6 ---Er) i~~~~~~~~~~~~~~~~ Y m -| a~~~~~~N i- - >~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~V b X,e -- i L iFrJ | r r 2% §j- 2)D- World Resources 2000-2001 is produced by the World Resources Institute in part- nership with the United Nations Environment Programme, United Nations Devel- opment Programme, and the World Bank. This edition-People and Ecosystems: -5b' t'lI@' I The Fraying Web of Life-focuses on the current condition of five critical ecosys- -- .;S ^-- < tems that have been shaped by the interaction of the physical environment, bio- logical conditions, and human intervention: croplands, forests, coastal zones, fresh- water systems, and grasslands. This Pilot Analysis of Global Ecosystems (PAGE) is _- ' the first step in the development of a more comprehensive Millennium Ecosystem -. Assessment. A summary of the PAGE results are shown in the accompanying scorecard. Overall, there are considerable signs that the capacity of ecosystems to continue to produce ., >* -many of the goods and services we depend on is declining. PAGE results make it ;. .: .clear that human activities have begun to significantly alter the Earth's basic chemical cycles-the water, carbon, and nitrogen cycles-that all systems depend on. "If we choose to continue our current patterns of use, we SCORECARD Fresh- Grass- face almost certain declines in the ability of ecosystems to Agro Coast Forest water lands yield their broad spectrum of benefits-from clean water to Food/Fiber stable climate, fuelwood to food crops, timber to wildlife Production il|' habitat. We can choose another option, however. It requires Water reorienting how we see ecosystems, so that we learn to view Quality their sustainability as essential to our own. Adopting this "ecosystem approach" means we evaluate our decisions on Water Quantity land and resource use in terms of how they affect the capac- ity of ecosystems to sustain life, not only human well-being Biodiversity but also the health and productive potential of plants, ani- X mals, and natural systems. Maintaining this productivity be- Carbon Storage comes our passkey to human and national development, our I hope to end poverty, our safeguard for biodiversity, and our Recreation passage to a sustainable future. " Shoreline Mark Malloch Brown James D. Wolfensohn Protection Administrator, UNDP President, World Bank Klaus Topfer Jonathan Lash Woodfuel I Executive Director, UNEP President, WRI Production KEY Condition assesses the current output and quality of the Changing Capacity assesses the underlying biological ability of ecosystem good or service with output and quality of 20-30 years the ecosystem to continue to provide the good or service. ago. Not Increasing Mixed Decreasing Unknown Excellent Good Fair Poor Bad Assessed Changing Condition Capacity / Scores are expert judgments about each ecosystem good or service over time, without regard to changes in other ecosystems. Scores estimate the predominant global condition or capacity by balancing the relative strength and reliability of the various indicators described in the notes on data quality. When regional findings diverge, in the absence of global quality, weight is given to better-quality data, larger geographic coverage, and longer time series. Pronounced differences in global trends are scored as "mixed" if a net value cannot be determined. Serious inadequacy of current data is scored as "unknown." For more information on World Resources 2000-20001, please visit the website - http://www.wristore.com -~~~~~~~~~~~~~~~~~~~~~~77 .5'~~~~~~~~~~~~~~~~~~w 1 L'! : t|I C( t1 T S "The Environmental Agenda for the 21st Century must build on past successes, capitalize jQS r on advances in information and monitoring technologies, and build better /, ) ) )2 governance." _1}. J >3 - Klaus Topfer Executive Director, United Nations Environment Programme L Tl Ii':i ! c|znl> li-n l .h new working partnership-government, business, and civil soci- or'. t-g1l_9i.. Hi t, l, promotion of sustainable development. But environmental trends _ On ih-*m | t sI l,Ailly in developing countries, remain alarming." Kristalina 1. Georgieva Director, Environment Department of the World Bank Ti-j' iiThe 11 wlt h,l ok,lLini-* of power between corporations and governments has changed, ww, 1l I- rI llrs to come to grips with new definitions of corporate responsibil- ity. Corporate environmental and social values have to be redefined alongside traditional I ~# . values such as profitability, and integrated even more deeply into the heart of strategic VW j: ,'~] thinking and everyday practice." - Peter L. Woicke [E F X Executive Vice President, International Finance Corporation -Tfle concerns raised in the context of the climate change debate simply reinforce the - w urgency to address the fundamental problems facing poor people." - Rohert T. Watson and Richard Ackermann Chief Scientist and Director, ESSD; Sector Director SASEN Environment Matters is a magazine al W eICOm e to a new the World Bank Group. This 2000 issue is an annual review of the Bank's environmental work during fiscal 2000. Bn'weatAlso visit the magazine through the & v 4 i m ~ m te s . fBank'swebsite - C4at er1.. http:/Iwww.worldbank.org. - This issue is "new" in several respects. We have included discussions on a number Environmentally and Socially Sustainable of matters of current interest, as well as reporting on the past year. We have contri- Develop7ment Network Managers - butions from staff across the ESSD Network, as well as outside the Bank. In future Chair editions, we will continue to present a broad range of views. Furthermore, this is the Ian Johnson first issue of Eniviroeonczwot Matters printed entirely in color. Environment Kristalina 1. Georgieva Rural This issue of ErirvivonieCnt Mallcrs, which serves as our annual review on the envi- Robert L. Thompson ronnient and looks back on the World Bank's environmental activities from July Gloria Davis / Judith A. Edstrom 1999 to June 2000 (our fiscal year 2000), ft --: !k . manyv of the Bank's accomplish- ments and the challenges that lie ahead in the environment area. Special Contributors Anjali Acharya The Environment group, along