP. Training workshops on environmental Although the number of SEAs conducted in strategic assessments for water and the coastal MENA is relatively small, the lessons learned were zone, implementation of a solid waste regional drawn from the regional experience on SEA. Four lessons learned—on ownership, being an 19 The pilot Egyptian Second Pollution Abatement Project was imple- instrument to mainstream environment, regional mented in 1996, and the second phase of the project was expanded to a scale of $160 million cofinanced projects to demonstrate, in the technical assistance, and as a supplemental quan- Egyptian context, the applicability of market-based financial/technical approaches for achieving significant pollution abatement in selected titative tool—are discussed here. hot spots areas in and around the Alexandria and Greater Cairo areas. 48 Str ategic Environmental Assessment in the World Bank project by the regional group within NEAP, interest and raise awareness of environmental and training on water quality management and issues because it is far easier for decision coastal zone management were carried out. makers to incorporate and prioritize envi- ronment when the issues can be cast in clear Regional coordination also facilitated the donor economic terms (Sarraf 2004). In Tunisia, the partnership. In Tunisia, for instance, coordination COED study was presented to the Council of with development partners in the preparation of Ministers in a session chaired by the president the CEA was achieved through engagement with of the country. The 2006 Quality Assurance METAP, the European Commission, the European Group report found that the COED was well Investment Bank, the United Nation Development received by policy makers in Tunisia and that Programme, and the governments of Finland and the Bank’s CEA was still frequently being used Switzerland to promote a regional technical assis- and quoted (World Bank QAG 2006). tance program for water quality and coastal zone management, municipal waste management, and the development of environmental policy tools. Way Forward Donor coordination was strengthened through CEA and METAP, as indicated by a number of The Arab Spring has resulted in an increasing joint follow-up activities (Pillai 2008). demand for participation of stakeholders in decision-making processes. As we have seen in Supplemental Quantitative Tools that Make Eastern Europe, this process is one that takes SEA More Effective in Priority Setting time to mature, especially when the concept is fairly new to the countries. In that regard, Quantitative approaches, conducted as part of SEA provides a formal basis for facilitating a the SEA, have been crucial for more effective structured consultation between the public priority-setting. Despite the difficulties involved sector and a broader range of stakeholders, as in assigning monetary costs to environmental happened in Eastern Europe and South Asia. degradation, such estimates can be a powerful SEA particularly has been increasingly used as means of raising awareness about environ- a formal mechanism to involve different stake- mental issues and facilitating progress toward holder groups in strategic decision making at sustainable development. With that intention, the policy, program, and plan levels. In MENA, cost assessments of environmental degra- the World Bank has played a major role during dation and adjusted net savings, which take the last 20 years in helping to put in place into account loss of wealth such as fish, ground- and strengthen EIA systems in countries in water, and soil resources, were developed to the Region. This strong previous engagement quantify environmental externalities (for example, provides a real opportunity to support countries effects on health or natural capital) and to assess taking EIA implementation to a different level these costs and benefits and their impacts on through strengthening participatory approaches sectoral policies. and through supporting the introduction and implementation of SEAs at a more strategic level The COED reports were prepared under of decision making. The entry points for use of METAP as a first step in a process toward using SEA are two existing shared programs: the Gulf environmental damage cost assessments for Environment Partnership and Action Program priority setting and as an instrument for inte- described in Box 4.2 and the Sustainable MED grating environmental issues into economic and program briefly described in Box 4.3. social development in the MENA Region. These reports were prepared for Algeria, Egypt, In MENA, though the concept of SEA is widely Iran, Jordan, Morocco, and Syria during 2001– shared as a process for environmental inte- 2005. COED has helped generate government gration in policies, plans, and development World Bank SEA Experience in Middle East and North Africa: A Policy and Pl anning Tool 49 Box 4.3 Sustainable MED The Mediterranean Environmental Sustainable dialogue between Ministry of Environment, Ministry Development Program—Sustainable MED—was of Finance, and other sector ministries); among donors conceived by the World Bank and the Global Environment and partners (Agence Française de Développement; Facility to help governments in the Mediterranean region European Community (EC); EIB; United Nations ensure the sustainability of their natural resource base Environment Programme); and among regional initia- in support of their economic development. Sustainable tives (Barcelona Convention, Mediterranean Action MED is one of the foundational programs of the envi- Plan, Strategic Partnership for the Mediterranean Sea ronment and water cluster of the Marseille Center for Large Marine Ecosystem, EC- and EIB-funded programs Mediterranean Integration. In its first phase, Sustainable and facilities, Union for the Mediterranean). MED focuses on water resources and coastal zone �� Projects:Sustainable MED will promote on-the- management, while future phases will ideally broaden the ground environmentally sound development through spectrum of focal areas. investment lending and technical assistance. Various Sustainable MED will achieve its objective through a projects (including the Governance and Knowledge combination of policy dialogue, investment lending, and generation project) can be conceived, prepared, and/or technical assistance: implemented under the Sustainable MED Program. �� Policy dialogue: Sustainable MED will promote coor- dination at the beneficiary level (cross-sectoral strategies, environmental mainstreaming activ- strong demand for a participatory approach to ities supported by the Bank often utilize tools promote the effective involvement of local actors with different names, such as EERs and COED. in environmental management from Morocco EERs, in particular, can be considered a policy and support for civil society participation and SEA approach. COED has become quite popular nongovernmental organizations from Tunisia. and has established its brand among the While consultations were conducted when the Region, especially because of its quantitative Egyptian EER was developed, the stakeholders nature. However, there is a window of oppor- consulted were limited to government agencies. tunity for SEA to build upon COED if the SEA Establishing how best to introduce wider partici- participatory component is stressed. At the first patory approaches to countries unfamiliar with Project Steering Committee Meeting of the these practices would be critical to further Governance and Knowledge generation project, promotion of SEA in the MENA Region. held in January 2012 in Marseille, there was 50 Str ategic Environmental Assessment in the World Bank References Croitoru, L., and M. Sarraf. 2010. The Cost of Environmental Degradation – Case Studies from the Middle East and North Africa. Washington, DC: World Bank. IMF (International Monetary Fund). 2011. Working Paper Iran—The Chronicles of the Subsidy Reform. Washington, DC. Kobayashi, H., S. Arif, and F. Loayza. 2006. Environment Strategy Note No. 17. Washington, DC: World Bank. Pillai, P. 2008. Strengthening Policy Dialogue on Environment—Learning from Five Years of Country Environmental Analysis. Washington, DC: World Bank. Pillai, P., and J. R. Mercier. 2007. Learning from First-Generation Strategic Environmental Assessments Supported by the World Bank. Washington, DC: World Bank. Sarraf, M. 2004. Environment Strategy Note No. 9. Washington, DC: World Bank. Sarraf, M., et al. 2002. Cost of Environmental Degradation. Washington, DC: METAP/World Bank. World Bank. 2000. Fuel for Thought—An Environmental Strategy for the Energy Sector. Washington, DC. ———. 2001. Environment Strategy. Washington, DC. ———. 2004. Tunisia Country Environmental Analysis (1992–2003). Washington, DC. ———. 2005. Arab Republic of Egypt Country Environmental Analysis (1992–2002). Washington, DC. ———. 2010. Jordan Country Environmental Analysis. Washington, DC. ———. 2011. World Development Indicators 2011. Washington, DC. World Bank/EEAA (Egyptian Environmental Affairs Agency). 2003. Egypt: Energy-Environment Review. Washington, DC. World Bank Middle East and North Africa Region. 2001. Environment Strategy Update 2001–2005. Washington, DC. World Bank QAG (Quality Assurance Group). 2006. Country AAA Assessment for Tunisia- TN-GPG Country Environmental Analysis Report. Washington, DC. World Bank SEA Experience in Middle East and North Africa: A Policy and Pl anning Tool 51 chapter 5 World Bank SEA Experience in South Asia From Impact-Centered to Policy Approaches Paula Posas and Ernesto Sánchez-Triana20 Afghanistan Nepal Bhutan Pakistan India Bangladesh Sri Lanka Maldives 20 Paula Posas is a consultant and Ernesto Sánchez-Triana is Lead Environmental Specialist. This paper benefited from inputs and comments from Fernando Loayza, Yves Prevost, Dan Biller, Ken Green, Javaid Afzal, Darshani de Silva, Shakil Ferdausi, Drona Ghimire, Nagaraja Rao Harshadeep, Priti Kumar, Tapas Paul, Sumith Pilapitiya, Easha Ramachandran, Arif Rasuli, Nadia Sharmin, Sanjay Srivastava, Jeff Lewis, and Mohammed Khaliquzzaman. 52 Str ategic Environmental Assessment in the World Bank Introduction and Methodology The research methodology underpinning this chapter involved structured and unstructured In order to help World Bank staff and country interviews with Bank staff, extensive online teams in the South Asia Region (SAR) use stra- searches, and questionnaire surveys sent to tegic environmental assessment (SEA) more field office colleagues with experience in EIA effectively, this chapter takes stock of the and SEA in Afghanistan, Bangladesh, Bhutan, evolution of SEA application there, focuses on India, the Maldives, Nepal, Pakistan, and Sri results and lessons learned from nine SEA case Lanka. Based on survey responses, and in studies, and identifies opportunities for moving some cases taking into consideration previ- the South Asia regional SEA agenda forward. ously documented SEA experiences, case SEA is understood here in a broad sense and studies were selected to illustrate lessons includes a variety of instruments, from environ- and good practices. Document review and mental impact assessment (EIA) of large projects interviews were then used to grasp relevant to policy strategic environmental assessments.21 contextual factors and identify the reasons for specific outcomes or challenges. These A high percentage of SEAs in SAR use impact- and other factors are further explored in the centered SEA to comply with national regulations analysis of the case studies. Data collection and the “safeguard� requirements of international from Bank staff and survey responses inform development organizations. In South Asia, the final section on recommendations for the impact-centered SEAs include instruments such way forward. as regional environmental assessment (regional EA), sectoral environmental assessment (sectoral EA), strategic basin assessment (SBA), cumulative Evolution of SEA South Asia environmental assessment (cumulative EA), Even before 2001, when SEAs received a new cumulative impact assessment, and EIAs of large impetus and validation through the World Bank’s projects22 that are considered strategic. first Environment Strategy, there were important stirrings of impact-centered SEA activity in SAR. Representing a different approach, policy SEAs Impact-centered SEAs—particularly sectoral and and institution-centered SEAs have increasingly regional EAs—as well as environmental reviews been used in South Asia to mainstream understood to be SEAs had already been environmental sustainability, social issues, and undertaken and completed in various countries, poverty alleviation into public policy design including Bhutan, India, Nepal, and Pakistan and implementation. Strategic environmental, (Rajvanshi 2001; Kjörven and Lindhjem 2002). In poverty, and social assessment (SEPSA) and addition to the World Bank, other development country environmental analysis (CEA) 23 are banks and agencies were experimenting with examples of these types of SEA. this new tool in the Region (see, for example, Adhikari and Khadka 1998; IUCN 2000; Naim 21 The Development Assistance Committee of the Organisation for Economic Co-operation and Development defines SEA as a range 2002). Though EIA legislation is common in of “analytical and participatory approaches that aim to integrate environmental considerations into policies, plans, and programs and the Region (Khadka and Shrestha 2011), only evaluate their inter-linkages with economic and social considerations� Bhutan has a legal requirement for impact- (OECD-DAC 2006, p. 17). 22 According to Paul (2012, personal communication), environmental centered SEA. Bhutan’s Regulation on Strategic impact assessment of large projects includes the “India type SEAs,� Environment Assessment was adopted under meaning social and environmental assessment. 23 Most CEAs in the World Bank are done with particular priorities iden- the Environmental Assessment Act (2000) of tified, issues to be solved, and objectives in mind that are addressed Bhutan and came into effect on April 24, 2002, strategically. It is these CEAs that are being included in this study as SEAs. Furthermore, Dalal-Clayton and Sadler (2005, p. 132) refer to but has not yet been implemented (Annandale CEA as a “para-SEA tool,� and it has been previously argued that CEA can be viewed as a type of SEA (Posas 2011a, 2011b). and Brown 2012). World Bank SEA Experience in South Asia: From Impact-Centered to Policy Approaches 53 Figure 5.1 shows the proportion of SEAs by country words “strategic� and “social�), and SEAs began for the 43 identified Bank-supported SEAs under- to be carried out more frequently again after a taken in SAR between 1993 and early 2012, and relative lull between 2002 and 2004. Strategic Figure 5.2 shows them by sector. basin assessments, which appear to have origi- nated in SAR, were the only instrument to span The majority of SEAs (58 percent) were the 2004/2005 transition point, and they continue conducted in India, followed by Pakistan (16 to be undertaken. percent) and Nepal (12 percent). The largest proportion of SEAs have been carried out for The post-2004 shift in SEA titling and greater the transport sector (28 percent), followed by use of policy SEA instruments may be explained the water resources sector (16 percent) and the by two developments. In August 2004, a new energy sector (14 percent). Nearly all of the World Bank Operational Policy was approved SEAs in the energy sector have been for hydro- (OP 8.60 Development Policy Lending) that power projects. acknowledged the need for “upstream analysis stan of social and environmental conditions and n A trend was seen in the use of different types risks� and mentioned policy SEA and CEA as of SEA instruments over time. There was a tools to carry out such analysis (Dalal-Clayton definite shift in the use of certain types of and Sadler 2005). Then in 2005 the World Bank SEA instruments after 2004. Before then, only established an SEA Pilot Program to test and impact-centered SEAs, particularly sectoral and promote institution-centered SEA approaches in regional EAs, were done, along with a few EIAs policy and sector reform, providing grants and considered to be SEAs. Interestingly, however, specialized assistance to up to eight pilot SEAs in the words “sectoral EA� and “regional EA� were the Regions. Two of these pilots were in SAR (the not used in titles after 2004. In 2005, policy SEAs Industry Development Dhaka Metropolitan Plan and Transport Water the Energy Country with different titles emerged (most involving the Pakistan SEPSA). Figure 5.1 Figure 5.2 Proportion of SEAs in SAR by Country Proportion of SEAs in SAR by Sector Rural Tourism Urban Nepal Bangladesh Mining 5% 5% 5% 12% 9% Afghanistan 5% Coastal 2% 3% Country Conservation 2% Bhutan Pakistan 9% Industry 2% 2% 16% Agriculture Transport 7% 28% India 58% Energy 14% Water 16% Source: Based on Annex 5.1 Source: Based on Annex 5.1 54 Str ategic Environmental Assessment in the World Bank Case Studies environmental risks (less challenging upgrades were done first), and early design changes could SEAs fall along a continuum between impact- be made to avoid adverse social and environ- centered and institution-centered. Nine case mental impacts. Examples of socially sensitive studies are described in this section. design changes included consideration of the resettlement of project-affected people and Impact-centered SEAs significant efforts to enhance and protect sites of archeological heritage and cultural signifi- The cases profiled below concerning roads cance (shrines and temples along the roadsides). and hydropower would be classified as impact- Examples of design changes on the environment centered SEAs, and they involved rigorous side included allowance for placement of large screening and assessment of alternatives that trees in medians, provision of bus stop platforms, helped avoid controversy and reduced the overall and paving of shoulders to facilitate nonmo- cost of investment. torized transport. After discussions between the government of Gujarat and the World Bank, the Case 1. EMU was created. Gujarat State Highway Project Sectoral EA 24 This SEA has been commended for its simul- The Gujarat State Highway Project (2000–07) taneous approach to social and environmental had three main components: road improvement, impacts, collection and analysis of data, and including widening and strengthening; periodic public consultations and integration of feedback maintenance, such as asphalt overlays; and into the design of mitigative actions (Kjörven institutional development. In 1995, some 3,000 and Lindhjem 2002). Also noteworthy is that the kilometers of state highways were evaluated project intended to retain a nongovernmental in a strategic options study carried out by Lea organization (NGO) to evaluate implementation Associates South Asia, with 1,500 kilometers of the EMAP and RAP midway through and at the selected for detailed studies. The three objec- end of the project, demonstrating commitment to tives of the sectoral EA were: accountability and follow-up. ■■ Toperform an environmental screening of the Case 2. road corridors based on data collected through Sectoral EAs of Tamil Nadu, Karnataka, detailed field surveys and updating of strip Kerala, Uttar Pradesh, Mizoram, and Manipur maps Highway Projects ■■ Toprovide a practical plan for mitigating and In the late 1990s and early 2000s, several sectoral monitoring impacts that would stem from EAs were completed for Indian State Highway construction and future operation of the roads Projects in Tamil Nadu, Karnataka, Kerala, Uttar Pradesh, Mizoram, and Manipur. The objectives ■■ Todesign and start an Environment included an environmental screening of the road Management Unit (EMU) to implement the corridors, the design of impact mitigation plans for Environmental Management Action Plan construction and operation of the roads, and the (EMAP) and Resettlement Action Plan (RAP). design and start-up of environmental management units to implement environmental management Due to the information collected and coor- plans and resettlement action plans. dination with the engineering design team, implementation phasing integrated social and In 2003 the World Bank South Asia Environment and Social Development Unit issued a dissemi- 24 This case was adapted from Kjörven and Lindhjem 2002 and from Fang 2006. nation note highlighting the key findings of a World Bank SEA Experience in South Asia: From Impact-Centered to Policy Approaches 55 comprehensive analysis of these sectoral EAs. a regulatory tool to support natural resource and Findings included issues with timing (assessments economic risk management. initiated too late in project preparation and/or not completed on time) and report quality (weak The full EA process consisted of an update of analysis of alternatives, insufficient highlighting the nationwide inventory of sites suitable for of regional/sectoral issues, lack of structured medium-scale hydropower projects, a two-stage recommendations). It was also observed that the review of technoeconomic and social and envi- sectoral EAs were done primarily to meet Bank ronmental parameters of potential projects and clearance requirements and were not, as then sites, use of technoeconomic and social and undertaken, serving as a decision-making tool. environmental S&R criteria developed through a The note made the following recommendations consensus process, and provision of open consul- for increasing the applicability of sectoral EAs: tation and information sharing with government make improvements in the timing of carrying stakeholders, the professional community, NGOs, out sectoral EAs; work to establish sectoral EAs and the general public on each step of the S&R as a decision-making tool, not just a clearance process. The main result was the progressive requirement; adopt a wider scope to include narrowing of potentially feasible projects from the road sector as a whole and not just focus 138 in the inventory to 44 in a coarse screen, on project roads; and develop further practical to 24, and finally to 7 “highest acceptability� guidance beyond the existing Environmental projects to proceed to the feasibility stage. The Assessment Sourcebook Updates on sectoral and S&R (functioning as an analysis of alternatives) regional environmental assessment. constituted the backbone of the sectoral EA. Case 3. At least 2 of the 7 “highest acceptability� hydro- Nepal Medium Hydropower SEA 25 power options were identified for development, 1 to be funded by the World Bank and the other by In the mid-1990s, only about 10 percent of the government of Nepal. The S&R process also Nepal’s population enjoyed the benefits of significantly contributed to capacity building of power supply, and there were strong efforts to partners on the project team and in government address this by tapping Nepal’s rich hydropower ministries. The assessment overall was completed potential—stemming from steep rivers and high in time to contribute to the new Hydropower flows fed by snowmelt in the Himalayas and by Policy, which promotes private sector investments winter and monsoon rains. In the wake of contro- in the energy sector. It has been noted that the versy following cancellation of the planned 402 sectoral EA overall provided a strong basis for megawatt (MW) Arun II Hydroelectric Project, the future decision making. government of Nepal and the World Bank agreed in 1995 to pursue a medium-scale hydropower Policy and Institution-Centered SEAs development strategy and establish a power development fund. Eligibility for its support In a recent World Bank note, policy SEA was would be based on screening and ranking (S&R) defined as “an analytical and participatory of identified potential medium-sized projects approach for incorporating environmental, social, between 10 and 300 MW. The S&R as well as and climate change considerations in sector other efforts would take place within the context reforms� (Loayza et al. 2011). Institution-centered of a sectoral EA, whose purpose was to inte- SEAs place particular emphasis on assessing the grate environmental and social considerations institutions and governance systems that underlie into Nepal’s power sector planning process in a environmental and social management. The cases transparent and consultative way and to develop highlighted here are of SEAs done at the policy level or with an institution-centered focus. 