with the Rural Development and Social Develop- Judith A. Edstrom ment groups, comprise the three "families" of the Environmentally and Socially Andres Liebenthal Sustainable Development Network (ESSD). Each group has a distinct mission: Christian Peter Ellen Tynan * The Environment group aims to ensure that the environment is taken into account David Wheeler in Bank projects and programs. This is accomplished in part through its responsibilities for the Bank's environmental assessment procedures and Environment Matters is produced by the - plce.. World Bank's Environment statf with safeguard policies. contributions from the Bank's Regions. * The Rural Development group seeks to enhance global food security and rural well-being by stimulating rural growth and development, eliminating rural Editorial & Production Team poverty, and intensifying agricultural systems in a sustainable way. The rural for thel Annual Review _ sector strategy focuses on the entire rural productive system. For example, the James T. Cantrell management of natural resources in sustainable production systems treats David Hanrahan agricLulLure, forestry, aquacutuLlre, and livestock as part of a larger system. Human Robert T. Livernash Judith E. Moore capital development, infrastructure, and social development are integrated into Gunter Riethmacher rural development strategies and programs. JeaMson Steele e * The Social Development group aims to promote equitable, inclusive, and sustainable development. This group also addresses the social constraints to economic development, such as ownership, participation, civil engagement, and Notes: local capacity building. A major pillar of the Bank's overall agenda is support for community-based approaches and the involvement of local people and All $ = U.S. dollars. NGOs. NGOs are often the social actors who provide crucial information to the The boundares colors, denominations a Bank in identifying development problems. and any other information shomvn on all-gprbes maps in Environment Matters do not imply, on the part of the World Bank Jr fL X Grous. any judgment on the legal status of any territory, or any Ian Johnson endorsement or acceptance of such V boundaries. ViCCi1sdYtfrE|, 1,, a itd SociallUl Sutstait iable Deve/0i1melnte The World Bank Group .1.' .,; -i. Cover: The World Bank Bl/991rZ1rrg < i:(//AIr .W'IO}W, l r). IBRD IDA IFC MIGA COREL International Bank International International Multilateral for Reconstruct-on Development Finance Investmenl Publications Info: 202-473-1 155 & Development Associat.on Corporation Guar3niee Agency General Inquiries: 202-473-3641 Department Fax: 202-477-0565 Web address: htp://www.orldbank.org L I-.l b 1ri445 E; I r. Id.,_t I r. Es, 15i. Printed with soy ink on recycled, chlorine- free paper. Please recycle. 4 - The World Bank Group ,l .i ; ,,,,,. ,, r,.. :.; :,, ,, .,I I., I 1818 H Street, N.W. , ,- -,,.; Washington. D.C. 20433 _~~~~~~~~~~~~~~~ ==e == __IIlel Co, itents ANNUAL REVIEW * 2000 World Resources Institute (inside front cover) t Highlights 1I VIEWPOINT, by Klaus Topfer 4 Implementing the cenvironn ental agenda requires a new- spirit of cooperation anid W urgency.______________ There are signs that the world Overview 6 N is progressing toward (see seoc at rtt)i sustainable development, but Portfolio Review 10 = ~~~~~~~~~~~~~~~conditions on the grouind Portfolio Review 10 ,; _ Srmi lrig The Banik's environment portfolio, remain alarming. including projects with primarily environmental objectives, currently totals about $ Is hillion in lendinJ-. ~~Europe & Central Asia 38 about $15 billion in lending. Since the earLy 1990s, most countries in the region have seen dramatic declines in their GDP and sharp increases in poverty; priority environmental probLems include air quality and water ISSUES resources management. International Governance 12 Latin America & the Caribbean 42 Txvo experts arguie the pros cnd cons of The kev environnmental issues in this Region include management of natural resnurces, urban- creating a newv Global Environmental industrial pollution, and biodiversity conservationi. Organizationi. Middle East & North Africa 46 Corporate Citizenship- 16 In the .NINA Region, the Bank is f(ocusing on improving natural resources management, IFC's Role arresting cmerginig pollution probLems, and strengthening environmentaL institutions. Environmental and social values have to be integrated even morc deeply into the South Asia 50 heart uf corporate strategic thinking and In SAR, the ternm "environment" is primarily thought of in terms of the sustainability of natural exerydas practicc. resources contributiing to livelihoods; the impact of pollution un human health; and the Safeguards 19 functioning of ecosystems to reduce people's vulnerability The Bank in fiscal 200/IL continued to strengthen its 11t environmental and social INSTITUTIONAL REVIEWS safeguard policies. Climate Change 22 MIGA 54 Climate Change 22 Thc Nlultilatcral Invcstment Guarantee Agency has been applying WNorld Bank environmental The concerns raised In the context of the.. climate change debate simply rcinforce the policies aisd guidelhes to its projccts. urgency to address the fundamental problems facing poor people. WBI 55 The \W'orld Bank Institute's Environment and Natural Resources Divisinn (WBIEN) works to Rural Development Revisited 26 facilitate a learning dialugcie and disseminate innovative approaches to sustainable development. The WAorld Bank is preparing anl updated versioni of its 1997 rural developmnnt Bank/GEF 56 sector strategy. In fiscal 200)0, the Bank's Global Environment Facilitv program reached a new all-time high of $2811 million in GEF grants. Environment Services 28 The Bank is assisting sex eral countries in PCF 58 developing sy-stems of paymernts for denvelopng systes. The Prototvpe Carbon Fund (PCF) is attempting to facilitate procedures for creating a market environmental serx ices. in project-based emissions reductions under the Kvoto Protocul. REGIONAL REVIEWS NEWS UPDATES 60 Africa 30 Includes updates on CEP', POPS, Land and Water in Africa, the Social Summit, In Sub-Saharan Africa, the Bank's missioni to Forest Alliance, Cloud