25 Based on Kjörven and Lindhjem 2002 and on Hirji et al. 2007. 56 Str ategic Environmental Assessment in the World Bank Case 4. address within the context of natural changes Pakistan Green Industrial Growth SEA already present in the Sundarbans. Ongoing deltaic subsidence over the past 150 years, A recent policy SEA in Pakistan concerns compression and settling of soils behind embank- Mainstreaming Sustainability into Pakistan’s ments, and haphazard human-made changes that Industrial Competitiveness. The SEA was affect river dynamics and tidal flows have under- steered by a High Level Committee set up by mined the natural processes normally responsible the Ministry of Industries and representing the for adaptive change to occur. The studies found federal government, four provincial governments, that embankment erosion and collapse have academia, NGOs, the private sector, and the become routine and that soils have become more World Bank. The SEA promoted a consensus- saline. These types of occurrences are likely to be building process that resulted in formulation exacerbated by future climate change impacts. of a coherent and sustainable industrialization strategy. The SEA stresses that industrial struc- The menu of options that emerged from the tural change, spatial transformation, and improve- NLTA promotes building resilience and adaptive ments in infrastructure in industrial clusters are capacity in the Sundarbans through four interre- needed if Pakistan is to realize gains in economic lated pillars: efficiency and competitiveness, especially in export markets. This in turn requires a cross- ■■ Reduction of vulnerability of human settlements sectoral approach that has been endorsed to historical and future natural changes and by the Planning Commission and the Ministry disasters via estuary management and disaster of Industries, which has requested program- risk management matic lending support for the implementation of Pakistan’s green industrial growth strategy. ■■ Povertyreduction through capturing livelihood opportunities, building human capital through Case 5. improving health and education, and improving West Bengal Sundarbans Non-lending Technical the quality of life through provision of basic Assistance (NLTA) physical infrastructure At the request of the government of West Bengal, ■■ Biodiversity conservation through incentive the World Bank initiated a non-lending technical measures, property rights and co-management assistance on the Sundarbans with the objective initiatives, partnerships, mangrove restoration, of assessing priority issues and identifying policy and marine protection options that the government might adopt to address issues of socioeconomic development change to clarify functions and ■■ Institutional and biodiversity conservation in a changing roles of agencies, promote coordination func- climate. The NLTA, entitled Building Resilience tions, and build international partnerships for Sustainable Development of the Sundarbans with Bangladesh. through Estuary Management, Poverty Reduction, and Biodiversity Conservation, involved 21 In line with these pillars, the SEA identified a studies of unprecedented richness of analysis series of priority interventions that distinguish across disciplines over a two-year period.26 As between three geographic zones and can be highlighted in the studies, current climate change classified as spatially blind interventions that predictions indicate that issues of poverty and address basic entitlements and needs wherever vulnerability will be increasingly difficult to people reside, spatially connective interventions that facilitate access between geographic zones, 26 Study topics included climatology, geomorphology, economics, education, health, social anthropology, demography, ecology, tourism, and spatially targeted interventions that account water and sanitation, energy, agriculture, forestry, fisheries, and management. for differing conservation and development World Bank SEA Experience in South Asia: From Impact-Centered to Policy Approaches 57 needs. The SEA also supported bilateral dialogue and developed a menu of options to mitigate between India and Bangladesh on the shared negative impacts, to incorporate poverty alle- Sundarbans ecosystem. Both countries signed a viation measures into the design of transport Memorandum of Understanding in September reforms and projects, to enhance positive effects 2011 to formalize their interest in cooperating in on poverty alleviation, and to address envi- joint management and monitoring of resources. ronmental and social priorities. Strong gover- The SEA also built a platform for multistakeholder nance and institutional capacity in sectoral dialogue about biodiversity, livelihoods, and and environmental agencies were highlighted natural hazard risk management. as indispensable for the adoption of the options identified. Case 6. SEPSA of Pakistan Freight Transport Reforms Findings from the Pakistan SEPSA include that a modal shift from road freight to rail freight In order to ensure meaningful discussion among transport for long hauls would have significant key stakeholders in the identification of specific environmental and social benefits; that sustainability criteria that would be incorpo- environmental issues should not be considered rated into transport reforms, the government in isolation from social ones, particularly in of Pakistan and the World Bank held a series of societies with significant social conflict; and workshops during 2009 to scope out the studies that understanding social patterns and conflicts that would be completed using methodologies illuminates the feasibility and weaknesses of developed for policy SEAs and poverty and potential solutions and needed mitigation social impact analysis (PSIA). This gave rise to measures. To stimulate economic growth, the Pakistan Freight Transport SEPSA. The envi- employment, and poverty reduction, reforms ronmental management component of SEPSA to promote industrial competitiveness need focused on the environmental aspects of invest- to be made along with significant investments ments and reforms in the trade and transport in increasing road density to improve the sector, particularly freight. The potential envi- connectivity of industrial clusters to domestic ronmental effects of three strategic alternatives and international markets. Strengthening the were analyzed: the “no reforms� alternative, infrastructure of urban centers to receive migrants policy reform and investment in the road freight is also required. sector, and policy reform and investment in the rail freight sector. Each alternative was eval- Country Environmental Analyses uated based on the set of priority issues iden- tified jointly with stakeholders (climate change, Country environmental analyses in SAR have air quality, transport of hazardous materials, road been undertaken in Bangladesh, India, Pakistan, and railway safety, urban sprawl and accessi- and most recently Nepal. The Bangladesh and bility, and environmental management systems) India CEAs are profiled here for their main to assess their potential environmental and features, processes, results, and lessons.27 social implications. Case 7. The PSIA was prepared to identify potential Bangladesh CEA social and distributional impacts of transport sector reforms on stakeholder groups, employing The objective of the Bangladesh CEA (2006) was a computable general equilibrium model that to improve the environmental content of the final uses actual economic data to simulate how poverty reduction strategy paper (PRSP) and an economy might react to changes in policy to strengthen the environmental foundation for or other external factors. The PSIA identified the main effects of proposed policy reforms 27 These CEA case studies have been adapted from Posas 2007. 58 Str ategic Environmental Assessment in the World Bank the sequence of adjustment poverty reduction help strengthen the environmental policy imple- strategy credits expected over the next several mentation framework for meeting the challenges years. The process centered on four principal of India’s rapidly growing and extraordinarily tasks: identification of priority environmental diverse economy. The CEA scope of work concerns for sustainable, poverty-reducing devel- included a policy review and gap analysis, eval- opment; analysis of the policies affecting the uation of implementation effectiveness using priority environmental concerns; assessment of case studies, identification of priority issues environmental management capacity and perfor- and measures for institutional development and mance in relation to the identified priorities; and capacity building, and development of strategy/ development of a set of proposals to support action plans to implement the agreed priority improvements in the management of key environ- measures. The case studies of implementation mental concerns. It involved undertaking both a experiences involved primary data collection and cost of environmental degradation (COED) analysis consultation with local stakeholders to gain a and a public environmental expenditure review. deeper understanding of obstacles and contrib- utors to better environmental performance The Ministry of Environment and Forests and and compliance in real-life situations. The more the World Bank jointly selected a set of priority detailed insights from the case studies comple- issues based on their relevance to growth and mented reviews of secondary data. The CEA poverty reduction and taking into account new focused on industry, highways, and power, which analytical work and the scope for subsequent were among the key drivers of growth in India. action. Priorities included protecting water Also, the sectors together represented a wide quality in Dhaka, sustaining soil quality, managing range of environmental impacts, sources, and capture fisheries, and strengthening institutions regulatory issues of broad relevance. for environmental management. As a result of the COED’s quantification of economic losses from The main recommendations of the CEA included environmental degradation, other priorities for passage of the Right of Information Act, stra- additional action and Bank support emerged, tegic assessment of low-carbon growth options, such as reducing the threat of air pollution to and design of effective packages for clusters of human health and the need to better control small and medium-size enterprises. Overarching urban and industrial effluent in Dhaka. recommendations, such as improving access to information and empowering local governments, Several projects followed up, taking into account were also made. Finally, the need to develop a the CEA findings. These included the Second medium- to long-term program supported by Urban Air Quality Project, the Indoor Air Pollution necessary resources, targets, and clear account- Technical Assistance Project, and the Dhaka ability mechanisms was emphasized. Environment Management Project, which is tackling rapid urban growth. The CEA influenced The CEA influenced national policy, had the environmental content of the PRSP and was cascading impacts at the state and project meant to serve the donor community more widely levels, strengthened capacity of ministries as well as to guide World Bank environmental and stakeholders, and elevated the priority of support to Bangladesh. environmental issues in the country assistance strategy update and in India. With regard to the Case 8. Pollution Control Boards, the additional leverage India CEA provided by the CEA facilitated some strategic realignment of their activities and the hiring of As stated in India, Strengthening Institutions new professional staff. Information from the India for Sustainable Growth: Country Environmental CEA has strengthened several projects so far, Analysis (2007), the purpose of the CEA was to including a capacity-building project to develop World Bank SEA Experience in South Asia: From Impact-Centered to Policy Approaches 59 more-specific action plans and development and replication of this SEA pilot in all but one policy loans in several states. It identified several of the basins within Tamil Nadu in a follow- states with major projected investments in on project. environmentally sensitive sectors, leading to two SEAs—one on mining in Orissa and another on Some of the lessons learned from the Palar Basin water resources management in northeast India. SEA experience include the need for shared appreciation of the interrelationship of issues Blend of Impact and Institution-Centered and options in a basin; the critical need for key SEA: Strategic Basin Assessment stakeholders (especially counterpart government institutions) to have ownership, demand, and The strategic basin assessment, which appears buy-in so that they play a catalytic and arbitrator to have arisen in and be most commonly under- role; the need to consider environmental, social, taken in SAR, exemplifies the blending of SEA and economic issues in an integrated way; the approaches. The Palar Basin SBA, for example, value of a structured plan for stakeholder partici- is regional in the sense of the basin being the pation; and the need for tangible outcomes regional focus, it is sectoral (focused on water early in the process (low-hanging fruits) to retain resources), and it addresses planning, policies, stakeholder interest and participation. Last, it was institutions, and impacts. learned that a subbasin-level approach, such as within a town or city, would enable stakeholders Case 9. to interact around a more limited set of issues SEA for Water Resources Planning, Palar Basin, and make decisions at a more appropriate level. India28 Collecting the views of stakeholders scattered hundreds of kilometers apart proved unwieldy. The Palar River Basin in Tamil Nadu state in south India has a population of 5.4 million people and covers 18,000 square kilometers. Since Discussion of Case Studies the Palar River runs for only a few days during the northeast monsoon season, the popu- This section focuses on observations about and lation is highly dependent on adequate, good- lessons drawn from the nine SEA case studies. An quality water from tanks and groundwater. This attempt is made to distill the overarching points SEA aimed at setting a common framework for to improve future SEA practice. handling critical water resource issues in the Palar Basin. The first phase consisted of scoping, Results with impact-centered SEA overall have capacity building, identification of issues, and been mixed in SAR, with some SEAs having formation of a vision and guiding principles. The admittedly very little influence. As discussed, SEA engaged a wide set of stakeholders, and the sectoral EAs of Indian State Highway Projects had interrelationship between environmental, social, limited influence in terms of guiding the project and economic issues was emphasized throughout or the sector on specific decisions, either on the process. The second phase involved an policy or institutions. Early REAs in India showed Action Plan to address the key issues of water mixed results.29 On the other side, there have availability, water quality, and sand mining. been not only some very successful and influ- Progress was made through additional funding ential policy SEAs but also spontaneous, country- approved for agriculture and water management initiated SEAs and SEA training efforts within the in Tamil Nadu, industry upgrades and improved Region (see SchEMS 2004). regulation of water quality, new sand mining regulations implemented throughout the state, 29 However, according to Kumar (personal communication, 2012) and Paul (personal communication, 2012), these environmental assess- ments initiated robust thinking around environment assessments and environmental management frameworks in the rural and agricultural 28 Based on Hirji et al. 2007. sector in India at a time when the pipeline in this sector was growing. 60 Str ategic Environmental Assessment in the World Bank Bank-supported SEAs have arisen in multiple These types of benefits were seen in a number ways with various purposes, as shown in the of the profiled cases. The CEAs and policy SEAs nine cases profiled, which span from 1996 to generally led to significant influence and results the present. Sometimes their impetus has been due to the benefits listed above: identifying discussions between Bank staff and management environmental priorities associated with poverty or clients’ governments (Pakistan SEPSA, Pakistan alleviation (all cases), highlighting governance Green Industrial Growth SEA, and West Bengal gaps or constraints (all CEAs, Sundarbans, and Sundarbans SEA). In some cases an opportunity Pakistan SEPSA), promoting capacity building or need was seen initially by a single task team (India CEA and Pakistan Green Industrial Growth), leader (Palar Basin SBA and India CEA). There strengthening accountability and transparency are cases in which the Bank has recommended (Bangladesh and India CEAs), and empowering a CEA as a condition of going forward with weaker stakeholders (India CEA, Pakistan SEPSA, potential development policy lending, and some- and Palar Basin SBA). times SEAs are initiated to help move forward and overcome controversy (Nepal Hydropower Regarding empowering weaker stakeholders, SEA). Several SEAs have been driven or incen- particularly the poor, CEAs and policy SEAs tivized through donor funding and pilot programs were the most likely to explicitly address political (SAR CEAs, Dhaka SEA). The majority of country economy issues. Through public consultations office staff polled reported that most SEAs in and outreach, they were able to ensure that some the Region remain driven by international devel- of the follow-up actions focused on poverty opment bank or agency requirements. alleviation and addressed citizen and stake- holder concerns. SEAs attentive to poverty issues It has been observed that benefits of policy SEA include the Bangladesh CEA, which focused on include (Ahmed and Sánchez-Triana 2008; Loayza priority environmental concerns for sustainable, et al. 2011): poverty-reducing development; the Pakistan SEPSA, which integrated an explicit poverty ■■ Identifying environmental priorities for poverty component and economic impact analyses and alleviation and analysis of the capacity of natural mitigation measures; and the Gujarat State resources and environmental services to support Highway impact-centered SEA, which among sector-wide economic activities and sector growth other things paved road shoulders to facilitate nonmotorized transport. ■■ Highlighting institutional and governance gaps or constraints affecting environmental and There is often an artificial distinction made social sustainability between social and environmental issues, which, while useful for some kinds or stages of analytical ■■ Promoting capacity building and institutional, work, should not dominate an SEA. Addressing legal, and regulatory adjustments critical for economic aspects and social and distributional/ environmental and social sustainability of poverty impacts related to the issue(s) at hand sector reform are inherent to good SEA. However, few impact- centered SEAs address economic aspects and ■■ Strengthening accountability on the social and distributional/poverty impacts. management of environmental and social risks through increasing transparency and empow- Factors conducive to the above benefits ering weaker stakeholders and overall SEA impact include SEA cham- pions in the Bank and counterpart teams, social learning processes ■■ Institutionalizing solid coordination with the client and broad- around the design and implementation of based participation from stakeholders and civil public policies. society, SEA preparation in time to provide World Bank SEA Experience in South Asia: From Impact-Centered to Policy Approaches 61 environmental-social-economic input into specific SEA’s success and level of influence. In the India instruments (such as policies and regional spatial CEA, the participation component was heavily transformation strategies), and commitment by emphasized, government entities and NGOs the Bank to longer-term engagement and follow- were engaged, environmental constituencies up of the SEA process. were strengthened, and civil society partners took forward the CEA’s recommendations even Robust methodologies, which are becoming before the report had been finalized. The task more proven, also are a factor in an SEA’s team leader said that although it took a great ultimate impact and level of influence. In this deal of time and effort to coordinate that level regard, CEAs and in general policy SEAs, which of participation, the results clearly justify seeking have increasingly better defined method- as much participation in the future. In retro- ological components in the Bank context, have spect, it is wished that the Dhaka SEA pilot had been shown to be highly effective in identifying addressed the participation element more effec- priority issues and implementing measures to tively. The Nepal Medium Hydropower SEA, address them. Palar Basin SBA, and Gujarat State Highways Project SEA all commendably integrated and Impact-centered SEAs tend to be less strategic prioritized public and community participation than policy SEAs and also less consistent in and response in the SEA process, to positive their results and influence. These are often done ends. Regional good practice regarding partici- primarily to meet international financial institu- pation continues in newer processes, such as the tions’ clearance requirements and to minimize West Bengal Sundarbans SEA. their “reputational risk.