Forest, Greening Industries, the Water Summit, Green Procurement, fight povertv is inescapahly linkeed with and an OED Rexiew. environmental protection and improved management of renexvable natural reso irces, East Asia & the Pacific 34 BACK OF THE BOOK In the East Asia and Pacific Region, challenges include improving the environ- menit of the Asian megacities and reversing Environmental Publications 64 the present degradation of the region's forests, marine ecosystems, and svatersheds. Mailing List (inside back cover) An Environmental Agenda for the 21 st Century -1 ' Executive DirectorVIEWPOINT by Klaus T6pfer, Executive Director of the United Nations Environment Programme As we enter the 21st century, it is important to isterial Environmental Forum in Malmo, Sweden in May 2000. tecognize that although it is the scientific and technical chal- Over 500 delegates from more than 130 countries-including lenges ot iu,tauiaible development and environmental protec- over 100 ministers, and representatives of IGOs and NGOs- thon that %x!iii o.;cupy the attention of most people, it is the attended the three-day Forum. The purpose of the Forum was institUtional and behavioral challenges that will prove to be to institute a process for regaining policy coherence in the field more tornmidabi: over time. of the environment, in direct response to the need for such ac- Fac irg the enivironmental challenges of the 21st century tion emphasized in the 1998 report of the UN Secretary-Gen- x-ill. ultiniatelk be a matter of good policies, effective leader- eral on environment and human settlements. s,hip creahx. vtind adaptable agencies, concerned and involved The "Malmo Declaration"*-which was the principal out- c tizer,s. g. lod mtormation, and rational decisionmaking. With- put of this forum and is addressed to the Millennium Assem- OuLt institltonl that are able to connect across problems and bly-acknowledged that the central challenge is to work out set prioi zt'b- I.,o r policies for the environment in the new mil- how the global ambitions contained in the increasing number lenniuLlil ill L disjointed. Without a sound analytical basis of international environmental agreements can be turned into t.O undlelr;L.didint problems and comparing alternative ways concrete local action and implementation. While countries may to reCS'olltl to tI,m, economic values will suffer, and the cur- join in the formulation and signing of ambitious global agen- rent high l, e-el ci political support for environmental protec- das, garnering support and invoking action in a domestic con- t0on c.0td.1d deciri. text is often a different story. The mobilization of domestic and Let Lti not torget that a central fact of our time is the col- international resources, including development assistance, far ltp-sc ft tlhe lon term view as a buffer against harsh reality. beyond current levels is vital to the success of this endeavour. The d0ouibling tzme"-the time it takes for a population to There is an urgent need for reinvigorated international coop- double. or tro tI:'est depletion to double, or the demand for eration based on common concerns and a spirit of international enez to dnt'LiLb-once comfortably measured in generations, partnership and solidarity. The global community must also ha.s now c; ,llapsed to a matter of a few years. This means that recognize the central importance of environmental compliance, tc,i all or isi the difference between short-term and long-term enforcement and liability, and promote the observation of the decisionniakin-,,g iS fast disappearing when it comes to issues precautionary approach as contained in the Rio Principles.* ol triii ii ornflint and development. Let us not forget that in our globalizing world, the agenda The Global Environment Outlook 2000 report* of the is set by economics. It is necessary to take environmental per- U-nited Natrvns Enivironment Programme provides a compel- spectives into account in both the design and the assessment Ling aResni;ent -If the serious nature of the environmental of macroeconomic policymaking, as well as practices of gov- tive.ti lac,d L n the international community. Environmental ernment and multilateral lending and credit institutions such threltts r&rUltinll trom the accelerating trends of urbanization as export credit agencies. The potential of the new economy to and the drxi t .Iopn. ient of megacities; the tremendous risk of cli- contribute to sustainable development should be further pur- mate cham4ne. thi I reshwater crisis and its consequences for food sued, particularly in the areas of information technology, biol- seCe.trih aind the environment; the unsustainable exploitation ogy, and biotechnology. The ethical and social implications and depletion ct biological resources; drought, desertification, must be carefully considered. There must be recognition of the and ulnclontrolle1 deforestation; increasing environmental public interest in knowledge related to biodiversity, including eniergvnc';e thle risk to human health and the environment the interest of indigenous and local commtnities. iron hazaidoti>Ll chemicals; and land-based sources of pollu- The private sector has emerged as a global actor that has tion are all I>^LL'- that need to be addressed. There is also a a significant impact on environmental trends through its in- nerd to pix spe.- tal attention to unsustainable consumption vestment and technology decisions. The Global Compact es- patternli aniong,01 the richer segments in all countries, particu- tablished by the Secretary-General of the United Nations with .lar dexti,oped countries, the private sector provides an excellent vehicle for the devel- Thle ni i roii nental agenda for the 21st Century must build opment of a constructive engagement with the private sector. Oln pa.t succese- capitalize on advances in information and There is also the need for the enhancement of the institu- monitor n.z technologies, and build better governance. It must tional and regulatory capacities of governments to interact with 31111 aIt Cent1in.I uL3 environmental improvement that respects the private sector. A greater commitment by the private sector thIe nmportarcL or social and economic health. should be pursued to engender a new culture of environmen- TlieN.e c 'cl challenges were recognized by the Minis- tal accountability through the application of the polluter-pays ter. tit thi, En. iiknniiment, who met at UNEP's First GlobalMin- principle, environmental performance indicators and report- 4 ENVIRONMENT MATTERS * 2000 ing, and the establishment of a precau- : n /tIIF\\\ /l , if AOtct,ric tL the !\Ialnio Dcda- tionary approach in investment and 1i1I1.Z\\jt/ IL II '4 II ri r Iii. 'iii 'in-or t rrnce .hoiid ini technology decisions. This approach to;.,,1,1 tl.rt- nilor di ltlen,,es to ALlt- must be linked to the development of . t.i|.it Ic dtt' t'loplilelit ainci in [.irtlcU- cleaner and more resource-efficient " U 111, ith i asi:e teltectS ot tihe burden technologies for a life-cycle economy t' l n i.li ii1XtI lon of the and efforts to facilitate the transfer of Far rIt- I t : 1`1 t CortV coLunlter - po ;sed W .- 8--t- :;S w i--1115vt :>\:e>!v~e , 1 \e .1 1l1 v-L aIet Li t n - environmentally sound technologies. -I e i i Over the past two decades, civil U 1Li I a nl I Ot tticlent tCsiurce the societv has emerged as a vibrant new I :. Ar r ! t- -ettlre ti \ CiiSb circl e ot en- social and economic sector of activity 1 1-tIi lific-rtol I radatin and nlcr es- alongside the public sector and the pri- in. pti\crt It nitbt re srew the vate for-profit sector. New elements of itiliIl hit a gre ttrength- civil society have emerged with unpar- i'' i.i t I -l. i ti'n ! I Qt ir iirt.3 I cto er iatice alleled rapidity in nations throughout F M, . ha v-e 1 'i anni t it u re ,. L5.atetn i'!l . [l .lvsc<^lll~iient or ltuture Latin America, Africa, Asia, the nctd- tcr a-n in-tit.-tional architecture Middle East, and Eastern Europe. t! hat Ii> the capac 'lv tn etLcctr-el\ ad- Global civil society acts as the tire-- xlie-ta igf, eni onnienta emerging global moral consciousness. tllL tst In a g Lb..uoz xi'rldt In the past, it has acted as the promoter of the moral ideas and At h 1 - L I \ cii ot t- r. ! enlhtir % 1a\e a. t Odr d i.posal! prescriptions contained in the Universal Charter of Human the hur!n an r uarv 11]itell r !cttiI $ U' acl: 'tstainable de- Rights* as well as the Declarations on the environment at velopmenti i,t a: a .i,tr.il t rcor1c.pt but as- a concrez:te reaitv. Stockholm and Rio. In many respects, global civil society speaks Theunpin LCteLA 1n1 tC-' J elt-pilk rib i. prtictict 1ari iritkirnma- for the world concerning sustainable development, freedom, tiontechbri.l.t-.%- re- *-n rgi iii a i g;'neratinn \ Ith peace, equality, solidarity, and justice. This demand is centered a clear -t r. It i. p t rirn. ,t.'hil rdI I t \ .1 i d . I Lle, , onle n ill- on practical matters and issues: the fight against famine and creasin-1 .I a o'r-, art a iri t I Ir ehiaicectIL a1ri actiL e role ri hunger in the world; the improvement of women's conditions society-.; 1 rl-l .r' h tIl: t-1O''letOe t-.1 ; lTn u :%\ KilcIOL.lleS; at work and home; preservation of the environment; and reduc- We can i.3:iua . po\i .trr1 ".; tr L 'h l 1 20`1 cithorit cletradtlig tion of poverty, social exclu- tlte r1\, rnririerit: Iv r' can on- sion, and intolerance, with a Let us not forget that a centralfact of our time is the it- cin-o ironiental -ecurrtv view to eradicating the main collapse of the long-term view as a buffer against tlroi. l 1ii carI I.nlg: ;ce causes of ethnic and inter- harsh reality. can I*tel integiat enf\ rori- state wars. niecitaI coin rtderatir,r in econorrii!. poi..sl! .e t .:;nl)t- tTter to eordinil.te Ir -yll irtrnhiillelt-s The engagement of these organizations can be strength- I and we .:;an rca,ln,: .i \hI^O!l ut al \. trtet 'o itlit-it -.Iuimn ened through freedom of access to environmental information, broad participation in environmental decisionmaking, as well The -C' icral ot tw Unirec Nariins aticllated this fee,nc ;etrS .potl ;X-ie !tic !1-ai, the I;^Xea lin I co!lnstitute-. as access to justice on environmental issues. Governments must a unique' arid s-s. rIPLt:l -.ll; cei. ttjnc nuci \ ent tit1i Ieontiblter promote conditions to facilitate the ability of all parts of soci- a t- r -tic - iruniNAicAk J!'rILatln 1rInr the ined ety to have a voice and to play an active role in creating a sus- Nationes t i the r1Ai era n Th.,e ! n iontr Su t i te fifte- tainable future. fions in thu n- 1 t2w The \ ! tesnv ! Irrl .;1 lt te f lties fifth se-. ii cro the L ruined Na,ti 'O, Ut- '_l,i- alA.-'eniN\t prov-id s- The decadal review of the implementation of the outcome a uniquepp 'r m li rv ri.l add ! t-s; at tti 1,glIest 1 el the I Cle oti of the United Nations Conference on Environment and Devel- the Unit, N ati .rr. irii t, t -tLtlplict. opment in 2002 will provide a unique opportunity for the glo- bal community to reinvigorate the spirit of Rio. The Environment Ministers who gathered at Malmo stated that the \ -\ objective of this summit should not be to renegotiate Agenda 21, which remains valid, but to inject a new spirit of coopera- Klaus T ar tion and urgency based on agreed actions in the common quest forsustainabledevelopment.Theyrecognizedtheneedforgov- United ,,in...v F; ....'....u..uum.r I' F- ''11f:urob crnments and the environmental authority of the United Na- Kenya. -L- ' - - i,;' :- - tions system-UNEP-to play a major role in the preparation 1' ! pl,-se see tiicsc webs,Lc. "For more Wnor malon. Pes e hs eSLS for this review at the regional and global levels, as well as in The Global EtCr..r.,nnen C'uric, 2i)'j -hf hrip ,..r.ei c-rg'g)eo2000und. ensuring that the environmental dimension of sustainable de- The "Malr D-.-.r,. - rr.j. .-r-- I:.;.m ilm.: m.r:rerial himi velopment is fully considered on the basis of a broad assess- Rio Print-ir . -= (http:fI' - -..-, r1ccne, .1.eII :cp'd.: :u.ccd='6&wsiticid= 1 163, ment of the state of the global environment. Universal Jr,r,r r: Hc..;r. i: - . I-rEr . . - .... c. C.