� After more than 20 years of practice, impact-centered SEAs continue Ownership matters. Although CEAs and policy to face issues with timing (initiated too late in and plan SEAs have high potential influence project or program preparation and/or not done due to their strategic reach and coverage, their in time) and report quality (weak analysis of influence is also determined by the amount of alternatives, insufficient highlighting of regional/ ownership and buy-in felt by the counterpart and sectoral issues, lack of structured recommen- other in-country partners. This is exemplified in dations). Few impact-centered SEAs serve to the India CEA, whose findings and recommenda- enhance environmental planning or open up tions were embraced and taken forward by both decision making to public scrutiny. the government counterparts and civil society partners. On the other hand, in the case of the The importance of the participation element Dhaka SEA, unlike some of the other pilots, the in SEA cannot be overemphasized. It has been client did not feel a sense of ownership or buy-in acknowledged since SEA’s early days that a and, as a result, its influence was limited (World good-quality SEA process is “participative� and Bank et al. 2011). As has been found by other “informs and involves interested and affected authors as well (Annandale and Brown 2012), the public and government bodies throughout the term “SEA� can be flexible; including words like decision making process; explicitly addresses “social� or “poverty� can promote ownership their inputs and concerns in documentation and and overcome perceptions of a sole emphasis decision making; and has clear, easily-under- on the natural environment. In some cases other stood information requirements and ensures challenges, in addition to lack of ownership, sufficient access to all relevant information� included greater time and cost investments than (IAIA 2002). The importance of participation, were initially budgeted for (India CEA and Nepal which is not always culturally encouraged in the Medium Hydropower SEA) and high turnover South Asian context, remains a common theme of senior government officials, which caused in the South Asian SEAs. In fact, participation fluctuating levels of commitment over time is often spoken about as a major factor in an (Bangladesh CEA). 62 Str ategic Environmental Assessment in the World Bank Carrying forward the lessons from past expe- funding. What might happen in a situation of riences is an important theme in SAR. Several scarcer funding or changing priorities of decision policy SEA task team leaders advised consid- makers within and outside the Bank? ering at the beginning whether the ministries of finance or of planning might also be strategic counterpart agencies, taking into account their Moving Forward convening power and degree of influence, which Some of the primary development objectives of is sometimes greater than that of traditional coun- the Region are to accelerate growth and improve terpart agencies. Implementing this advice, the living standards and income, particularly among counterparts for the 2007 Nepal CEA were the the poor. Due to increasing understanding of the National Planning Commission and the Ministry linkages between natural resource management, of Environment, Science, and Technology, with environmental quality, human health, and indus- collaboration from various concerned sector trial growth, addressing lagging environmental ministries and departments. Building on earlier performance and greening growth are also strategic basin assessment experience, new regional priorities for action. According to Bank lessons have been brought to bear in later basin estimates, environmental degradation costs are assessments, such as the value of technology anywhere from 5 percent to more than 10 percent and spatial modeling or the importance of scale of gross domestic product in India, Bangladesh, issues. The 2011 SBA of the National Ganga (or Nepal, and Pakistan. The largest share of these Ganges) River Basin Project was also able to build costs is associated with environmental health on earlier learning. It has already helped to inform impacts, which account for about 20 percent of future lending within the Bank in the hydropower the total burden of disease in the Region and are and water resources sectors, including regional comparable to malnutrition. Another challenge projects. Moreover, it helped improve awareness is that the Region is expected to face increased and technical understanding between the vulnerability to extreme climatic events, such as governments in Nepal and India (SAWI 2010). more-intense cyclones, floods, and drought. Sea level rise is another critical threat, particularly As can be observed from the case studies and for coastal India, the Maldives, Bangladesh, and this discussion, SEA has been productively used Sri Lanka. In light of the need to address such in a variety of sectors in South Asia, including issues to reach sustainable development goals, transport and tourism. CEAs have proved SAR priorities are promoting structural trans- valuable in addressing country-level environment- formations in economic sectors, reducing the development priorities. The case studies and costs of environmental degradation on human discussions demonstrate that learning is occurring health, reducing pollution from key sources, and over time and confidence in different methodol- increasing the resilience of ecosystems, infra- ogies is growing as greater experience with SEA structure, and highly vulnerable areas. is gained. This is particularly true within certain sectors and typologies of SEA (CEAs, policy As has been demonstrated through the case SEAs). This reality underscores the importance studies, SEA has a strong potential role in helping of periodic reflection and taking stock of SEA address pressing environmental, economic, and experience and lessons learned in the Region and social issues so that South Asia’s growth becomes Bank-wide. increasingly green, more competitive in regional and international markets, and conducive to The evident value of SEA findings and recom- improvement of living standards for urban and mendations to client countries also underscores rural populations along the income spectrum. the need to assess and ensure the ongoing Policy SEAs, particularly those that also unravel sustainability of carrying out SEAs, since they and illumine social issues and institutional bottle- are so often undertaken with significant grant necks, offer great potential for moving forward World Bank SEA Experience in South Asia: From Impact-Centered to Policy Approaches 63 and addressing the key priorities identified SEA’s required elements (including requirements above. As analyzed in this chapter, recent policy for regional and sectoral EAs),30 yet assessment SEAs in particular exhibit great sustainable devel- of cumulative effects and regional and global opment potential. Most notably, countries are impacts, for example, are increasingly being inter- becoming strong vested partners in the analytical preted as policy requirements for SEA. work and are taking forward the findings and recommendations on their own initiative, often The Regional Environment Sector was seen with new requests for Bank support or follow-up. as having a role in providing technical assis- This is occurring with respect to not only envi- tance to improve SEA management capacity ronment ministries but also ministries of industry in key regulatory agencies, including sectors and other productive sectors. that may benefit by doing SEAs, in leading the dialogue with countries to promote SEA as a stra- Recent developments may provide impetus to the tegic planning tool, and in discussing with and SEA agenda in SAR and all Bank Regions. These orienting their government counterparts and task include the SEA/SESA Community of Practice team leaders to the idea of integrating SEA as launched in November 2011, which is regularly a policy preparation tool and ensuring internal- meeting and sharing knowledge and good prac- ization of recommendations. tices to strengthen the impact of SEA in client countries, and the 2012 World Bank Environment Field staff opinions on how much to promote Strategy. The Strategy includes an action matrix SEA in their respective countries were mixed. commitment to strengthen capacity in strategic Several staff members said that until the quality environmental assessment and country envi- of environmental impact assessments improves ronmental analysis, which suggests continued in SAR countries, perhaps it was not a good high-level support and availability of material idea to “sell SEAs.� However, others were keen resources to promote capacity strengthening on to promote the SEA agenda in the Region. For SEA and CEA. example, in one of the countries with the fewest SEAs, a staff member said: “I have realized in our In closing, surveyed SAR field staff were asked [country] context that SEA, if properly managed to reflect on advancing the regional SEA agenda and prepared, is very helpful and will strengthen and the role of the Environment Department awareness and at the strategic and policy level; (Environment Anchor) and the Region’s envi- otherwise, other efforts like EIA will not be very ronment sector in enhancing SEA capacity. efficient.� A selection of comments from surveyed In terms of specific actions and directions to field staff is provided in Annex 5.2. take, they suggested helping countries develop their own SEA systems, promoting pilot SEAs of government programs and policies, raising awareness among decision makers of the benefits of SEAs, hosting trainings, supporting learning from each other in the Region, and sharing infor- mation and best practices. It was hoped that the Environment Anchor could do more on devel- oping SEA tools, offering training programs, and hosting learning visits of Bank environment specialists to update their skills on SEA. The Environment Department was also seen as needing to provide clarification on the prolifer- ation of SEA-related instruments and SEA’s core 30 OP 4.01 footnote 11 refers the reader to Environmental Sourcebook Updates on sectoral and regional EA, which date from 1993 and 1996 elements. Operational Policy 4.01 is silent on respectively and are non-binding and advisory in nature. 64 Str ategic Environmental Assessment in the World Bank References Adhikari, A. P., and R. B. Khadka. 1998. Strategic Environmental Assessment. Proceedings of the South and Southeast Asian Regional Training Workshop on Strategic Environmental Assessment. Jointly organized by AREAP, IUCN Nepal, and the Netherlands Commission for EIA, September 18–20, 1997. Kathmandu, Nepal. Ahmed, K., and E. 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World Bank SEA Experience in South Asia: From Impact-Centered to Policy Approaches 65 Annex 5.1: SEAs Undertaken in the South Asia Region SEA title Year* Country Sector Type Mining Sector — Sustainable Development of Natural Resources Project II 2012 Afghanistan Mining Policy SEA (ongoing) Bangladesh Country Environmental Analysis 2006 Bangladesh Country CEA Dhaka Metropolitan Development Plan 2007 Bangladesh Urban Policy SEA Coastal Embankment Improvement Project (ongoing) 2012 Bangladesh Coastal Zone Cumulative EA Bangladesh Sundarbans 2012 Bangladesh Regional Dev Policy SEA Urban Development Project 1999 Bhutan Urban Sectoral EA Haryana State Highway Upgrading Project (dropped) 1997 India Transport Sectoral EA Ecodevelopment Project 1998 India Conservation Sectoral EA Gujarat State Highway Project 1998 India Transport Sectoral EA Rajasthan State Highways Project 1998 India Transport Sectoral EA Integrated Watershed Development Project (Hills II) 1999 India Rural Dev. Regional EA Tamil Nadu Road Sector Project 1999 India Transport Sectoral EA Third National Highway Project 2000 India Transport EIA Rajasthan Water Sector Restructuring Project 2000 India Water Sectoral EA Mizoram State Road and Rural Development Project 2001 India Transport Sectoral EA Kerala State Transport Project, Road Component 2001 India Transport Sectoral EA Karnataka State Highways Improvement Project 2001 India Transport Sectoral EA Uttar Pradesh State Roads Project 2001 India Transport Sectoral EA Karnataka Watershed Development Project 2002 India Rural Dev. Regional EA Tamil Nadu Water Resources Consolidation Project – Palar Basin 2004 India Water SBA Rampur Hydropower Development 2006 India Energy Cumulative EA India Country Environmental Analysis 2007 India Country CEA Towards Sustainable Mineral-Intensive Growth in Orissa 2007 India Mining CEA Tamil Nadu Water Resources Consolidation Project – Cooum Basin 2009 India Water SBA Uttar Pradesh Water Sector Restructuring Project – Ghagra-Gomti Basin 2009 India Water SBA Vishnugad Pipalkoti Hydro Electric Project 2009 India Energy Cumulative EA National Ganga River Basin Project SBA 2011 India Water SBA National Dairy Support Project 2011 India Agriculture Cumulative EA West Bengal Sundarbans 2011 India Regional Dev Policy SEA National Ganga River Basin Project Strategic Environmental, Economic, and 2012 India Water Programmatic EIA Social Assessment Luhri Hydro Electric Project 2012 India Energy Cumulative EA Road Maintenance and Development 1999 Nepal Transport EIA Power Development Project 1999 Nepal Energy Sectoral EA Nepal Country Environmental Analysis 2007 Nepal Country CEA Nepal Hydropower Sector 2010 Nepal Energy Cumulative EA Kabeli ‘A’ Hydro Electric Project 2011 Nepal Energy Cumulative EA National Drainage Program Project 1993 Pakistan Agriculture Sectoral EA Highway Rehabilitation Project Sectoral Social and Environmental 2003 Pakistan Transport Sectoral SEA Assessment Balochistan Small Scale Irrigation Project 2005 Pakistan Agriculture Cumulative EA Pakistan Strategic Country Environmental Assessment 2006 Pakistan Country CEA Pakistan Strategic Environmental, Poverty and Social Assessment of Trade 2011 Pakistan Transport Policy SEA and Transport Sector Reforms Green Industrial Growth 2012 Pakistan Industry Policy SEA Water Sector Capacity Building and Advisory Services Project (in progress) 2012 Pakistan Water Cumulative EA *Year of publication or disclosure. Acronyms: CEA-country environmental analysis; EA-environmental assessment; EIA-environmental impact assessment; SBA-strategic basin assessment; SEA-strategic EA. Source: World Bank. 66 Str ategic Environmental Assessment in the World Bank Annex 5.2: Comments from Field Office Staff on Advancing the Regional SEA Agenda One of the biggest impediments to moving Since rural poor, especially in South Asia, are the regional SEA agenda forward is the lack dependent on the natural resource base for live- of awareness among key policy makers in the lihood and poverty alleviation, SEAs of regional regional countries of the advantages of strategic development projects will be effective in terms planning. Raising awareness with specific country of the Bank’s mission of poverty alleviation. SEA examples of the economic advantage of with- on sectoral programs or policy-based lending and without-SEA-based planning may trigger the may be good candidates for SEAs in this context. interest of key decision makers in the countries. But without client ownership, particularly to act on the findings of the SEA, effectiveness is Based on the limited experience of SEAs in South a question. Asia, there is little commitment of the countries to conform to the recommendations of the SEAs, so An integrated approach by streamlining both the incentives to do so would be beneficial. institution-centered and impact-centered SEA with the project activities can be most effective I think the future SEA agenda should be for ensuring sustainable environment in the addressing the policy, strategy levels, and insti- Bank’s mission of poverty alleviation. tutional issues. I think since the third world and particularly the SAR countries suffer from lack of [effective] policy formulation and policy imple- mentation, the Region should give priority to policy SEAs then to institutional SEAs and later to sector-level SEAs. In my view, institutional SEAs and sector SEAs will not be effective if the policy level is deficient. In many cases the environmental impact of devel- opment activities can’t be contained within the national boundaries. The issues such as natural resources management, water use, air pollution etc. can have transnational or regional dimen- sions. Regional SEA approach may help to integrate the principles of sustainable devel- opment in the policies and programs of the involved countries. Important issues for the regional SEA agenda include: (i) transboundary water management and hydropower poten- tials; (ii) transboundary air and water pollution management; (iii) management of shared natural resources, including ecological resources; (iv) regional impact of climate change; (v) regional impact due to coastal protection strategy; and (vi) flood risk management. World Bank SEA Experience in South Asia: From Impact-Centered to Policy Approaches 67 chapter 6 World Bank SEA Experience in Sub-Saharan Africa From Environmental Safeguarding to Informing Policy Dialogue Cary Anne Cadman31 Cape Mauritania Verde Mali Niger Senegal Burkina Chad Eritrea Faso Sudan Nigeria Guinea Benin Sierra Togo C.A.R. South Ethiopia Leone Cameroon Sudan Somalia Liberia Uganda Guinea-Bissau Congo The Gambia Rwanda Côte d'Ivoire Burundi Kenya Ghana D.R. of Tanzania Equatorial Guinea São Tomé and Congo Seychelles Príncipe Gabon Angola Comoros Zambia Malawi Mauritius Namibia Zimbabwe Botswana Madagascar South Mozambique Africa Swaziland Lesotho 31 Cary Anne Cadman is Senior Forestry Specialist in the World Bank’s Africa Region. The author acknowledges the invaluable support and timely inputs for preparation of this chapter from Edward Olowo-Okere, Alexandra Bezeredi, Fernando Loayza, Yves Prevost, Martin Fodor, Svetlana Khvostova, Nagaraja Rao Harshdeep, Pieter Waalewijn, Peter Nelson, Rob Verheem, and the emerging World Bank SEA Community of Practice. 68 Str ategic Environmental Assessment in the World Bank Introduction Bank-sponsored Regional Workshop: Strategic Environmental Assessment in Africa: Challenges Strategic environmental assessments (SEAs) and Opportunities, at which the Sierra Leone have been used in Bank-financed operations Minerals Sector SEA and the Kenya Forests Act as an environmental assessment and devel- SEA were presented. At the 29th International opment planning tool in core growth sectors Association for Impact Assessment (IAIA) Annual in the Africa Region for over a decade. The use Conference, held in Ghana in 2009, the Bank of SEA as a strategic planning tool reflects the presented a session on Promoting Human Well- shift in the Bank’s development assistance from Being through Mining in West Africa: The Role providing technical solutions to strengthening of SEA . The session focused on how strategic country capacity for formulating and imple- environmental and social assessment contributes menting sustainable development policies and to achieving the triple bottom line from minerals plans (World Bank 2007). Earlier, the focus of the sector development. Bank’s support was on economic growth, with the environment being considered a constraint, an Building on these earlier reviews, this chapter add-on, or a donor-driven agenda. The current takes stock of the Bank’s experience in applying focus supports country-owned sustainable devel- SEA in Bank-financed operations in Sub-Saharan opment and considers environment as part of Africa between 1999 and 2012. In essence, it the development agenda with broad support examines whether the SEA work in AFR since for country systems, programs, and reforms. As 1999 has, in fact, reflected this shift in focus in the a result, the scope of environmental tools has Bank’s development assistance or whether a more expanded from project assessment to upstream concerted effort is needed to ensure full adoption analyses of strategic development priorities. of SEA as an effective assessment tool to support the Bank’s sustainable development objectives. Previous reviews of SEA experience in Bank- financed operations examined the impact and This stocktaking exercise assessed the experience lessons from the use of different environmental and lessons learned related to the growing body assessment (EA) instruments (country environ- of SEA work in AFR along two dimensions: the mental analyses (CEA), environmental impact evolution of SEA in the Africa Region (elements of assessments, and sectoral environmental an effective SEA, design and use of SEA, and the assessments) 32 in Sub-Saharan Africa (AFR).33 main drivers of SEA) and key lessons learned. Several reviews called for a more concerted application of SEA in Bank-financed opera- The chapter also presents an overview of tions and, in particular, in the minerals sector. emerging trends in the use of SEA as a catalytic More recent analyses of the effectiveness of tool in spatial planning and climate resilience SEAs in Sub-Saharan Africa include the 2008 operations in the Region. It closes with recom- mendations for the Environment Department 32 For the purpose of this review, SEA is broadly defined to include the following instruments, among others: strategic environmental and the Region to promote effective use of SEA assessment, regional environmental assessment, sectoral envi- across core growth sectors in AFR. ronmental assessment, rapid strategic environmental assessment, transboundary diagnostic analysis, strategic environmental and social impact assessment, strategic environmental and social assessment, and country environmental analysis. 33 These reviews included, among others: World Bank 1998; Kjörven Evolution of SEA in and Lindhjem 2002; the Bank-sponsored workshop on SEA on policy and planning process, Kilwa District, Tanzania, 2003; a Bank Sub-Saharan Africa review of the Burundi, Rwanda, and Western Tanzania (Nile Basin) SSEA of Power Development Options Stage I and II, 2003 and 2004; WWF 2005; World Bank, Safeguard Policies and Mining TA Review, Between 1999 and early 2012, the review iden- which examined the SEA experience in the Mauritania Mining Sector Capacity Building TA Project; and World Bank et al. 2011. tified 55 SEAs in 26 countries, including 7 World Bank SEA Experience in Sub-Sahar an Africa: From Environmental Safeguarding to Informing Policy Dialogue 69 Regional SEAs (see Annex 5.1). Prior to 2007, taken when considering and carrying out sector however, just 9 SEAs were prepared in AFR. reforms. For example, the Lake Victoria Regional Transboundary Diagnostic Analysis and Strategic With the onset and proliferation of the use of Action Program (TDA/SAP) was used to provide CEAs to inform Bank dialogue and the pipeline information for a program and strategy. The East portfolio in 2007, use of SEAs in Bank-financed African Community recognized at the time that projects increased measurably, with the vast there were shortcomings with the regional TDA majority of SEA work (32 of the 55 identified and SAP. In spite of these limitations, they were SEAs) conducted in the last three years (12 in considered valuable tools and deemed to have 2010, 11 in 2011, and 9 thus far in the pipeline influenced the final design of the Lake Victoria for 2012). SEA was most frequently used in the Environmental Management Project Phase II. minerals sector, with up to 13 SEAs used to Another good example of how information inform projects that support sector reform. coupled with consultations and policy dialogue in an SEA can catalyze subsequent development Elements of an Effective SEA in a sector is the Rapid I-SESA for the Malawi Minerals Sector Review (World Bank 2009). The Analyzing the Region’s SEA experience to date initial investment with the Minerals Sector Review against the three main elements that constitute led to development of a mining technical assis- a robust SEA— information, dialogue, and tance (TA) project with a full-fledged SEA specifi- influence (OECD-DAC 2006)—it was noted that cally designed to inform strategic planning in the all of the SEAs provided information and data sector over the long term. on environmental and social issues related to the sector, project, or program. However, an effective An effective SEA also supports ongoing and SEA provides information that ensures the avail- participatory dialogue among interested stake- ability of the assessment results early enough to holders. The review found that SEAs that were influence the decision-making process and guide designed as institutional or policy SEAs, and that future planning. It provides sufficient information included policy recommendations, were the most on the potential environmental and social effects effective in generating dialogue with government of implementing a strategic decision to judge and other stakeholders about gaps in the legal whether this decision should be amended and to and regulatory framework and opportunities for provide a basis for future decisions. policy reform and refinement. As most of the early SEAs, and some of the more Important examples of such SEAs include the recent ones, were not designed to influence Kenya Forests Act SEA that raised awareness decision making or guide future planning in the of the need for interministerial collaboration sector per se, the data they provided can be and facilitated understanding of the new forest considered useful but largely limited to descriptive users rights in enhanced forest management baseline information. An important exception by rural communities. Another example of are the SEAs for basin management projects and an effective SEA with respect to supporting programs that have been acknowledged as a dialogue is the West Africa Minerals Sector valuable decision-making tool and integrated into Strategic Environmental Assessment that estab- strategic basin planning efforts (Hirji et al. 2007). lished a multistakeholder policy dialogue at the community, national, and regional levels Earlier reviews found that SEAs can catalyze shifts (World Bank 2010). By emphasizing environ- in decision making and planning. Several SEAs mental considerations such as preserving the illustrate how strategic analyses can broaden integrity of the Upper Guinea Forest and social the views of decision makers. This, in turn, lays considerations such as increasing the trans- the foundation for changes in the approach parency in access to land for mining activities 70 Str ategic Environmental Assessment in the World Bank through regional regulations, this SEA was able notably in the minerals sector, the bulk of SEA to create support for a regional approach to work has been and remains supply-driven mining development in the Manu River Union by the Bank in order to comply with its safe- (World Bank et al. 2011). guard policies, in particular with OP 4.01 on Environmental Assessment. Another important example is the 2000 SEA for the Kihansi Area Conservation Plan that was The early SEAs were designed and used in a deemed best practice in Tanzania as it helped to fashion quite similar to the way environmental generate methodologies suitable for local-level and social management frameworks (ESMFs) are conservation action. One important outcome used today. That is, several SEAs were specifically of this SEA was its contribution in enhancing designed to assess the potential environmental community participation in decision making and and social impacts of a project whose investment involvement in planning the conservation area. activities were not fully defined or identified by This SEA has also been used in decision making appraisal and yet the potential adverse impacts by the Tanzania Electric Supply Company Limited. of proposed investments were deemed likely. In order to comply with the requirements of OP In addition, the 2011 Uganda CEA has also 4.01, the Borrower was advised to prepare an SEA successfully supported continuous dialogue to identify and assess significant potential project with the government on priority interventions impacts and the associated mitigation measures to improve governance in environment and that would be adopted for each subproject that natural resources management and to enhance might generate such impacts. productivity of natural resources in priority sites to deliver socioeconomic and environmental For example, the 1999 Ghana Micro, Small, benefits to local communities. The CEA has most and Medium Enterprise Project for the Tema recently informed the design of the proposed export processing zone used SEA as the proj- Bank-financed Sustainable Natural Resources ect’s EA tool. SEA was selected as the EA tool Management for Growth Project proposed for based on the fact that the onsite investments FY14 (M. Fodor, personal communication). were not known or fully defined at appraisal and involved a number of diverse investments such Finally, an effective SEA will influence decision as on-site processing facilities, factory buildings, making and policy formulation by raising commercial centers, security, and off-site infra- awareness and changing attitudes toward structure such as access roads, electricity, water, sustainable development (World Bank et al. 2011). and drainage that would have adverse environ- Only a few of the SEAs reviewed exhibited this mental impacts. This SEA was designed and quality. The West Africa Minerals Sector Strategic functioned as an ESMF and did not include a Assessment is one example as it clarified the strategic assessment of the interlinkages between link of regional harmonization of national mining economic, environmental, and social concerns; of policies with enhanced governance of the sector. the cumulative impacts and the legal and policy Another example is the Lake Victoria Regional TDA framework; or of the potential benefits and alter- and SAP, which was successful in illustrating how natives of specific project interventions. to integrate environment into decision making with respect to natural resources management. A second example is the 2003 Southern Africa Regional Gas Project (Mozambique and South Design and Use of SEA in Africa Africa) that carried out a regional environmental assessment to meet financing requirements in The review found that although use of SEA accordance with the Bank’s safeguard recom- to inform Bank-financed operations and mendations. The project involved the extraction, policy dialogue has matured since 1999, most transfer, and use of natural gas and required a World Bank SEA Experience in Sub-Sahar an Africa: From Environmental Safeguarding to Informing Policy Dialogue 71 range of activities, including exploration, devel- and institutional considerations of the act into opment of gas extraction and processing facilities its implementation. The purpose of the SEA was in the gas fields, and establishment of a pipeline. to inform, influence, and strengthen the process The environmental and social assessments of implementing the new Forests Act and policy prepared for the project were considered to be discussions regarding sustainable use of forest of high quality, with most of the documentation resources for national development. Today, Kenya consistent with the Bank’s safeguard policies is one country that has formally incorporated use and procedures. However, the Bank advised the of SEA in its legislation and actively applies SEA client that in order to fully comply with safeguard to inform policy reform and development plans, requirements, a regional environmental and social projects, and programs independent of donor assessment was needed. partner requests or financing requirements. Other countries where government is the driver of SEA In 2005, the Kenya Education Sector Support include Mozambique (Lower Zambezi Coastal Program SEA provided an assessment of the envi- Project) and Namibia (Uranium Mining). ronmental and social issues it raised. This SEA was prepared to comply with Bank safeguard require- Although the SEA for the Mauritania Minerals ments. And the “strategic� element referred to the Sector Project was required in order to comply fact that, as the investments had not yet been fully with Bank safeguard policies, it was struc- designed at appraisal, there was a need to assess tured to provide information for the definition the potential social and environmental impacts of an appropriate legal, regulatory, and insti- that the program’s investments might have and tutional framework for sustainable devel- provide guidance on how best to mitigate these opment of the hydrocarbon sector. The SEA impacts. Again, this illustrates how SEA was was developed in close consultation with all applied in practice in Bank-financed operations stakeholders including the oil industry, nongov- and how it functioned more as an ESMF than as a ernmental organizations working on environ- strategic development planning tool or platform mental protection and social development, for productive policy dialogue aimed at ensuring government agencies, and local government. sustainable and equitable development. International institutions and organizations such as the International Union for Conservation A main lesson learned from the Eastern Nile Joint of Nature, the German and Norwegian devel- Multipurpose Program (JMP) I SEA (begun in opment agencies, and the United Nations 2009 and ongoing) was that the objective of the Development Programme also provided assis- SEA should be strategic, not just technical, as was tance in preparation of the SEA. This SEA illus- the case of several early SEAs, and that the SEA trates well the shift in rationale and design of instrument must be tailored to the specific circum- SEA from a basic safeguard policy compliance stances of each country. This review found that the tool to a strategic planning instrument early SEAs did not involve strategic or participatory designed to inform sector growth and ensure planning as defined today and in use in current sustainable and equitable results. SEAs. Indeed, it was only with the 2005 Kenya Forest SEA and 2006 SESA for the Mauritania: The World Bank SEA Pilot Program also influ- Second Mining Sector Capacity Building Additional enced the evolution of SEA in AFR. The Financing Project that there was a clear shift in how program was designed to develop and test SEAs were designed and applied in practice. policy SEA approaches (World Bank et al. 2011). Beginning in 2005, the pilot program included In 2005, the government of Kenya ratified a three mining SEAs (Malawi, Sierra Leone, and new Forests Act. The Kenya Forest Strategic West Africa) and a forestry SEA (Kenya) in AFR. Environmental Assessment focused on inte- All of them illustrate the shift in focus in using grating the environmental, social, economic, SEA to support sustainable development rather 72 Str ategic Environmental Assessment in the World Bank than as a compliance tool to attend to World government can take to foster environmentally Bank safeguard requirements. sustainable and socially equitable development of the sector. Today, all Bank-financed mining It is clear that extractive industries play a critical operations in AFR incorporate SEA as a strategic role in economic growth and poverty alle- planning tool, as noted in Annex 5.1. viation in AFR and that they involve complex governance challenges. The social and environ- Finally, another good example of the post-2007 mental risks associated with extractive indus- shift in the use of SEA to examine the context tries have to be identified and addressed in a and sector policies applicable to specific invest- participatory manner. The Bank’s approach to ments and to move away from simply identi- working with governments on mineral sector fying potential adverse impacts and appropriate development has evolved to emphasize a holistic mitigation measures is the 2008 Sector EA for approach to mineral policy formulation linked the Democratic Republic of Congo: Multimodal directly to positive development outcomes, Transport Project. This Sector EA examined the an inclusive approach that depends on stake- environmental context applicable to the transport holder engagement to obtain legitimacy, a long- sector as a whole, environmental and social term view that emphasizes building strong and management plans (ESMPs) for specific activities accountable government institutions, and the of the project, and environmental policies to right balance between creating a positive envi- guide implementation of the subsector ESMPs. ronment for mineral investment and making sure that tangible benefits reach people. Overall, the review found that few of the pre-2007 SEAs were effective in influencing In this context, the mining pilot SEAs have been tangible change over the long term due to weak applied with varying degrees of success as a ownership, capacity and resource constraints, strategic sector planning tool to identify key and the challenge of sustaining dialogue and environmental and social priorities and cross- stakeholder engagement in implementing sector linkages as well as existing institutional, SEA recommendations once the SEA process policy, and governance capacity gaps to address was completed. such priorities. Even though the emphasis is on promoting open policy dialogue with multiple Main Drivers of SEA in Africa stakeholders, these pilots showed that addressing institutional and governance constraints is far As indicated previously, the review found that from straightforward. A major challenge is the after more than a decade of applying SEA across political economy of reform. In addition, support core growth sectors, the main driver of Bank- for multistakeholder dialogue needs to continue financed SEAs in Sub-Saharan Africa remains the after the formal SEA report is complete, as envi- World Bank for the primary purpose of complying ronmental and social institutional and governance with OP 4.01. However, after 2007 it is also clear change takes time to materialize (Loayza and that the use of SEA to inform policy dialogue Albarracin-Jordan 2010). between the Bank and client countries and to influence strategic planning and policy formu- Building on these pilots, a new generation lation has increased. The minerals, forestry, and of mining TA projects has been prepared for water sectors are leading this new trend in AFR. Cameroon, the Democratic Republic of Congo, Malawi, and Mozambique. All these projects In the minerals sector, the use of policy SEA follow the same methodology of preparing a reaches all technical assistance projects. In full SEA as a discrete project activity, not just as forestry, the use of SEA has been fostered by a project safeguard instrument. Their primary the REDD+ readiness process that integrates objective is to identify priority actions that policy SEA and compliance with the World Bank’s World Bank SEA Experience in Sub-Sahar an Africa: From Environmental Safeguarding to Informing Policy Dialogue 73 environmental and social safeguards policies. government buy-in, as the SEA was not funded Finally, the use of SEA as a strategic planning directly by government. Trust was central to the and policy formulation tool is embedded in initiation of the Eastern Nile JMP and Shire Basin Bank-financed basin management projects and SEAs. In both cases, the government was initially programs such as the Eastern Nile JMP and Shire skeptical, with key institutions becoming strong Basin Management Program. supporters of the SEA process once trust was established. The Eastern Nile JMP SEA showed that sufficient time and effort must be allocated Key Lessons Learned in the to foster greater understanding and ownership of Use of SEA in the Africa Region the SEA and the SEA process by all stakeholders. The Rapid Integrated SEA for Malawi Minerals The review found that five main factors either Sector Review was successful in bringing attention enabled or hindered achievement of SEA objec- to environmental priorities and contributed to tives: country ownership, timing, stakeholder moving environmental and social issues up the engagement, capacity constraints, and the legal reform agenda once trust had been established. basis for such assessments. Timing Country Ownership The review found that the timing of the SEA had The main factor affecting the outcome of an an impact on the ability of the SEA to achieve its SEA was found to be government ownership objectives. Timing in terms of status of sector policy of the SEA instrument and process. Country dialogue, government development plans, national ownership of the SEA was deemed limited in strategic planning cycle, pipeline investments, most instances, as the SEA exercise was supply- and parallel investments in a sector or in the same driven by the Bank in order to comply with its physical area should not be underestimated. The safeguard policies. Often it involved interna- minerals sector SEAs of the Pilot Program found tional consultants who designed and carried out that factors that affected the efficacy and success the work without building local capacity on SEA of SEAs included timing, as often SEA was used too work. At present, SEA may still be considered a late in the process to make a tangible difference fairly new EA tool in AFR, given the general level (World Bank et al. 2011). The Malawi Rapid of awareness and knowledge as to why, how, and Integrated SEA for the Minerals Sector Review, when to use it. however, was timely and informed the process of developing new mining sector policy and legis- Application of SEA in certain sectors (such as lation. The Lake Victoria TDA and SAP experienced mining and forestry) is more advanced than in significant delays that impaired their influence on others in terms of informing strategic planning and the design of the second phase of the adjustable decision-making processes. However, in sectors program loan. Approaching and designing the such as agriculture, education, and energy, SEA SEA with relative timing in mind is crucial to ensure has not yet been shown to have generated signif- successful outcomes. icant influence in terms of guiding sector-specific decisions on either policy or institutional reform. Stakeholder Engagement Trust is an important element of country Dedicated public participation was integrated into ownership. Trust between government agencies the Lake Victoria, Eastern Nile JMP, Shire Basin, or between the government and the devel- Sierra Leone mining, Malawi Minerals Sector opment partner is a critical component when the Review, and West Africa Mineral Sector Strategic government has limited experience with SEA. All Assessment SEA processes through focus group policy SEA pilots in AFR had difficulty securing discussions, community surveys, and regional, 74 Str ategic Environmental Assessment in the World Bank national, and provincial workshops. A lesson mandating use of SEA in development operations. learned from all of these is that SEA is not an event By formalizing use of SEA at the national level, but a process and that decisions will not necessarily these countries have strengthened government be taken on the basis of the SEA report but rather ownership of SEA as an essential development on the process. For example, the Malawi Shire Basin planning tool. In countries where no such legis- SEA established an ongoing process and policy lation exists, SEA tends to remain a donor-driven dialogue with government throughout the life of exercise with limited influence. Once the SEA is the 12-year basin management program. Although completed, it is difficult to sustain in terms of the the SEA was used to inform program and project medium- and long-term recommendations that design, including the project’s safeguard docu- underpin sustainable and equitable development ments, it was not in and of itself a requirement to in a particular sector or sectors. comply with OP 4.01. It was found to be effective in engaging several key stakeholders central to fostering collaboration on a joint set of objectives Future Trends: New Applications with respect to planning and ensuring sustainable of SEA in Africa development of the Shire Basin. In the last three years, it has become evident that The Malawi Minerals Sector Review SEA, in SEA continues to be adopted as a regular EA tool particular, was found to strengthen constitu- to comply with OP 4.01 across the Region, but encies. The stakeholder workshop encouraged there is a shift toward using SEAs as a strategic weaker stakeholders to claim stakes in the sector development planning tool. Interestingly, this reform process. The SEA also improved social shift is not linear. In two emerging instances SEA accountability. Efforts to collect and share infor- is being used both to comply with Bank safeguard mation on key environmental and social concerns policies and to attend to a series of complex stra- were limited but relevant to strengthen account- tegic development planning issues that are at the ability against a backdrop of mistrust. forefront of the Bank’s development assistance in Africa. It is important to highlight these cases Capacity Constraints because they represent a well-balanced approach to applying SEA in a Region where using SEA A major limitation of effective SEA work across the to meet safeguard requirements remains an Region was found to be a lack of local capacity essential aspect of operational work. to develop and prepare the assessments. In the majority of SEAs reviewed, international consul- The first case is the Spatial Development tants or consultancy firms (such as Environmental Technical Assistance Project that came online in Resources Management) were retained to conduct Mozambique to help the government undertake the SEA. One exception was the Lake Victoria a set of studies to support spatial development Regional TDA and SAP, which demonstrated the planning, including studies on “development benefits of working with national EA practitioners. corridors.