-.r. Es 3ier i .T.,I ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) F The protea is South Africa's national flower occum.ng in the Fynbos of the Cape Floristic Province. s we look back over Can the environment centrated in areas of curreritpopula- the past years and *tion settlement, andi particularlv in / \ ~ahead to the news mil- Wait? environmentally stressed seaco'asts ~~~~~enu,wesera The last decade has brought incredible an rie valleys. _ _ ~~sons for both distress * While environmental health risks are and hope for the future. Fnvironmental avneintcolgadcmui- greatly reduced in thle dleveloped trends on the ground, especiallv in the caios bu f.ldt unaon world, they still cause nearly 20 per- negative trends in the environment, cn ftebre fdsaei h developing world, remain alarming. epcal ntedvlpn ol.cn ftebre fdsaei h Driven bv population growth and ris- dvlpn onre.Tecue n clude lack of access to safe drinking ing production and consumption, pres- * Global population is now about 6 bil- water, high levels of indoor and out- sures on natural resources continue to lion and is heading for 7 billion by door air pollution, unsafe use of agro- increase. At the same time, public 2014. Of that extra billion, onlv 30 and industrial chemicals, and vector- awareness of the risks of environmen- million vvill be in the world's high- borne diseases (malaria, dengue fe- tal degradation is growing, and there are income countries. More than half of ver) linked to environmental prob- signs that a new working partnership- the next billion will come from South lems. Iovernment, business, and civil soci- Asia (310 million) and Sulb-Saharan * Natural resources are urnder great ety-is emerging t'or the promotion of Africa (240 million).4'he next billion pressure. About 20 countries, prima- sustainable development. people will be primarily urban, con- rilv in the Middle East and Africa, are 6 ENVIRONNI\FNfMI' FMFlrlRS1 * 2(10(1 Overview classified as water-scarce or water- Building a sustainable their recent report on Meetinig C1.. Q'-0 stressed. Forests are disappearing at Expectations: Corporate Social Responsibil- a rate of about 100,000 square kilo- woria ity, the World Business Council for Sus- meters per year. Nearly 70 percent of The most fundamental environmental tainable Development and its members the world's fisheries are overex- management constraint the world faces have responded positively to the in- ploited. Soil degradation affects more is not lack of resources, but lack of lead- creasing calls for business to assume than 900 million people in 100 coun- ership. During the past year, the most wider responsibility in the environmen- tries, and about 1.1 billion rural vocal voice for the environment came tal Fian Cr ankis playin people are at risk from desertification from the citizen on the street, notably in ' ~~~a lead role in this effort, as described in and dryland degradation. Seattle and Washington. The globaliza- this issue, and the Bank itself is actively U Natural and man-induced disasters, tion debate has focused environmental this to andlthe Baitself ivate- which have often been front-page activism and brought it to the fore in the working to facilitate sustainable private- news in the last couple of years, media and around the conference table. maintained their high frequency. In Environmental activists have put a In this redefined stakeholders triangle, Bulgaria, my native country, unprec- healthy heat on multilateral organiza- governments, both nationally and glo- edented heat waves caused wide- tions, including the Bank, to intensify bally, need to adjust to new divisions of spread forest fires. Globally, disaster our efforts to develop better tools for accountability and power, while retain- losses increased from $71 billion in global environmental governance. ing their critical role in providing a level the 1960s to $608 billion in the 1990s. the general public playing field for all and ensuring that The average costs of natural hazards Apartnfro activits, s the rules of the global economy are just increasingly supports strengthened en- adtebnft r nlsv.Smlry as a proportion of GDP are 20 per- vironmental management. Sample sur-benefits are clusve. Smlarly, cent higher in developing countries veys around the world show there is a terational organizations, which used than in developed countries, suggest- clear consensus for stronger environ- to be a forum for governments, need to mg that lagging development and mental laws and regulations, which pro- adapt to these changing realities, and poverty tend to greatly amplify their vides hope that stronger political may emerge wit of mandates and impacts. If these short-term climate leadership on the environment may issue we have asked two distinguished variations are actually related to emerge (see Box, page 8). Since the experts-Daniel Esty and Calestous long-term climate change, they pro- United Nations Conference on Environ- Juma-to discuss the pluses and mi- vide terrible examples of what the ment and Development at Rio in 1992, nuses of creating a new global environ- future might look like if the world civil society has matured and today mental organization. fails to curtail its carbon dioxide plays an integral part in the governance emissions. process; important decisions now re- Th of quire wide consultations with stake- The role of the Bank Almost as shocking as these environ- holders. As part of this process, the Bank In this context, what are the key contri- mental horror stories is our abysmal ig- has built solid working relationships butions the Bank can make to help build norance of what we are doing to the with many development NGOs and a more sustainable world? As a devel- world's ecosystems. World Resortrces worked to maximize stakeholder par- opment institution, our overarching 2000-2001, in which the Bank is a part- ticipation in Bank projects. concern is not lending more money, but ner tries for the first time to gauge the T r helping countries make the policy and e te or The role of busess has also creased. institutional choices that benefit poor health of the world's croplands, forests, There is a legitimate demand from com- people most and facilitate equitable and coastal areas, freshwater systems, and munities, employees, and consumers sustainable growth. grasslands. (For a brief summary of the that the business community should results, see