� With this approach, the government The SAP was developed by international consul- aims to strengthen sustainable institutional tants. However, they drew on the five national capacity on spatial development planning and TDAs, each of which was developed by national elaborate robust proposals for spatial devel- intersectoral tasks forces consisting of staff from opment initiatives (SDIs). The SDI methodology different sector ministries. aims to unleash the economic potential of a given geographic zone (a “development corridor�) in a Legal Basis for SEA sustainable manner. An integral part of this work is the preparation of upstream impact and policy A number of countries in AFR (Kenya, South Africa, SEAs to inform development priorities along and Namibia) have incorporated formal legislation each of the growth poles identified. The SEAs World Bank SEA Experience in Sub-Sahar an Africa: From Environmental Safeguarding to Informing Policy Dialogue 75 will incorporate environmental and social consid- establish a continuous dialogue and functional erations in the implementation of the project to platform upon which strategic decision making promote environmentally sustainable and socially can occur. equitable development through the proposed SDI. The approach adopted is to develop a set Two regional priorities for action and of two-tiered SEAs: at the national level, with a recommendations for addressing these gaps focus on country systems and capacity for incor- and moving the SEA agenda forward in Africa porating environmental and social considerations at this juncture are: in spatial development planning, and at the SDI level, for applying SEA in the preparation of the ■■ Strengthening outreach efforts to increase six development corridors that the project will awareness about SEA as an effective tool to support. The SEA process will be conducted in a foster sustainable and equitable development participatory manner. ■■ Facilitatingknowledge transfer and technical The second case of applying SEA in innovative skills development on the use of SEAs among ways in the Region is the Pilot Program for local EA practitioners in the Region. Climate Resilience–PPCR (Mozambique, Niger, and Zambia). The program is designed to pilot A third priority, internal to the Bank, is to maintain and demonstrate ways to integrate climate risk and strengthen efforts to facilitate and promote and resilience into developing countries’ core the paradigm shift away from using SEA as a development planning. The pilot programs safeguards compliance tool only. Although SEA implemented under the PPCR are country- may still be used as an instrument to comply led, build on National Adaptation Programs of with OP 4.01, which remains essential in many Action, and are strategically aligned with the instances, efforts to promote the use of SEA as Adaptation Fund and other donor-funded activ- a development planning instrument are equally ities to provide pilot finance in the short term so important. Only in this way will SEA be driven by that lessons will be learned in designing scaled- government, which is needed for increasing SEA up adaptation financing. More specifically, as a ownership, sustained investment in applying SEA complement to adaptation financing, the PPCR recommendations, and maintaining stakeholder finances programmatic approaches to upstream engagement in the SEA process. climate resilience in development planning, core development policies, and strategies. The To realize these priorities, a three-pronged potential social and environmental issues and approach is recommended: impacts involved in mainstreaming climate resil- ience into economic planning will be assessed ■■ Development of a dedicated outreach and through the SEA. awareness raising program on the long-term economic, environmental, and social benefits of applying SEA to inform policy and strategic Moving Forward: Developing development planning and investment by the a Structured Approach to public and private sector. Mainstreaming SEA in Africa ■■ Development of a comprehensive capacity From this stocktaking exercise, it is clear that the building program to strengthen local and most critical gaps in ensuring effective design regional capacity of environmental assessment and appropriate application of SEA as a strategic and sector practitioners in the design and use development planning tool in the Africa Region of SEAs across core growth sectors. Current remain greater awareness and deeper knowledge work led by the Region in partnership with the of why, when, and how to use SEA and how to Netherlands Commission for Environmental 76 Str ategic Environmental Assessment in the World Bank Assessment and the IAIA and its affiliates in requirements only; carry out an in-depth review Africa is the provision of targeted training work- of the institutional framework for application shops on effective use of EA tools, including of SEA at the national and regional levels. This SEA. Another effort led by the Africa Region review will ascertain what factors need to be is the recent launch of a set of Institutional put in place to permit the shift toward country- Development Fund Grant Programs (Kenya, driven use of SEAs that ensure full ownership, Senegal, and Uganda) designed to strengthen continuous participatory engagement, appro- country systems on environmental and social priate timing, and possibly a formal legal and assessment. These programs provide recipient- regulatory environment that calls for use of SEA executed funds to national agencies tasked with when appropriate. supporting environmental and social assessment and management work at the national level. All three actions can and should be rolled The two-year programs aim to strengthen the out in close collaboration with the existing assessment, enforcement, and monitoring and Environmental Assessment Nodes Network in evaluation capacities of national EA practitioners Africa and with development partners active in in the use of each country’s environmental and supporting country-driven use of SEAs in AFR. social management systems, including the full range of EA tools such as SEA. This work will be With respect to internal needs, the Environment scaled up to Ethiopia, Nigeria, and Tanzania in Anchor and the Region could provide support FY13, and additional sources of funding should through just-in-time direct operational support to be allocated to further expand this effort and task teams and clients preparing and conducting similar efforts to build country capacity to prior- SEA work by World Bank SEA experts joining itize use of SEA in planning processes. project teams and through targeted hands-on training on lessons learned, practical experience, ■■ Strengthenand support the paradigm shift and best practices in the design and use of SEA. away from tieing SEA to safeguard compliance References Hirji, R., R. Davis, K. Mfalilia, M. Wishart, F. Loayza, and B. Livernash. 2007. Strategic Environmental Assessment and Integrated Water Resources Management and Development. Washington, DC: World Bank. Kjörven, O., and H. Lindhjem. 2002. Strategic Environmental Assessment in World Bank Operations: Experience to Date – Future Potential. Strategy Series No. 4. Washington, DC: World Bank. Loayza, F., and J. Albarracin-Jordan. 2010. Mining Sector Strategic Environmental and Social Assessment (SESA) . Environment Notes No. 4. Washington, DC: World Bank. OECD-DAC (Organisation for Economic Co-operation and Development–Development Assistance Committee). 2006. Applying Strategic Environmental Assessment: Good Practice Guidance for Development Cooperation. Paris. World Bank. 1998. EA Sourcebook. Update No. 22, EA of Mining Projects. Washington, DC. ———. 2007. Strategic Environmental Assessment Toolkit. Washington, DC. ———. 2009. Malawi Mineral Sector Review. Source of Economic Growth and Development. Report No. 50160-MW. Washington, DC. ———. 2010. West Africa Mineral Sector Strategic Assessment (WAMSSA). An Environmental and Social Strategic Assessment of the Mineral Sector in the Mano River Union. Report No. 53738-AFR. Washington, DC. World Bank, University of Gothenburg, Swedish University of Agricultural Sciences, and Netherlands Commission for Environmental Assessment. 2011. Strategic Environmental Assessment in Policy and Sector Reform: Conceptual Model and Operational Guidance. Washington, DC: World Bank. WWF–UK. 2005. Where Are All the SEAs? Project Finance and Strategic Environmental Assessment of Major Oil and Gas Developments. Godalming, Surrey, U.K. World Bank SEA Experience in Sub-Sahar an Africa: From Environmental Safeguarding to Informing Policy Dialogue 77 Annex 6.1: SEAs Completed, Ongoing, and in the Pipeline in Sub-Saharan Africa, 1999–early 2012 # SEA title Year Country Sector Type 1 Micro, Small, and Medium Enterprise Project: strategic envi- 1999 Ghana Private Sector SEA ronmental assessment for the export processing zone, Tema 2 Kihansi Area Conservation Plan 2000 Tanzania NRM SEA 3 Tanzania Kihansi Area Conservation Plan 2000 Tanzania NRM SEA 4 Manantali Energy Project 2000 Regional Energy Mali, Senegal, and Mauritania Hydropower SEA 5 Sustainable Coastal Livelihoods Technical Assistance 2003 Tanzania Fisheries SEA 6 Southern Africa Regional Gas Project 2003 Regional Minerals Sector Regional EA 7 Kenya - Education Sector Support Program Project 2005 Kenya Education SESIA 8 Madagascar - Irrigation and Watershed Management Project 2006 Madagascar Basin Regional ESA Management 9 Second Mining Sector Capacity Building Additional Financing 2006 Mauritania Minerals Sector SESA Project 10 CEA 2007 Ethiopia National CEA 11 Rapid CEA 2007 Ghana National Rapid CEA 12 Rapid CEA 2007 Nigeria National Rapid CEA 13 Natural Resources and Environmental Governance First, 2007 Ghana Forest and SEA Second and Third Development Policy Operations Natural Resources Management 14 Kenya Forests Act 2005 2007 Kenya Forestry I-SEA 15 CEA 2008 Namibia National CEA 16 CEA 2008 Senegal National CEA 17 Lake Victoria Environmental Management Project Phase II 2008 Rwanda Basin Trans-boundary Management Diagnostic Analysis and Strategic Action Program 18 Kribi Gas Power Project 2008 Cameroon Energy Regional EA 19 Congo, Democratic Republic of - Multi-modal Transport 2008 DRC Transport Sector EA Project 20 Sierra Leone Mining Sector Reform 2008 Sierra Leone Minerals Sector SESA 21 Eastern Nile First Joint Multipurpose Program 2009 Regional Basin Strategic Social management and Environmental Assessment 22 Nile Basin Initiative Institutional Strengthening Project 2009 Regional Basin Strategic Sector Social management and Environmental Assessment 23 Minerals Sector Review (Chapter 4) 2009 Malawi Minerals Sector Rapid Integrated SESA 24 CEA 2010 Benin National CEA 25 CEA 2010 Cote d’Ivoire National CEA 26 ProIRRI 2010 Mozambique Agriculture SEA 27 Shire River Basin Mgmt Project 2010 Malawi Basin SESA management 78 Str ategic Environmental Assessment in the World Bank # SEA title Year Country Sector Type 28 Pilot Program for Climate Resilience 2010 Mozambique Climate Change SESIA 29 Pilot Program for Climate Resilience 2010 Niger Climate Change SESIA 30 Pilot Program for Climate Resilience 2010 Zambia Climate Change SESA 31 Nile Equatorial Lakes Region 2010 Regional Energy Strategic Sector Social and Environmental SEA Parts I and II Assessment 32 Growth with Governance in the Minerals Sector Project 2010 DRC Minerals Sector SESA 33 Mining Sector Capacity Building Project, 2nd 2010 Mauritania Minerals Sector SESA 34 West Africa Minerals Sector Strategic Assessment 2010 Regional Minerals Sector SESA (Guinea, Liberia and Sierra Leone) 35 7th PRSC Stocktaking of Needs across Sectors for EIAs and 2010 Mozambique National SEA Needs Assessment SEAs 36 CEA 2011 Central National CEA African Republic 37 CEA 2011 Uganda National CEA 38 Market-led Smallholder Development in the Zambezi Valley 2011 Mozambique Agriculture SESA 39 National Irrigation Master Plan and the National Irrigation 2011 Tanzania Agriculture SESA Policy 40 Forestry and Economic Diversification Project 2011 Republic of Forestry SESA Congo 41 Mineral Development Support Project 2011 Burkina Faso Minerals Sector SESA 42 Mining Governance and Growth Support TA Project 2011 Malawi Minerals Sector SESA 43 Nigeria Power Sector Guarantees Project 2011 Nigeria Minerals Sector Sector EA 44 Enhancing Institutional Capacities on Reducing Emissions 2011 Regional Forestry and SESA from Deforestation and Forest Degradation (REDD) Issues for Climate Change Sustainable Forest Management in the Congo Basin Project 45 Cameroon Mining Sector Technical Assistance Project 2011 Cameroon Minerals Sector SESA 46 Strategic Environmental Assessment of Coffee Sector Reform 2011 Burundi Agriculture SEA in Burundi 47 CEA 2012* Madagascar National CEA 48 Tanzania Southern Agriculture Growth Corridor Project 2012 Tanzania Agriculture SESA 49 Liberia – FCPF REDD Readiness Preparation Support 2012 Liberia Forestry SESA 50 Tanzania Energy Sector Capacity Assistance Project 2012 Tanzania Minerals Sector Sector Impact SEA 51 Spatial Planning Technical Assistance Project 2012 Mozambique Infrastructure 7 SESAs 7 SESAs: 1 national, 6 sub-regional by economic corridor 52 Mega-Infrastructure Regional Development Project – 2012 Mozambique Energy and Regional Strategic Mozambique CESUL Transport Environmental and Social Assessment 53 Mozambique Mining Technical Assistance 2012 Mozambique Minerals Sector SEA 54 Private Sector Rehabilitation and Agribusiness Development 2012 Guinea- Private Sector SESA Project Bissau 55 Ghana - PPP Project 2012 Ghana Infrastructure SEA * draft under consultation Source: World Bank. World Bank SEA Experience in Sub-Sahar an Africa: From Environmental Safeguarding to Informing Policy Dialogue 79 chapter 7 World Bank SEA Experience in Latin America Caribbean and the From Environmental Safeguarding to Informing Policy Dialogue Francis Fragano34 The Bahamas Haiti Jamaica Dominican Rep. St. Kitts and Nevis Mexico Antigua and Barbuda Belize Dominica St. Lucia Guatemala Honduras Barbados El Salvador R.B. de St. Vincent and the Grenadines Venezuela Grenada Nicaragua Trinidad and Tobago Costa Rica Panama Guyana Colombia Ecuador Suriname Peru Brazil Bolivia Paraguay Chile Uruguay Argentina Falkland Islands (Islas Malvinas) A dispute concerning sovereignty over the islands exists between Argentina which claims this sovereignty and the U.K. which administers the islands. 34 Francis Fragano is Senior Environmental Specialist. The author acknowledges Yewande Awe, Fernando Loayza, and Glenn Morgan for their valuable guidance and inputs to early drafts of the chapter. Paula Posas, Juan Carlos Belausteguigoitia, Juan Quintero, and Raul Tolmos kindly contributed their perspective and knowledge of regional SEA and CEA efforts. 80 Str ategic Environmental Assessment in the World Bank Introduction and Methodology the 1970s, related to water basins such as the Pilcomayo River between Argentina, Bolivia, and This chapter provides a brief assessment of Paraguay—some of the earliest strategic envi- the World Bank–supported Latin America and ronmental assessment work in the Region. This Caribbean Region (LAC) experience in strategic may be why the water sector has naturally been environmental assessment (SEA) over the last a leader in the Region regarding SEA. At the decade and a half. Several studies have docu- broadest level of analysis, but within national mented the use of this instrument in the Region boundaries, country environmental analyses in different sectors and with different approaches (CEAs) can be very general or focus on specific (World Bank 2005; Hirji and Davis 2009; Kjörven issues linked to some development or gover- and Lindjhem 2002). This discussion, however, nance issues of concern. seeks to consider the history of SEA more broadly, the drivers for utilizing it, and future In the early 1990s, starting with the Operational and possible ways forward for the World Bank to Directive 4.01, regional environmental assess- continue supporting the mainstreaming of SEA in ments (REAs) and sectoral environmental assess- the Region. This assessment is based on a review ments (EAs) became part of the World Bank of SEA practice supported by the World Bank toolbox. Several projects undertook both REAs and on interviews with key staff who have worked and sectoral EAs, including the power sector in in the Region with this assessment method. Colombia, the water sector in Argentina, and the irrigation sector in Mexico. These instru- In regard to the methodology and practice ments were applied to projects with broad of SEA, there is a spectrum of instruments, geographic footprints and those with combina- approaches, and nomenclature.35 This character- tions of infrastructure and policy changes. Early istic is one of the most difficult aspects to grapple experiences with these particular tools began with when analyzing SEA practice. The flex- in the water sector at a moment when possibly ibility of the instrument that can look at impacts there was a strong emphasis on privatization from programs, policies, and plans is both its and major changes in concession systems for greatest strength and the greatest barrier to increasing potable water and sanitation services. widespread adoption. The flexible methodology Options needed to be assessed and planned generates some difficulty in defining the bound- for investments, while the policy aspects were aries (thematic, geographic, and temporal) of the generally considered in relation to the social, analysis, while on the positive side it can provide environmental, and financial sustainability of the a structured (and somewhat open) platform for proposed investments. dialogue and analysis of environmental and social impacts and the risks and benefits of devel- At the beginning of the new millennium, following opment processes. a review of EA in the World Bank (Green and Raphael 2001) and with a mandate from the 2001 Environment Strategy (World Bank 2001), the Evolution of SEA in Latin America use of SEA began to increase throughout the and the Caribbean Bank, including LAC. A review was also done in conjunction with the strategy that recommended SEA has a long history in LAC that goes back a pilot program of SEA for the Bank (Kjörven and to the planning processes supported by the Lindhjem 2002). Starting in 2005, a pilot program Organization of American States, starting in began primarily focused on the Africa Region, 35 See Chapter 1 for a brief description of these instruments along with some of their benefits and limitations. World Bank SEA Experience in L atin America and the Caribbean: Enhancing Infr astructure Developments and Sector Reforms 81 with only one pilot in Latin America.36 During the Table 7.1 Select SEAs in LAC second half of this decade, however, the Region did see a number of SEAs take place. Early phase (1997–2001) Impact-Centered Approaches Guatemala Private Participation in Infrastructure (1997) Argentina El Niño Emergency Flood Project (1998) The important SEAs carried out in LAC over the Water Sector Reform (1999) last decade included large-scale projects such Venezuela Power Sector Reform (2001) as the Bolivia-Brazil GASBOL pipeline, Lima Colombia Energy Policy SEA (1993) Urban Transport, Santiago Urban Transport, and Dominican Republic Water and Sanitation. Recent SEAs (2002–12) While these had some policy dimensions, they Argentina Calafate Tourism SEA (2006) were primarily impact-oriented, with strategic Mexico Modernization of Irrigation SEA alternative analysis that incorporated policy, Rio Apatlaco Watershed SEA economic, and social considerations into the decision-making process for the investment Michoacan Climate SEA (2010) program. This is consistent with the 2002 Bank Energy SEA SEA review in which most cases considered were Environment DPL (CEA) (2006) programmatic lending operations. These opera- Tourism (2005) tions included large transboundary infrastructure Colombia Water and Sanitation Sector SEA (2001) projects in LAC involving the Inter-American Peru Lima Urban Transport Development Bank (IDB) and the World Bank that helped advance SEA practice in the Region. Mining (2005) The approach in LAC has been an “ad-hoc� one, Honduras Tourism (2004) as described in the 2002 review, rather than the Dominican Water and Sanitation (2010) piloted approach that was suggested at that Republic time. Important efforts were made, however, to Bolivia-Brazil Gasbol pipeline advance the use of SEA in the Region, although Brazil Ceara – PROGERIRH Water (2002) this was not formally called a SEA “pilot� program Chile Santiago Transport SEA (see Table 7.1). Source : World Bank. Institution-Centered or Policy Approaches incorporated into Bank operations. Moreover, This approach to SEA was also piloted in the they were also linked to advances in the sector Region, in particular with the water sector, more broadly. In these early cases, it is likely building on the important groundwork in the that the discussions around privatization that area of integrated water resources management. advanced in the Region and the Millennium The SEA process was a very natural extension Development Goals stimulated analysis of the of this process (Hirji and Davis 2009). The cases potential structural changes needed in the water of Colombia and Argentina have been well and sanitation sector to increase coverage levels. documented (Sánchez-Triana and Enriquez The sustained programmatic efforts in both 2006; Hirji and Davis 2009), in which the policy Colombia and Argentina in the water sector options of various scenarios for the sector were provided the continuous platform for dialogue analyzed and led to recommendations that were around key policy issues and strategic options needed for SEA to be successful. 