the inside front cover.) This take on social and environmental First, the Bank sitpports a loing-term view Pilot Analysis of Global Ecosystems will responsibilities on a par with their grow- of developmenit. We must be careful not be followed by a more comprehensive ing role in the economy On the corpo- to fund initiatives that bring people out Millennium Ecosystem Assessment, rate side as well, more environmental of poverty today, only to put them back which is already under way. and social responsibility is emerging. In into poverty within a generation be- ANNUAL REVIEW * JULY I99E--1UNE 2000 (FY2000) 7 Sample surveys of public opinion on the environment in 30 countries have found relatively high levels of concern in most countries, but somewhat different perspectives between the more affluent countries of North America and Europe and developing nations. In China, 40 percent of respondents mentioned the environment as among the nation's most important problems. Other countries where the environment is named by 15 percent or more included Australia, Finland, Germany, Great Britain, India, Japan, Korea, Kazakhstan, and Russia. In eight countries mention of the environment has increased since 1992; in seven, it has decreased. There is a clear consensus among citizens around the world that environmental laws and regulations, as they are now applied in their countries, do not go far enough. Majorities of people take this view in 27 out of 30 countries surveyed. The survey found significant differences in priorities between countries with higher and lower per capita income. In countries where purchasing power is high, people are overwhelmingly most concerned about the effects of pollution on the world as a whole. In the 10 countries with the highest per capita purchasing power, 68 percent are most concerned about environmental effects on the world as a whole. This proportion drops to 52 percent in countries with medium purchasing power and 39 percent in countries with the lowest per capita purchasing power. In wealthier countries, people tend to take a more long-term and global view of environmental pollution. Since national and local pollution laws are more stringently enforced. concerns about local air and water pollution are more muted. In poorer countries, the survey found that environmental concerns are often much more immediate and locused on such issues as the safety ol local water supplies and air pollution from local factories. The findings of the 1998 Environmental Monitor survey are based on interviews with about 1,000 citizens in each of 30 countries on all continents. The survey was managed by Environics International Ltd., which vwas assisted by research institutes in many of the survey nations. Source: Environics Internalional Lid. 1998 The Enroronmenral AMonaor, Giobal Publhc Opinion on rhe Entironmeni Thronic. cause we did not foresee the long-range quires support for environmental poli- eign capital are unlikely to be sufficient depletion of natural capital. Overcom- cies, regulations, and enforcement to to fund environmental services and fuel ing the shortsightedness of political and ensure that environmental externalities the engine of growth. business institutions is a key challenge (both negative and positive) are inter- of sustainable development. This is also nalized, and that new markets are Fifth, the Bank must promnote partnerships a challenge for the Bank. It requires rais- created to service the needs of the envi- and participation. We can go a lot further ing the Bank's planning horizon to re- ronment. As described in an article in by increasing the participation of af- flect long-term environmental concerns. this issue by Stefano Pagiola, the Bank fected people in the decisionmaking and is assisting several countries in devel- development process. The Bank can also Second, the Bank can help couintries nman- oping systems of payments for environ- multiply the effectiveness of its assis- age the entironirterital rlsks of ecoBnouldc mental services. tance if it works in partnership with develop7nent. Internally, the Bank should e se v ces. others toward common objectives. De- support better environmental assess- velopment agencies, bilateral donors, ments; improved design of projects, Fourth, the Bank must cgontinvue to make the civil society, the private sector, and oth- policies and programs; and monitoring case for and support good environmental ers can work together to bring positive and improving the environmental per- governance. Modern societies are increas- environmental outcomes on the ground. formance of its own projects. Externally, ingly complex. They cannot function Partnerships allow selectivity and in- it should help build the environmental effectively and sustainably in the ab- creased effectiveness based on the capacity and performance of develop- sence of an equitable legal framework comparative advantages and relative ing countries. based on a consensus of opinion within strengths of each partner. the community and a competent and Thlird, the Bank can help markets 7vorkffor impartial civil service to administer the Sixth, tihe Bank can promiiote international the environment, not against it. This re- law. In their absence, both local and for- and global environmiiiental policy dialogue, 8 ENVIRONMENT MATTERS * 2000 Overview help raise awareness, and butild consenzsus. the phaseout of ozone-depleting sub- This new strategy will (a) outline an The Bank assists developing countries stances, biodiversity conservation, agenda of high-priority areas where to implement international conventions greenhouse gas reduction, and protect- there is a strong potential for impact on and can facilitate effective resource ing international waters. Two innova- the local, regional, and global levels; (b) transfers from the developed to the de- tive programs-the Critical Ecosystem build awareness and understanding of veloping world for measures with re- Partnership Fund (see page 60), which poverty-development-environment gional and global benefits. Moreover, we focuses on biodiversity, and the Proto- links among the Bank and client coun- can make the case that well-targeted