36 In 2010–11, the World Bank SEA Pilot Program supported the climate change plan for Campeche state (Mexico) and, partially, the climate change plan for Michoacán state (Mexico). These plans followed SEA Mexico has been a leader in advancing SEA in approaches in their preparation as a way of fully integrating SEA in the preparation of climate change plans. Latin America, covering many sectors through 82 Str ategic Environmental Assessment in the World Bank national and state-level processes, as can be which in the Latin America and Caribbean Region noted in Table 7.1. One of these cases was docu- saw a significant increase in use during the first mented by Loayza (2012) with regard to proposed decade of 2000 and continue to be an important reforms in the tourism sector around 2005. The lending instrument for the Bank (see Table 7.2). SEA process provided for policy-level interven- tions through the development of scenarios of tourism development in the country and the Table 7.2 Country Environmental potential impacts that these could generate. The Analysis process resulted in improved data collection in the sector, created institutional mechanisms for Prepared Ongoing coordination of policies, established the impor- Honduras (2009) Argentina tance of environmental quality for the provision Peru (2007) Ecuador of tourism services, and helped mainstream sustainability in the tourism sector and country Colombia (2006) outreach campaigns. El Salvador (rapid) (2006) Guatemala (rapid) (2006) More recently the Mexico program has focused Dominican Republic (rapid) (2004) systematically on climate change in many Nicaragua (2011) different dimensions. SEA processes have incor- Panama (2008) porated the social dimension within the design of Mexico’s national Reducing Emissions from Source : World Bank. Deforestation and Forest Degradation (REDD+) strategy through application of strategic envi- A number of these CEAs were developed ronmental and social assessment (SESA). At between 2004 and 2007 with the support of the state level in Michoacan and Campeche, a trust fund. The CEAs aimed at providing SEA approaches were applied in planning that analytical support to governments in devel- included consideration of adaptation costs and oping policies and programs to reduce environ- climate change alternative scenarios. This process mental degradation, improve natural resources has also been helped recently by a specific management, and seek links to human health memorandum with the country that sustains and economic growth strategies (see Box 7.1). the knowledge agenda and engagement with In Central America, trade aspects related to the country, including SEA-type activities (J. C. potential free trade agreements were considered Belausteguigoitia, personal communication). as well. The analysis also provided the Bank with an important platform for dialogue regarding the The movement from impact-centered SEA toward development of country partnership strategies. policy SEAs is also consistent with the experience in other regional programs of the World Bank, Current Status of SEA in LAC such as the South Asia Region.37 Although the practice has evolved, it is still difficult for prac- The SEA approach is not being systematically titioners to move from a project-oriented and adopted within a particular sector or country in impact and risk assessment focus to a national or the Region in the context of World Bank–financed sector-oriented and system assessment focus. projects. The incorporation is somewhat hetero- geneous in regard to the themes and levels. Country environmental analyses have also Table 7.3 lists some of the projects currently advanced with support from the World Bank in under preparation or implementation that have association with development policy loans (DPL), incorporated strategic environmental (and social, in some cases) assessment. Recurrent themes 37 See Chapter 5. include water and tourism followed by energy World Bank SEA Experience in L atin America and the Caribbean: Enhancing Infr astructure Developments and Sector Reforms 83 Box 7.1 Colombian Experience with Country Environmental Analysis In 2004 the Bank approved Development Policy Priority areas of reform were established and included in Operations as a new form of rapidly disbursing financing the 2006–10 National Development Plan. Mainstreaming to countries for budget support. This lending instrument of environmental aspects was a key objective of the seeks to support policy and institutional actions for devel- government of Colombia rather than the development opment, including achievement of environmental goals. of a separate environmental plan. Areas of focus for From 2005 through 2009, Colombia received support the DPLs included the National Environmental System from the World Bank for a series of development policy procedures and planning; water, solid waste, and air loans with the aim of supporting the government’s pollution legislation; key reforms in management of water sustainable development agenda, in particular advancing resources; national policies on environmental health; the achievement of the Millennium Development Goals. climate change; and monitoring and evaluation systems on environment. Technical assistance and investment The approach in the preparation of the series of DPLs was lending by the World Bank and by other partners such as to focus on systemic-level policy interventions that would the IDB and the Netherlands government were also linked aim at strengthening the National Environmental System. to the reforms. Priority areas were based on a solid analysis provided by the preparation in 2006 of the Colombia CEA. Some Currently the Colombia program of the World Bank important CEA findings included estimation of the cost of continues to build on this solid grounding established environmental pollution and degradation as 3.7 percent through the DPL series. Support has continued from the of gross domestic product and some 6,000 deaths from Global Environment Facility (GEF). Additional financing increased diseases linked to air and water pollution, espe- has been available through the Sustainable Development cially affecting children. In addition, the CEA identified Investment Project and other operations in urban and gaps or weaknesses in the institutional framework and rural regions of Colombia that range thematically from priority-setting process in the environmental sector that urban transport and water basin management and were disconnected from the investments and execution at regulation to carbon finance. the regional and local levels. Source : Based from World Bank 2010. Table 7.3 Current Planned or Ongoing and transport. Several projects in the Region, in SEAs with World Bank particular in Brazil recently, have incorporated Support in the LAC Region SEA as part of their activities. In Brazil, SEAs for Argentina - Biodiversity in Forestry Landscapes (GEF) the transport, mining, water, and energy sectors are currently being considered in the context - Sustainable Natural Resources Management of several operations. Notably, most of these - La Rioja SWAp – (water resources) efforts, with the exception of activities funded by the Global Environment Facility and the Forest Bolivia - Roads and Airport Transport Carbon Partnership Facility (FCPF), are supported Brazil - Federal Road Transport by the loans themselves. Hence, while there are - Energy and Mining TAL possibly fewer SEA efforts compared with other - Ceara State SEA Regions, they are substantially demand-driven Mexico, - SESA for the REDD+ readiness supported in nature. Colombia, Costa by FCPF program grants Rica, Nicaragua, El Salvador Climate change as a policy issue in the interna- Mexico - Tehuantepec Wind Power (GEF) tional arena is inherently strategic in nature, given the importance of modeling and trends toward Source : World Bank. 84 Str ategic Environmental Assessment in the World Bank future climate scenarios. Therefore, SEA has ■■ Theneed to consider the strategic options found an important role in the Region recently at of REDD+ within broader national climate national, subnational, and sector levels for climate change priorities change mainstreaming in decision making. ■■ The interinstitutional coordination required to Strategic environmental and social assessment deal with the many potential drivers of defores- is an SEA in which assessment of social issues tation (mining, forestry, agriculture, and energy, is emphasized. Applied in REDD+ readiness among others) processes for climate change mitigation, SESA is a growing area of SEA practice in ■■ Scalingthe SESA process at the national level in LAC. In particular, within the context of the very large countries FCPF supported by the World Bank and other delivery partners (IDB and United Nations ■■ Littleadvance in the Region in assessing and Development Programme), REDD+ readiness managing potential environmental impacts programs set the basis for reducing emissions outside the project areas (so-called leakage) from deforestation and forest degradation. into non-forested ecosystems or other coun- Countries become “ready� through forest tries, as the process of SESA for REDD+ has and other sector policy revisions, financial focused strongly on the social dimensions of mechanisms, and programmatic activities that these potential programs. would be developed and led by a national REDD+ strategy. Presently 15 countries in Latin Although the SESA process under REDD+ is America have been selected for the program, still in its early stages, the existing challenges although 3 of them (Mexico, Costa Rica, and do not seem insurmountable. There is a need Colombia) are more actively advanced with the for a more thorough dialogue on the strengths SESA process in the context of World Bank– and limitations of SESA for the design of REDD+ supported programs. programs. The instrument is providing an important platform for public participation in the The SESA process for REDD+ readiness is quite design of these programs as countries identify particular in that the program is environmentally stakeholders, organize workshops, and plan the focused, but there is concern regarding the REDD+ preparation strategies. However, there potential social and ancillary environmental is a danger that the SEA process is only seen impacts of a REDD program and associated as a platform for discussion and consensus, systems of payment for environmental services. while other beneficial aspects of the method- The Mexico, Colombia, and Costa Rica ology, such as assessment of risks and gaps for programs are advancing in developing their enhanced social and environmental management, REDD+ strategies and have already engaged might be weakened. in stakeholder identification and national-level consultation (subnational in Colombia) for Main Drivers and Limitations of SEA scoping out the principal issues for strategic analysis. Some of the challenges noted based on Legal Basis for SEA the early experience include: There is no strong legal driver for SEA in the ■■ Limitedcapacity to apply the SESA meth- Region since few countries have considered SEA odology in the context of REDD+ national in their legislation as a requirement for policy strategies, especially considering that the changes or establishment of large-scale infra- safeguards management of these types of structure. Countries with legislation on SEA programs is still under discussion within the in the LAC region include Chile, Dominican U.N. climate convention negotiations Republic, Panama, Guatemala, Colombia, and World Bank SEA Experience in L atin America and the Caribbean: Enhancing Infr astructure Developments and Sector Reforms 85 more recently Peru. The development banks, frameworks are working best in the Region including the IDB, have supported much of the and worldwide. work in addition to other bilateral and multi- lateral development partners. Clear evidence Economic Growth and Regional Integration of the lack of mainstreaming is seen in most guidance documents on SEA developed for the Policy-based SEA in the Region is carried out Region, which primarily reference the European primarily in the context of infrastructure devel- Union directive in regard to SEA methodological opment initiatives, although there are some approaches (IIRSA 2009; Herrera 2009) rather exceptions. Most recently, the drive for economic than national approaches. integration and free trade has brought the stra- tegic environmental and social dimensions into Without a legal grounding, SEA probably will not play more strongly through efforts such as the be used more broadly as an assessment tool. In North America Free Trade Agreement and particular, there will not be an incentive for the the Central American Free Trade Agreement. public sector to use public resources in analyses Other integration initiatives are infrastructure- that, while potentially helpful, are not mandated by based, such as the Initiative for the Integration law and regulations. In the case of environmental of Regional Infrastructure of South America impact assessment (EIA) in earlier decades, legis- (IIRSA), an effort supported by the IDB, the lation provided a basis for broad adoption of the Plata Basin Development Fund, and the Andean instrument and for more professionals and practi- Development Corporation (IIRSA 2009). Some tioners to become familiar with it. Given the solid subregional SEAs have already been supported and improving environmental governance situ- under the broader umbrella initiative of IIRSA. ation in the Region, the potential for legal reform Given their multicountry, long-term, and broader incorporating SEA leading to its greater adoption development impact objectives, these types in decision making is significant. In Chile, for of initiatives are more amenable to strategic instance, there is a strong legal basis for SEA, and planning that generally would include SEA. there seems to be a significant increase in its use throughout different sectors before adoption of Certain trends in the Region also tend to provide plans, programs, and policies. It will be important a more solid grounding for SEA initiatives, such to look at this case in the coming years to see the as the need for structural changes (privatization, strengths and weaknesses of the approach taken competitiveness, rapid expansion of services, and how SEA is used. and so on) or rapid transformation of the land- scape (deforestation, agriculture, livestock, In any case, because of its inherent strategic forestry expansion/production). In this latter area, nature, SEA will not be as widespread as the EIA as discussed before, the deforestation aspect instrument is today. An important question that has received the most attention in the Region can be asked is whether the legal requirement through current REDD+ initiatives. of SEA is necessary. What are the implications of this legal adoption? There is a strategic analysis Trends that Influence Use of SEA in the that could and should be done to respond to World Bank these questions. A clear case for justifying the benefits of a mandatory SEA from the social, From the World Bank perspective there is a environmental, and economic standpoint would clear “spike� in the use of SEA based on initia- be needed if SEA were to be mainstreamed. tives at different points in time. An early trend was Given the slow progress in ingraining SEA into mentioned in the water sector policy reforms (and the legislative framework, the Bank—although to some degree the energy sector), followed by the it cannot drive specific legislative efforts—can trend in CEAs as an input to regional policy-based support analysis and consideration of what legal lending in application of OP 8.60. Current DPLs, 86 Str ategic Environmental Assessment in the World Bank however, especially those environmentally oriented, Financial limitations are another important aspect rely on other less specifically prepared technical that appears to underlie the slow trend of a and policy analyses rather than SEA as inputs to more extensive use of policy SEA in the Region. the preparation process. CEAs in the past provided Infrastructure-based initiatives generally have a estimated costs of impacts, which is a good way to more clearly defined financial investment, more establish dialogue with decision makers, particu- easily quantifiable return on investment, and larly in ministries of finance, about the national costs generally more clearly defined environmental of environmental degradation on human devel- costs and benefits. The costs of a regional or opment (R. Tolmos, personal communication). CEA, even national exercise can be somewhat more however, has largely disappeared from the Region tangible and easily justified by virtue of the partly due to lack of funding as the CEA trust fund potential direct impacts and large size of future was finalized and also because of the level of effort investment programs (or income from sectors required to undertake CEAs. such as mining or petroleum, for example). It is important that practitioners adapt the use The same cannot be said of the policy SEA. These of SEA to consider these new regional scenarios exercises are more intangible by nature, with many and related institutional constraints. The use imponderables not as readily visualized. These of “rapid� SEAs may be a good approach challenges would likely test the effectiveness of under these conditions in spite of the negative SEA in LAC through the SESA for the REDD+ impact on the depth of the analysis and stake- readiness. The national scope of the REDD+ holder engagement. The Region might be well programs may require extensive consultative positioned to deal with this situation, given its processes that can be costly, given the potential improved governance, strong voices for civil need to support participation by stakeholders. society, representation of stakeholders in national The potential implications from a financial stand- fora, and relatively good Internet and telecommu- point of a future REDD+ strategy and payment for nications coverage. environmental services system are not clear at this point, which makes a nationally driven process, in the absence of legal requirements, more difficult Discussion and Trends to justify. However, the potential impacts from a social standpoint are generally recognized and From the World Bank side, support for the use provide for strong support from civil society for the of SEA in LAC has varied over time. There was advance of these initiatives. a strong push from the early to mid-2000s, possibly linked to the expansion in the use of Sectors Not Always in the “Driver’s Seat� policy-based lending instruments (DPLs) that sustained an important CEA preparation process Important sectors driving not only the invest- that has since subsided. Country partnership ments in infrastructure but also the policies for strategies now variably incorporate the environ- promoting private sector initiatives are not always mental dimension in their analyses (with some leading the SEA processes. In cases where they exceptions regarding climate change). The are, there is more likelihood of adoption of the experience seems more linked to the availability policy and programmatic approaches emerging of funding to support these efforts rather than from the analysis. Challenges to achieving this a sustained effort. The limited experience may result include the lack of specialized personnel be insufficient to create momentum in the use with environmental and social training to steer of SEA by World Bank clients in the Region. A the process. This is worsened by the absence of critical mass of practitioners within the Bank and legal requirements and competing institutional the Region to facilitate the preparation of SEAs mandates to fulfill other operational activities seems also to be lacking. such as supervising projects. World Bank SEA Experience in L atin America and the Caribbean: Enhancing Infr astructure Developments and Sector Reforms 87 Environment agencies have been the lead institu- programs in the Region supported by the tions generating many SEAs, given their interest Bank. The current trend in SEA/SESA from in reducing environmental degradation. But the the most recent experience of the FCPF has convening power of the environmental agency been to optimally utilize existing stakeholder may not be great or exist at all in the absence of platforms that are well developed as opposed some legal mandate to do so. to establishing new platforms for ongoing sector or thematic dialogue. This does not mean that Certain Sectors More Amenable to SEA in specific cases the SEA process cannot be a catalyst for establishing platforms for dialogue, Some exceptions have been found in the water especially at regional levels; however, national- sector, where the multisectoral nature in terms of level SEA processes in particular can generally management requires better institutional coordi- use existing platforms. In the case of Mexico, nation that occurs more naturally based on long- the SESA process has been mainstreamed into term integrated water resources management the national strategy preparation dialogue efforts and competing needs and uses of water process and utilizes several platforms, including resources. Given the nature of the resource, it also the National Commission for Development may be seen as more “strategic,� as its value may of Indigenous Peoples and the Mexican Civil be more easily quantifiable in monetary terms and Council for Sustainable Forestry. Other SEA its use more clearly recognized in regard to human efforts in Mexico such as the Michoacan sustenance and well-being. However, this may not case (Damania et al. 2010) also used existing necessarily be the case for biodiversity and forests. and recognized platforms to develop and mainstream subnational adaptation strategies. Making SEAs more broadly understood by These design features ensure that stakeholder decision makers with tangible demonstrations of dialogues are not de-linked from the primary their utility for improving development outcomes sectors they are focused on and can be is key to increasing their use in the Region. sustained in the future. Considering the importance that the World Bank, along with other development banks and Capacity Building for SEA agencies, is giving to the knowledge agenda, this is an area that could benefit from a more Efforts have been made by the World Bank sustained, planned, and coordinated effort. over the last decade at both the thematic level and the project level to create national capacity Bank Regional Experience in SEA Limited in for SEA. Currently SEA capacity building driven Key Sectors by the World Bank in the Region is limited to ad hoc efforts linked to specific operations or to Transport, mining, energy, and agriculture are all occasional regional training efforts. While the key areas of interest to the World Bank’s devel- demand and opportunities for national-level opment agenda, but there has been limited SEA SEA may be declining, given improved gover- experience in these sectors. Nevertheless, the nance and capacities in the Region (of largely sectors have been approached in some select middle-income countries), subnational lending cases. Because of the important portfolio in is increasing and may present an oppor- transport, energy, and rural development, greater tunity for increasing the use of CEAs. In this use of SEA might be expected. context, SEAs could be undertaken at more- manageable scales and may have a greater Impact on Stakeholder Engagement chance to influence decision making on devel- opment strategies and programs. This analysis has not looked at specific outcomes regarding ongoing platforms created by SEA 88 Str ategic Environmental Assessment in the World Bank Conclusions with IFC colleagues. Recently the Region has discussed the issues of wind power strategic The last 15 years of Bank-supported SEA in LAC assessments, given the overlap of public and have covered a variety of sectors and included a private investments in southwestern Mexico. But number of approaches that ranged from country greater coordination efforts are required, which environmental assessments to inform DPLs to must be supported with human and financial sector strategies in tourism, water and sanitation, resources. This partnership could be strategic, and others, including multisectoral national since the Bank has a solid engagement with the strategies for REDD+ readiness currently being public sector while the IFC is a good partner carried out throughout the Region. The experi- for convening the private sector and for driving ences during the period, however, were not built international standards at a broader scale for upon a longer-term systematic view to increase corporate adoption. SEA use in the Region, as had been done to a certain extent with EIA policy. Client coun- Private Sector Involvement tries have not seen the advance to SEA as incre- mental or as transformational as the use of EIA. Private sector considerations and buy-in would The approach from the Bank in the dialogue on be critical to foster environmental integration in country partnership strategies and development policy and planning in LAC. Given the importance planning has not been systematic either. of the Region now and in the future in regard to commodity production from mining, agriculture, The year 2011, however, was an important livestock, and forestry, the potential benefits inflection point in that the World Bank’s could be great if these were based on more solid Operational Policy 4.01 on environmental and widespread SEA efforts. assessment formally added SESA to the list of instruments that can be used in World Bank Regional Priorities for Action operations. This, in addition to the establishment of the SEA Community of Practice as a natural Deforestation is a regional priority, given the follow-on to the pilot initiatives on SEA, should continuing expansion of the commodities sectors. sustain a more important and focused effort Mining and energy are more critical in the shorter in the near future to mainstream SEA in Bank- term (in the Andean region) while agriculture and supported LAC activities. To this end, some livestock are more important in other subregions, suggestions are made here. They consider the such as Central America and the Southern Cone potential for World Bank engagement, given of South America. Some large countries, such the current emphasis on certain issues and as Brazil, Argentina, and Mexico, deal with all of approaches in the Region. these dimensions concurrently. Coincidentally, their federal systems add a layer of complexity to Coordination with IDB and International developing strategies and SEAs. The World Bank Finance Corporation (IFC) is working more with state and municipal-level projects in these countries that have relatively Some development partners, such as the IDB, high capacity and can pave the way for greater have advanced more strongly in areas such as use of strategic analytical tools such as SEA/SESA transport in the Region from the SEA perspective, in other contexts and for other Regions. while the World Bank has substantive regional experience in water and climate change and The World Bank Environment Department has worldwide experience in areas such as hydro- convened an SEA Community of Practice that power and mining, where there is renewed can assist in these efforts to mainstream SEA in regional interest. There also are potential Latin America and the Caribbean. Middle-income entry points for greater World Bank partnering countries make up the majority of the Region, World Bank SEA Experience in L atin America and the Caribbean: Enhancing Infr astructure Developments and Sector Reforms 89 with relatively high capacities and advanced envi- Practice in LAC is highly compatible with the ronmental governance institutions and legislation. World Bank emphasis on knowledge sharing. They look to the Bank increasingly for this added value as a worldwide knowledge Bank as well as The Bank has already developed memoranda for being a provider of financial support. In addition, advancing these approaches and activities with the important experience of high-capacity coun- countries such as Mexico. More resources are tries such as Brazil, Mexico, and Colombia can be needed, combined with a closer analysis of the leveraged to establish South-South knowledge outcomes to provide solid evidence of the utility sharing within LAC as well as across the ocean of SEA. The regional environmental and social to Africa, where there are a significant number safeguards team in LAC also has resources and of Portuguese-speaking countries engaging in experience in SEA to continue developing plat- other South-South exchanges, for example with forms for dialogue with countries on SEA through Brazil. The Region’s strong governance platform their support of projects and safeguards training and active civil society provide the ideal envi- agenda. Finally, the integration of environmental ronment to expand the use of SEA that facilitates and social strategic analyses into the dialogue citizen engagement and voices in development leading to country partnership strategies has planning. Promoting SEA and leveraging global been important in the past and will continue to knowledge through the SEA Community of be important in the future. 