type Carbon Fund (see pages 58-59), tries; (c) begin to define long-term goals interventions in environmental manage- which focuses on carbon markets-are and short-and medium-term perfor- ment and pollution control can leverage just getting under way. mance benchmarks, which shift the both local and global benefits. We have focus from inputs and processes to out- an important role to play in facilitating Toward a new comes and provide a transparent basis communication between developing to evaluate the World Bank's environ- and developed nations, so they can bet- environment strategy mental performance; and (d) promote a ter understand each other's priorities long-term partnership with client coun- and unite them in a common environ- While the Bank has evolved as one of tries and other donors. mental agenda. the international organizations commit- ted to environmentally and socially sus- We hope the new strategy will drive a tamnable development, we still have a Investing in sustainable long way to go to mainstream environ- strong environment agenda in the Bank ment in all aspects of Bank operations. mn. Our goalt s o rea op+1na For the environmental community of - a leader on sustainable development, We are striving to ensure that our ana- the World Bank, the recognition of the a pron sustme seelout lytical work and investment operations challenges ahead has triggered the th aipr ovenromim nt out fit these broad objectives. We have a to- preparation of a new environment strat- cthe instiuon,the govern wof tal of 97 stand-alone environmental egy that will better align management are incernect endiothersw projects totaling about $5.1 billion, and of the environment and natural re- a large number of sector projects with sources with poverty reduction and sus- sues and make their voices matter in primarilygenviberonmsenta objectives wl tainable growth. The key development defining the policy and investment de- primarily environmental objectives objectives of the strategy are to: cisions of the World Bank. amounting to $10 billion (this portfolio objectives of the strategy are to: is described in more detail in the article U Improve people's health by reducing that follows; many of these projects also their exposure to environmental risks are described in the regional reviews in such as indoor and urban air pollu- this issue). tion, water- and vector-borne dis- eases, and toxic substances. Important lessons have been learned in U Support the sustainable management recent years. For example, in natural of natural resources-land, water, resources management, community- forests, and biodiversity-to enhance based forest management can success- poor people's livelihoods today and fully target the rural poor. In the water in the future. resources area, we see success in efforts U Reduce people's vulnerability to en- vironmental risks such as natural di- to promote regional and national water resources planning programs. The Bank sasters, severe weather fluctuations, ,. and the impacts of climate change. is also taking an active role in assisting nations to reduce their vulnerability to E c o Extensive consultations on the new - - - natural disasters. strategy with clients and partners are Kristalina Georgieva is the Director of the under way; a final draft of the strategy Environment Department for the World Bank We are also working with our clients on is expected by early in the next calen- and the first developing country national global environmental issues, such as dar year. (Bulgaria) to hold the position. ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 9 Mainstreaming the Environment - Progress in Greening the Bank's Portfolio ver the last several years, the World Greening the Banles Q | Bank has been using its investment r portfolio and technical assistance to porLiollo strengthen the integration of environmental issues Lvirnniental Assessments. All Bank projects have into the development process. In addition to en- . . s to be screened for potential environmental im- vironmental assessment procedures and targeted pacts. This requirement has helped to minimize environmental interventions, the Bank is now potentially negative environmental impacts of moving toward greening its entire portfolio Bank projects. Over the period from 1990 to 2000, through a growing number of sector projects, 210 projects-about 14 percent of the Bank's lend- which include envirornental components or in- ing portfolio (by lending amount)-were corporate environmental classified as Category A, which requires a full en- considerations into project vironmental assessment. Another 1,004 projects- Distribution of Targeted Environmental design. about 35 percent of Bank lending-were classified Lending by Key Areas as Category B, requiring a more targeted or lim- GJUM MP Nalu Jl Rr: E ited environmental analysis. The rest of the port- Runi Ff., Mgi Environmental folio (51 percent) had no environmental impact, portfolio and therefore required no environmental analysis. I. _ At the end of fiscal 2000, - v there were 97 active envi- In fiscal 2000, of the 223 new Bank projects, 18 Phvui,on d .- ronment projects amount- were classified as Category A and required a full Urb En . - ing to $5.16 billion. In environmental assessment. This represents 15 r.irl.ir.raI addition, there were nu- percent of all new projects, or $2.3 billion in lend- --'_8. merous sector projects ing. An additional 82 projects-31 percent of all new projects, or $4.8 billion in lending-were clas- winthl prjectimar e rount- sified as Category B and required a simpler envi- mental objectives amount- ronmental analysis. ing to $10 billion. This "broad" environmental portfolio, which totals $15 billion in lending, con- Mainstreaming the sists of projects with clear environmental objec- tives in the area of pollution management and environment urban environmental priorities, natural resource mrbanagemen environmental capac buidn In addition to the portfolio of projects targeted mandaglobalt environmental ssues. y building, specifically at improving environmental manage- ment, a growing number of other sector projects include environmental components or incorpo- In