90 Str ategic Environmental Assessment in the World Bank References Damania, T. et al. 2010. Confronting a Changing Climate in Michoacan. Washington, DC: World Bank. Green, K., and A. Raphael. 2001. Third Environmental Assessment Review (FY 96-00). Environment Department. Washington, DC: World Bank. Herrera, R. 2009. Guia de Evaluacion Ambiental Estrategica. Santiago: Economic Commission for Latin America and the Caribbean. Hirji, R., and R. Davis. 2009. Strategic Environmental Assessment. Improving Water Resources Governance and Decision Making: Case Studies. Washington, DC: World Bank. IIRSA (Initiative for the Integration of Regional Infrastructure in Latin America). 2009. Metodología de Evaluación Ambiental y Social con Enfoque Estratégico – EASE- IIRSA. Buenos Aires. Kjörven, O., and H. Lindhjem. 2002. Strategic Environmental Assessment in World Bank Operations: Experience to Date – Future Potential. Strategy Series No. 4. Washington, DC: World Bank. Loayza, F. 2012. “Strategic Environmental Assessment, Guidance Notes on Tools for Pollution Management.� In Getting to Green – A Sourcebook of Pollution Management Policy Tools for Growth and Competitiveness. Washington, DC: World Bank. Sánchez-Triana, E., and S. Enriquez. 2006. Using Strategic Environmental Assessments for Environmental Mainstreaming in the Water and Sanitation Sector—The Cases of Argentina and Colombia. Environment Strategy Note No. 15. Washington, DC: World Bank. World Bank. 2001. Environment Strategy. Washington, DC. ———. 2005. Integrating Environmental Considerations in Policy Formulation: Lessons from Policy-Based SEA Experience. Washington, DC. ———. 2010. Implementation Completion and Results Report (IBRD-73090) on a First Programmatic Development Policy Loan for Sustainable Development and Second Programmatic Development Policy Loan for Sustainable Development and Third Programmatic Development Policy Loan for Sustainable Development in the Amount Of US$800 Million to the Republic of Colombia. Sustainable Development Department, Mexico, and Colombia Country Management Unit. Washington, DC. World Bank SEA Experience in L atin America and the Caribbean: Enhancing Infr astructure Developments and Sector Reforms 91 chapter 8 World Bank SEA Experience in Europe and Central Asia The Mixed Effects of Regulation Ruxandra Floroiu and Adriana Damianova38 Russian Federation Estonia Latvia Russian Fed. Lithuania Poland Belarus Czech Rep. Ukraine Slovak Rep. Kazakhstan Moldova Slovenia HungaryRomania Croatia SerbiaBulgaria Bosnia and Herzegovina Kosovo Georgia Uzbekistan Kyrgyz Rep. FYR Armenia Azerbaijan Montenegro Macedonia Turkmenistan Turkey Tajikistan Albania Cyprus 38 Ruxandra Floroiu is Senior Environmental Engineer (ECSS3) and Adriana Damianova is Lead Environmental Specialist (ECSS3). The authors would like to acknowledge the guidance and valuable comments received from Ernesto Sánchez-Triana (Lead Environmental Specialist, SASDI) and Fernando Loayza (Senior Environmental Economist, ENV). 92 Str ategic Environmental Assessment in the World Bank Introduction EC,39 which has been applied differently in various countries, resulting in a variety of client- As a strategic tool for comprehensive analysis of country demands for the Bank’s support on SEA environmental impacts, strategic environmental or SEA-related activities. Internationally, SEA is assessment (SEA) has the potential to drive the also regulated by the SEA Protocol to the UNECE integration of environmental considerations in the Convention on Environmental Impact Assessment development of plans, programs, or sector develop- (EIA) in a Transboundary Context (2003).40 The ment strategies. As such, SEA provides support for EU SEA Directive requires an environmental achieving the United Nations Millennium Development assessment for plans and programs that are likely Goal No.7 on environmental sustainability. All to have significant impacts on environment, while countries and the world’s leading development the SEA Protocol also encourages the use of SEA institutions at the U.N. General Assembly in 2000 in the context of policies and legislation. Many ECA agreed that environmental sustainability requires Region countries include the transposition of the EU integration of the principles of sustainable develop- SEA Directive, the backbone of the SEA legislative ment into country policies and programs to help framework, as part of the legislative harmonization reverse loss of environmental resources. This chapter and approximation with the EU Environmental includes a review of SEA processes and implementa- Acquis.41 Although the SEA regulatory basis in the tion in the Europe and Central Asia (ECA) Region, Region is largely in place, the process of initiation, focusing on cases supervised by the World Bank. scoping, and implementation, and mainly the decision on whether SEA is required, remains the responsibility of client countries. Evolution of SEA in Europe and Central Asia The Europe and Central Asia Region includes 30 countries that are members of the World Bank and The evolution and current status of SEA in ECA covers economies in Eastern and Central Europe, the was reviewed in terms of the relevant legis- former Soviet Union (or newly independent states lation and methodologies, scope of application (NIS)),42 and Turkey. Ten of these 30 countries are EU and practice, key actors, and main implemen- members and 5 others are considered EU candidate tation issues (benefits, problems, what worked members; only Kosovo, Tajikistan, Uzbekistan, and well, etc.). Most countries within the Region have Turkmenistan are not covered by the aforemen- already developed SEA national systems, and in tioned two SEA legislations. Countries that became some cases they have also gained practical expe- EU members or are EU candidate countries have rience with the application of SEA. At the same to transpose the EU SEA Directive into their own time there is need for further support for capacity national or legislative frameworks by specific dead- building, particularly with regards to adminis- lines. Likewise, countries that ratified the Espoo trative capacity of responsible authorities and Convention43 have to implement its provisions. relevant stakeholder groups (economic planners, nongovernmental organizations (NGOs), and the 39 The European SEA Directive on the Assessment of the Effects of Certain Plans and Programmes on the Environment (effective in 2004). public at large). The utility of carrying out SEA 40 The SEA Protocol to the Espoo Convention was adopted in 2003 pilot assessments and providing guidance on and entered into force in July 2010. 41 European Union Body of Environmental Legislation. implementation proved of significant value to 42 The newly independent states of the former Soviet Union are national SEA capacity in ECA. Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kirghizstan, Moldova, Russia, Tajikistan, Turkmenistan, Ukraine, and Uzbekistan. 43 The Espoo Convention sets out the obligations of parties to assess The main driver for SEA in the region has been the environmental impact of certain activities at an early stage of planning. It also lays down the general obligation of states to notify the European Union (EU) SEA Directive 2001/42/ and consult each other on all major projects under consideration that are likely to have a significant adverse environmental impact across boundaries. World Bank SEA Experience in Europe and Centr al Asia: The Mixed Effects of Regul ation 93 In most newly independent states, the legal and which the EU SEA Directive has been defined and regulatory framework for SEA and EIA is largely implemented by the EU countries has varied from established. However, implementation of EIA nation to nation due to application of different and SEA regulations requires significant attention legal, procedural, and political factors. It has to fill in procedural gaps in order to improve been introduced as a separate process and an the effectiveness of this tool for planning and extension of the EIA, established as a two-tier decision making. In many NIS countries imple- system for specific plans and programs (in the mentation falls short, as the legal provisions are Netherlands), or incorporated into regional and not always followed. The opportunities provided land use planning (in Sweden). by the law to use the impact assessment tool for decision making is skirted by local politics The various models and approaches in the and disincentives for its application to stra- region can be analyzed as corresponding to two tegic proposals. Also, some NIS countries make types of SEA that distinguish between insti- no distinction between EIA and SEA, and their tution-centered SEA (I-SEA, or the “policy SEA�) legislation requires that laws, programs, plans, and the impact-centered SEA (the “EIA-SEA�) and projects are all subject to environmental (OECD-DAC 2006; World Bank 2008). A great assessment. Many NIS countries (for instance, percentage of SEAs undertaken in ECA use the Belarus, Georgia, Kazakhstan, and Ukraine) impact-centered approach to help ensure that still use the former Soviet system of the State environmental considerations are not overlooked Environmental Expertise,44 albeit in conjunction while outlining the sustainability of the proposed with new legislation. As a result, in practice there actions; this includes cumulative impact assess- appears to be little or no development of SEA ments (CIAs), SEAs for land use plans, and EIAs (Dalal-Clayton and Sadler 2005). of large projects. The status of SEA application is different in In addition to the SEA Directive requirements Central and Eastern Europe (for example, in the in ECA, the Bank’s policies require clients to Balkans and Baltic countries). It largely adheres comply with its own environmental safeguards to the internationally accepted practice in coun- policies for investment and development policy tries that moved toward full transposition and lending. Yet financial constraints, client countries’ implementation of the EU SEA Directive. These interests, and priorities at the national level as countries are required to assess their proposed well as the lack of adequate capacity especially plans and programs for future use of EU structural in the former Soviet countries are some (but not funds. Several countries (Poland, Czech Republic, all) of the reasons why only a few SEAs have been Estonia, Hungary, Latvia, Bulgaria, and Romania) prepared with the assistance of the Bank in ECA carried out comprehensive SEAs mainly linked to (as described in this chapter). specific sector plans such as regional waste/water management, tourism, agriculture, or transport, Furthermore, other donors in the region— which later provided input into national planning such as the U.N. Environment Programme, the documents (Dalal-Clayton and Sadler 2005). U.N. Development Programme (UNDP), the Organization for Security and Co-operation In Varied and diverse methodologies are used in Europe, and the Regional Environmental Center ECA in developing SEAs, with all of them empha- (REC)—actively support SEA capacity in various sizing integration of environmental effects into countries45 or finance public-private infrastructure national plans, sectors, and programs. The way in facilities, programs, or other sector-specific policies (such as a transportation program) that 44 The Federal Law on Environmental Expertise (1995) set proce- dures of the State Environmental Expertise that was carried out by a Commission of Experts formed by a specialized, fully 45 UNDP and REC implemented the regional project SEA – empowered state agency on environment in the Soviet Union to Promotion and Capacity-building in Five Countries in Eastern examine a definite project. Europe, Caucasus, and Central Asia Region (2004–2006). 94 Str ategic Environmental Assessment in the World Bank call for preparation of an SEA. The International it seems that only in Azerbaijan did the CEA Association for Impact Assessment hosts an inter- analysis serve as an entry point for the application national meeting with training events on SEA of SEA linked with the regional development plan each year, in which agencies share their experi- of the Greater Baku area. ences (see www.iaia.org). The Bank has made a specific commitment as Application of SEA in the ECA Region part of OP 8.60 to undertake poverty and social impact analysis in order to examine the poverty Policy SEA reduction impacts on different stakeholder groups as part of proposed lending programs It is important to note that SEA’s ability to rein- and policy reforms. While PSIAs focus almost force other policy assessment approaches through exclusively on economic, social, political, and instruments such as the country environmental institutional analysis, in some cases in the Balkan analysis (CEA), poverty and social impact analysis countries the Bank is addressing the linkages (PSIA), or energy-environment reviews/strategies between environmental management and (EER/S), is widely recognized. All these approaches poverty as part of the PSIA. The authors suggest take a broader view on country environmental addressing environmental concerns more strongly priorities, policy options, and implementation to ensure the longer-term sustainability of capacity, and they could influence the government proposed interventions through integration of the approach to broader development and lead to SEA concept into PSIA and into related national further demand for application of specific SEAs. planning strategy and policy development opera- However, as described below, in ECA there is no tions supported by the Bank. clear evidence that development of such broader policy reviews has influenced the client countries The preparation of energy-environment reviews to use SEA as a step toward more sustainability- was useful in ECA for influencing energy and envi- oriented environmental management. ronment policy and interventions in the Balkans (Bulgaria and Russia) and Central Asian coun- The country environmental analysis is a diagnostic tries (Tajikistan) (see www.esmap.org). In the case tool aimed at providing the analytical under- of environmental strategies, for example, these pinning for integrating the environment into the analyses would further assist the respective govern- development process and sustainable devel- ments to narrow down priorities and to highlight opment assistance. It does provide a framework actions that could achieve major environmental to systematically link country-level analytical improvements in the short to medium term (such work with strategic planning processes. This as Poland, Bulgaria, and Romania Environmental tool includes an institutional analysis with the Strategies developed in 1992). Applying SEA objective of assessing institutional capacity to would further strengthen the sustainability of sector address environmental implications of policy strategies (for example, urban environment infra- reforms supported through development structure, water, health, and transport). policy lending operations, assessing capacity to manage country’s environmental concerns, Impact-Centered SEA: Case Studies and providing a strategic focus to safeguards issues, Lessons Learned and providing strategic guidance and identi- fying areas of technical assistance and invest- The case studies analyzed in this chapter mostly ments (World Bank 2003). While several CEAs follow the requirements of the EU SEA Directive have been prepared in countries46 in the Region, in terms of approach and methodology, with certain factors being given different weight (such 46 CEAs have been prepared in Belarus, Serbia, and Montenegro as approach on public consultation, alternatives, (2003); in Tajikistan and Ukraine (2008); in Armenia (2009); in Azerbaijan (2011); and in Kosovo (ongoing). and cumulative and interrelated effects). An World Bank SEA Experience in Europe and Centr al Asia: The Mixed Effects of Regul ation 95 overall concern in ECA was whether SEA should monitoring programs in Estonia are usually built on be integrated into the urban planning process effective and sufficient data. The overall sectoral or conducted as a parallel, independent process environmental assessment results helped finalize in line with the opportunities and constraints of the country’s new energy policy and launch each country. The SEAs developed with Bank specific priority investments in the district heating assistance were mainly for regional and local sector (for example, the World Bank–financed plans (Georgia and Albania) and to a lesser extent District Heating Rehabilitation Project). The public for sector programs (Kosovo), and some were consultations were limited to discussions held used as a planning tool in the stages of project only with related government representatives preparation. The Bank policy OP 4.01 allows (the Ministry of Environment and State Energy the SEA to be used as a main environment and Department), the Academy Society of Forestry, social assessment tool when appraising projects and several relevant NGOs (SERI et al.1994). financed by the Bank, so there is a possibility of increasing the number of SEAs developed in this A strategic environmental and social assessment Region in the future. (SESA) was prepared to identify environmental and social issues of projected developments in SEAs Developed with World Bank Assistance the power generation and related lignite mining sectors in Kosovo as part of the Bank-financed A sectoral environmental assessment was Kosovo Lignite Power Technical Assistance prepared to evaluate the potential short-, Project. The SESA developed a framework for medium-, and long-term environmental impacts, the assessment, consultation, and regulation of environmental management, and monitoring follow-up investments to mitigate any potentially issues associated with the harvesting of peat negative consequences of interventions proposed and wood raw material and their processing and under the Sibovc Development Plan (SDP).47 The use as fuels in heating systems in Estonia. The SESA was prepared in parallel with this plan and assessment—financed by the Swedish Board was initiated by the Ministry of Energy and Mining for Investment and Technical Support at the of Kosovo. The analysis included the current request of the government of Estonia in 1994 environmental and social situation in the area of and supervised by the World Bank—provided interest, analyses of the alternative development an evaluation of the issues related to adopting scenarios and their impacts, and a proposed miti- and implementing a national program for energy gation and monitoring plan. conservation and providing environmental guide- lines for use in activities proposed for funding Results and lessons learned : The SESA eval- by the World Bank and other institutions. The uated the benefits of the SDP, including assessment included an analysis of possible envi- reclamation of mining areas and polluted ronmental impacts resulting from the proposed surroundings, improvement of existing specific program and an analysis of possible alternative infrastructure, and related employment oppor- programs. A mitigation plan and a monitoring tunities and economical development. The plan were also included, as well as identification public involvement played a critical role in of institutional development measures required quality control and assurance in the SEA to increase use of local fuel resources in an envi- process (ERM 2008). ronmentally sound manner. The SEA for the Southern Coastal Development Results and lessons learned : The baseline infor- (SCD) Plan in Albania was developed in mation did not include current data on all December 2007 in line with the government’s parameters necessary to develop a feasible envi- 47 This regional sector development plan was prepared on the basis ronmental monitoring program (such as water, soil, of the Energy Sector Development Policies, which include all existing and planned lignite mining and power generation activ- or air quality), although the basic environmental ities in the Sibovic-Obiliq area. 96 Str ategic Environmental Assessment in the World Bank commitment to ensure sustainable development of a strategic environment, cultural heritage, and of the Southern Coast while optimizing economic social assessment (SECHSA) (February 2012). developments and job creation. The challenge was to elaborate and implement the SCD Plan Results and lessons learned : The SECHSA and a tourism development strategy that exploits process encountered two challenges: the tight the key assets of the natural and cultural environ- timeline for completion, as the SECHSA approach ments while minimizing negative environmental was not part of the project concept, and the lack impacts. The SEA report was developed based of baseline information from national databases on a compilation of available materials, interpre- to assess the impact of the proposed program. tation of existing baseline data, and a thorough Baseline data collection included extensive compilation of existing infrastructural elements in overview of available literature and studies as the Southern Coastal area. well as consultations with experts and repre- sentatives of several entities. Notwithstanding Results and lessons learned : The SEA process these constraints, two points are worth high- relied on the existing outdated and incomplete lighting. First, the SECHSA created strong baseline data (for instance, a survey on biodi- ownership from several line ministries and the versity, data on effects of sewage discharge, regional government as well as full involvement and so on at specific sites were not available), as of the cultural heritage agencies, the Church, no field work or other means of collecting new residents of buildings that will undergo reha- data and information were carried out. Thus, bilitations as part of urban regeneration efforts, projections of future infrastructural needs for the population of remote mountainous areas, supporting a sustainable tourism development and NGOs. Second, the local communities were and analysis of their relevant impacts were given not particularly interested in the environmental only on the basis of existing information, consul- aspects of development, as they were mainly tations, and limited site visits. The SEA report concerned about potential resettlement, but was prepared in parallel with the SCD plan and there was excitement about job creation. Also, included among other aspects the transboundary the SECHSA directly contributed to the screening effects on landscape, marine areas, and cultural of all potential investments under the World heritage and community habitat related to this Bank project and the development of the envi- plan. The SEA process concluded that the imple- ronmental management framework. Finally, the mentation of the plan will require establishing a SECHSA report was used to meet the project thorough EIA process for all major activities and appraisal conditions in line with OP 4.01, and it projects and formulating and observing relevant is expected that it will feed into the decision- environmental management plans. Also, capacity making process as it continues during project building and institution strengthening, sectoral implementation (SECHSA 2012). coordination and cooperation, and development of relevant monitoring indicators were considered The World Bank supported the government of crucial for effective implementation of the SCD Montenegro’s capacity building in SEA linked Plan (COWI 2007). to the National Spatial Plan (NSP) through the Bank–Netherlands Partnership Program. This The government of Georgia asked the World SEA training and capacity building program Bank to support regional development in Kakheti. was developed based on a specific SEA pilot The Regional Development Strategy for Kakheti to familiarize government and other stake- (2010–2014) concluded that tourism and agri- holders with the SEA planning tool. It was also culture in Kakheti offer significant development considered a great example of donor harmoni- potential and proposed a priority Action Plan. zation and division of labor, as the World Bank The implementation of the Kakheti Regional and the Netherlands Environmental Assessment Development Program required the preparation Commission focused on technical support for World Bank SEA Experience in Europe and Centr al Asia: The Mixed Effects of Regul ation 97 SEA while GTZ supported the analytical studies SEA and the type of information to be considered, linked to the NSP and UNDP supported the describing and analyzing the environmental public participation process. However, the timing baseline information, organizing meaningful of the SEA in relation to the draft plan closing meetings for public discussions of the report, and stages made it difficult to fully integrate its fulfilling the conditions stipulated in the decisions. findings into the planning process. Results and lessons learned : There was little or no Results and lessons learned : The SEA made a public interest during the SEA review. However, valuable contribution to the public discussions NGOs supported the SEA process as being that were part of the plan development. It also useful input to plans and contributing to trans- affected positively the attitude and capacity of parency and public access to information. The time some of the stakeholders, yet it did not have a constraints and limited resources available trig- substantial impact on the development of institu- gered use of available data, which were scarce, tional capacities. The transfer to the Montenegrin and not tackling all technically complex aspects of authorities of skills and experience needed to waste management, water supply, and energy. EIA undertake SEAs and their real ownership of the specialists involved in the process emphasized the process are important. It was also learned that need to apply the SEA procedure from the earliest for the purpose of spatial planning, SEA needs to phase of the plan preparation. The Ministry of give equal weight to economic and social dimen- Environment and Water amended the EIA regu- sions as well (OECD-DAC 2012). lations as a result for the SEA process findings to clarify the procedures to the planning process in SEAs Developed by Client Countries with the country (Grigorova and Metodieva 2001). Other Donors’ Assistance An SEA of the the Bratislava Land Use Plan, The EU and other multilateral and bilateral inter- Slovakia, was undertaken in line with the EU SEA national donors are enhancing the practice Directive. The analysis covered a comparison and application of SEAs in ECA through direct of the objectives of the comprehensive devel- exchange of experience via national workshops, opment strategy of Bratislava city and the three capacity development trainings, and financing of alternative land use plans, assessment of the envi- specific SEA pilot projects. Several SEA examples ronmental quality to identify positive and adverse are provided below to underline that the interna- environmental impacts of individual land use plan tional experience efforts in promoting the SEA policies, and identification of mitigation measures tool in the Region should be also considered an to address adverse effects. The SEA procedure SEA driving force in addition to the relevant EU followed a two-tier approach: a strategic evalu- SEA Directive regulation provisions. ation was undertaken of the goals, aims, and aspects of the plan against sustainability prin- The SEA for Varna Municipality Development ciples, and a detailed evaluation was made of the Plan, Bulgaria, was part of a World Bank-financed plan against sustainability indicators, both quali- program for development of the Bulgarian Black tatively and quantitatively, while including cumu- Sea Coast, which included the preparation of lative impacts. development plans for the 14 municipalities of this region. Each plan was subject to a pilot SEA, Results and lessons learned : The process which represented the first application of this provided an opportunity to generate more envi- tool for sectors and programs in the country. The ronmental information, especially on impacts. main purpose of this SEA was to integrate envi- There is need for SEA to be initiated earlier ronmental conditions into territorial and urban in the land use plan preparation process. The development. Issues encountered during the SEA sustainability goals set out in the Bratislava process included determining the scope of the Development Strategy were too general. SEA 98 Str ategic Environmental Assessment in the World Bank should be linked procedurally and methodologi- ■■ SEAs were used effectively for further cally to a tired approach at different levels of land programming documents (such as use planning (Dalal-Clayton and Sadler 2005). environmental management frameworks, energy policy drafts, and action plans). The SEA of the Waste Management Plan (WMP) in the Czech Republic (a framework document ■■ The preparation of SEAs enhanced the developed for 2003–2012 for access to EU opportunity for public involvement in structural funds) was carried out as a separate, all phases of SEA and planning. parallel process from the plan and included four main steps: scoping, review of detailed terms of ■■ Severalaspects of SEA practice were reference for the SEA, preparation of the SEA addressed superficially, such as cumulative report itself, and public review. or health effects or transboundary linkages. Results and lessons learned : Based on the SEA ■■ SEA follow-up activities and monitoring assessment (including consideration, discussion, framework were weak, but they are key tools and selection of alternatives and related issues), for ensuring that the SEA outcomes will the SEA team identified various inconsistencies actually be taken into account. among the plan’s objectives and measures, issues, and indicators. The SEA provided input into all key At the same time, some barriers or challenges stages of the process; also, it facilitated stake- to the SEA process emerged out of the review holder input into the review of arrangements concerning the scale and timing of an SEA, the for the plan implementation and monitoring. rigid approach to the scoping, the timing of However, it was difficult to establish in the end the stakeholder engagement, limited awareness of contribution that SEA made to the WMP process, SEA process, and the capacity and resources as from the planning perspective the SEA process for implementation. concentrated too much on the methodology and report preparation rather than influencing decision The lessons learned include the following: making at various stages of the WMP (Dusik 2003). ■■ From the outset, ensure that the SEA’s Summary of Results and Lessons Learned role is understood and supported by the decision makers; also, clarify the The main findings from the cases reviewed SEA benefits and when and how it is in the implementation of SEA in the ECA important to apply SEA so that political Region include: commitment is secured. ■■ TheSEA’s convening power facilitated better main stakeholders who would ■■ Identify coordination among all stakeholders and can champion, support, and own the SEA create an enabling environment for conducting through the entire process. a substantial dialogue on strategic environ- mental issues. ■■ An effective SEA can be undertaken in parallel with the planning and ■■ Evaluation of impacts was mainly based on preparation of a project, program, various stakeholders’ input and concerns; strategy, or plan rather than after it (as, for however, there were slightly different example, in Kosovo and Azerbaijan). approaches concerning assessment of impacts (for example, direct impacts of projects versus ■■ The quality and availability of baseline data indirect effects of general activities). is crucial to allow development of scenarios and/or gap analysis. World Bank SEA Experience in Europe and Centr al Asia: The Mixed Effects of Regul ation 99 ■■ Sufficienttime and resources have to be The SEA proposed in Tajikistan will build upon provided throughout the SEA and the the results from the World Bank’s country envi- relevant planning steps (a public consultation ronmental analysis. It will contribute to shaping process may take a minimum of four months, the country’s overall energy development for instance). outcomes by integrating environmental and social considerations into the national energy policy ■■ The methods used and the form of presenting and sector growth. It will also analyze relevant outcomes must be understandable for the components within the Tajik energy sector in their decision makers. The SEA team should relationship with transnational energy trading and intensively communicate with the planners development schemes. Specifically, the SEA will so that the SEA proposed modifications analyze, from environmental and social points could be considered at an early stage of the of view, Tajikistan’s energy policy, the plans for plan drafting. the energy sector, the role of the Vaksh River Development Masterplan and existing trans- mission projects included in the energy policy Ongoing and Potential SEA and long-term planning, and the government‘s Development in the ECA Region schemes on energy sources other than hydro- power (such as a coal-fired thermal power plant and renewable energy) and energy conservation. For fiscal year 2013, there are a couple of SEAs under implementation in ECA under the In Armenia, the Bank is continuing a policy guidance of the Bank. These include the SEA of dialogue established through the development the Greater Baku Regional Development Plan policy operations (DPO) series to protect the (RDP) in Azerbaijan and the SEA linked to Rogun poor and vulnerable while fostering competi- Hydroelectric Power Plant Construction Project tiveness. The new DPO series aims to emphasize in Tajikistan within the context of the entire Vaksh the sustainability of policy reforms supported River Development Master Plan. by this operation. This would include support to policy and regulatory actions for wider inclusion The government of Azerbaijan is preparing a of stakeholders and NGOs in implementation sustainable vision for the metropolitan region of the mining code, preparation of guidelines and the surrounding Absheron Peninsula area by pertaining to environmental and social provisions launching the preparation of the Greater Baku RDP in the mining sector, and implementation of the with support from several World Bank–funded provisions of the new EIA law. The DPO series projects. The SEA to be developed in parallel with would support actions related to Armenia’s obli- the Greater Baku RDP will examine environmental gations to international conventions concerning consequences and risks and will investigate alter- access to environmental information and trans- natives to specific aspects of the plan, ensuring portation of dangerous substances. As the that possible impacts of the programs are iden- government is preparing a national strategy tified before their adoption. The focus will be on on minerals, there would be an opportunity constraints (sensitive environments and potential to launch discussions on integration of SEA costs) and opportunities (resources and potential elements into the national EA system in relation benefits) for protecting environment media (water, to the mining sector. soil, air, biodiversity), land resources, and social aspects. This involves documenting any existing Also, in Turkey the proposed Third Environmental environmental issues, assessing direct and indirect Sustainability and Energy Sector DPO is helping (secondary and cumulative) impacts, and evalu- the country to improve the effectiveness and ating strategic benefits to be considered by the efficiency of environmental management relevant authorities. processes, in the context of harmonization with 100 Str ategic Environmental Assessment in the World Bank the EU Environmental Acquis, including, among successfully creating and implementing a drought others, the transposition of SEA EU Directive into management and adaptation strategy. national legislation. It is expected that the SEA regulation will be finalized and approved during 2012. Ahead of formal approval of the regulation, Conclusions the government has already launched capacity and Recommendations building projects for SEA implementation and considers that implementation of SEA should There are “teething problems� in SEA practice start with a specific sector SEA (such as transport) supported by the World Bank in ECA despite the rather than regional or urban development plans, legal provisions required by the EU SEA Directive. given the need for clarification of coordination/ The review of the SEA case studies in this chapter responsibilities between central and local levels shows that there is an ongoing debate on the for urban plans. suitability of the SEA tool in the developing countries of the ECA Region. This indicates the In linking energy sector investments to the overall need for an effort to increase capacity and raise national strategy, the Bank has recently advised awareness of the SEA utility in the Region. We the government of Turkey to prepare a cumu- believe that the reasons for limited SEAs are not lative impact assessment related to hydropower so much technical as they are lack of political and dam construction. Cumulative impact assessment institutional will, limited skills and knowledge, is a technique designed to assess the combined sectoral organizational fragmentation, and a lack environmental effects of multiple activities. The of clear environmental priorities on some govern- CIA findings would help in the overall environ- ments’ development agendas. Consequently, mental management aspects of hydropower because of the lack of understanding of the SEA dam construction and would regulate private tool and of adequate resources and capacity sector investments in renewable energy and within government departments and agencies, energy efficiency activities. The CIA may also most clients in ECA view SEA as an unnec- help the government of Turkey in advancing the essary and bureaucratic step rather than a tool SEA agenda from an institutional and capacity for informing the decision-making process and building perspective as part of harmonizing the providing strategic inputs for planning. country’s legislation with the EU Directives. Furthermore, it was noted that most SEAs were There is a possibility of launching a SEA linked to undertaken under considerable financial and drought management and mitigation assessment time constraints. There were observed differ- for Central Asia and South Caucasus to raise ences in terms of describing mitigation actions, awareness and understanding of climate vulner- consideration of alternatives, monitoring, and ability to drought in this area, with the ultimate assessing interrelationships among impacts. Thus, purpose of introducing a strategic, pro-active the quality and effectiveness of the SEA process framework for adaptation. Overall, the SEA varied, reflecting the resource constraints, lack intends to help the Ministries of Agriculture, of methodological guidance, unclear internal Irrigation and Water Resource Management, and responsibilities, and ultimately the limited Environment as well as meteorological services, capacity of participating stakeholders. emergency services, and regional and local government (including municipalities) to improve Public engagement is critical. Undertaking the their preparedness for future droughts. The SEA SEA report in a participatory and transparent would provide recommendations on how interna- manner is important in order to avoid criticism tional agencies, including the World Bank, could from NGOs or other interested stakeholders. coordinate and synergistically assist the coun- Also, proper identification of stakeholders, highly tries of Central Asia and the South Caucasus in interactive modes of public involvement, and World Bank SEA Experience in Europe and Centr al Asia: The Mixed Effects of Regul ation 101 analysis of public participation effectiveness are Also, given that almost all client countries in keys to a good-quality SEA. ECA are subject to SEA regulations such as the EU Directive or the Espoo Convention, it will Finally, it is important to seek or improve political worth elaborating further on the benefits and commitment for SEA at the highest as well as at costs of these regulations, particularly in terms of local levels. improving public decision making, environmental planning, or social learning in the design and In ECA, it is vital to use SEA despite implementation of public policies. institutional weaknesses and insufficient capacity for implementation to support The establishment of the World Bank Community long-term sustainability objectives and of Practice for SEA is important, as it will allow effective environmental intersectoral dialogue. monitoring of the development of national and Consequently, technical assistance (for instance, transboundary SEA activities while providing training activities for staff, development of SEA knowledge sharing on relevant resources, guidelines for a sector or specific issues such information, and experience from all Regions. as cumulative impacts, and donor coordination With the increasing policy development and and exchange of experience on SEA) should be innovative instruments such as programs for provided to support innovative ways to promote reform lending in ECA and other regions, the SEA leadership in capacity development for SEA in could be the strategic tool to draw attention to the Region. long-term policy and development constraints concerning countries’ environmental assets and Also, it should be recognized that not all entry as an economic resource. There is a need for points for SEA have been fully explored in ECA. SEA terms of reference related to specific sectors For example, various countries have finalized and the development of concrete guidance for poverty reduction strategies but few or none SEA issues such as cumulative impacts, SEA have triggered the development of an SEA. prioritization, or the assessment procedure. Furthermore, several Country Water Notes (in 2003) have been prepared to review issues and Finally, it will be important to facilitate directions of water resource management in public access of SEA reports in national and Southeastern Europe. While these Notes also international key information sources/tools provided a brief description of the socioeconomic and to provide information on the overall SEA and geographical context of the water sector in process design and outputs (including public these countries, none have addressed any related participation) to international and national environmental impacts and alternatives. stakeholders in order to strengthen SEA good practices. It will be worthwhile to continue reviewing the effectiveness of the integration of SEA into strategic documents (for the ongoing assignments) and to compare the SEA implementation in EU member states with countries from other regions where this tool has been applied. 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Poverty Reduction Group and Social Development Department. Washington, DC. ———. 2008. The World Bank SEA Toolkit. http://go.worldbank.org/XIVZ1WF880. World Bank SEA Experience in Europe and Centr al Asia: The Mixed Effects of Regul ation 103 T h e Wo r ld B a n k G r o u p 1818 H Street, NW Washington, DC 20433, USA Telephone: 202-473-1000 Facsimile: 202-522-1735 Internet: www.worldbank.org/environment