fiscal vear 2000, 13 new environment projects icueevrnetlcmoet ricro In fiscl yer 200,3nwenironentprojcts rate environmental considerations into the project were approved, totaling $515 million. In addition, design. As described below, there are many ex- there were over 30 new projects in other sectors with amples in sectors such as rural development, ur- primarily enviromnental objectives amounting to ban development, water supply and sanitation, over $1 billion. Thus, environmental lending for and energy. projects approved in fiscal 2000 amounts to almost $1.6 billion. This accounted for 10 percent of total Reiral Development. In the Bank's portfolio of ag- Bank lending in fiscal 2000 ($15.3 billion). riculture and rural development projects, increas- 10 ENVIRONMENT MATTERS e 2000 All Bank Projects, by EA Category, 1990-2000 lines for the urban ciency Project will support the sector, as well as Ukranian government's energy conser- 350 environmental vation program through energy effi- codes of practice ciency improvements in institutional 300 regarding solid buildings. The Second Renewable En- U 250 _ waste manage- ergy Project in India aims to promote n 200 ment. energy efficiency and demand-side o U50 t * - - - - - - t t * management (DSM) investments. E~~~~~ * ~~~~~~Water supply and z F U saniitation. The The Bank is also supporting cleaner en- Bank's portfolio of ergy alternatives such as natural gas, as o a J a S a X J a a J water supply and well as renewable energy sources such 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 sanitation projects as solar, wind, and geothermal power. focuses on expan- The Podhale Geothermal District Heat- Oe **Category "A sion and upgrad- ing and Environment Project aims to ing of water sup- reduce air pollution from local coal-fired ply and sewerage systems. Most of the space-heating boilers through the in- ing emphasis is being given to sustain- 15 projects approved this year have pri- creased utilization of geothermal heat able land resource management through marily environmental objectives. and natural gas in the Podhale region appropriate soil and water conservation of southern Poland. measures. In China, the Hebei Urban Environ- ment Project will support Heibei Prov- Future challenges Irrigation and drainage projects are fo- ince in implementing a long-term urban cusing on improved water resources environmental services improvement Looking toward the future, the Bank will management measures that address program to recover from the environ- continue its effort to mainstream envi- problems of water scarcity, water qual- mental degradation of its water and ronmental issues into the entire Bank ity, and salinity; examples include the land resources, provide an adequate portfolio. There are several priority ar- Ceara Integrated Water Resource Man- supply of safe water, and ensure eas, including the need to (a) identify agement Project in Brazil and the Wa- sustainability of delivery. In the Domini- indicators that can measure the environ- ter Sector Investment Project in Tunisia. can Republic, the Wastewater Disposal mental outcomes of Bank projects; (b) In Georgia, the Agricultural Research, in Tourism Centers Project will apply continue to mainstream environmental Extension, and Training Project pro- innovative technology for environmen- components into all Bank projects; (c) do motes the adoption of technologies that tallv sound disposal of treated waste- more cross-sectoral work, which can increase sustainable agricultural pro- water in coastal towns. The Tehran identify ways to build in local and glo- duction and reduce pollution of natural Sewerage Project inlran will finance the bal environmental benefits in Bank resources. installation of wastewater collection and projects; (d) intervene at an earlier stage treatment facilities in order to improve in project preparation to identify poten- Urbani Devceloprnent. Several urban public health. The Second Community tially adverse environmental impacts; projects have focused on improving en- Water and Sanitation Project supports (e) use environmental assessments more vironmental services. For example, the the Government of Ghana in extending strategically; (f) sharpen the Bank's abil- Sichuan Urban Environment Project in sustainable water and sanitation facili- ity to identify environmentally prefer- China is a comprehensive urban envi- ties to 85 percent of the rural popula- able alternatives in projects; and (g) ronmental services improvement pro- tion by the year 2009 and in establishing better integrate environmental consid- gram designed to reduce degradation of a sustainable operations and mainte- erations into Country Assistance Strat- water and land resources; provide an nance system in rural communities and egies, Poverty Reduction Strategy adequate supply of safe water to small towns. Papers,sectoralstrategies,andtheCom- Sichuan's growing urban population prehensive Development Framework. and economy; and maintain the water Energy. Many Bank energy projects are quality of the Yangtze River. promoting energy efficiency through institutional and pricing reforms, as well In Bhutan, a component of the Urban as demand-side and supply-side energy This article was prepared by Anjall Aciarya of Development Project will support the efficiency components. For example, the tlue Environment Departnient, (202) 458-5298, development of environmental guide- Kiev Public Buildings Energy Effi- fax (202) 477-0565. ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY200C) 11 any of the crit- given sufficient weight or M \ s Eical environ- attention in international mental issues affairs. In this context, facing the world are either some have suggested cre- f n t ern a tiX o n a truly global in nature, such ating a global environmen- as climate change, or rise tal organization or agency to the level of global im- with some form of regula- G overnance at portance, such as loss of tory or enforcement capa- biodiversity and manage- bility. This new agency, the Q lobal Level ment of large water sys- which has received some tems. There are numerous high-level support recent- conventions and other in- ly, is sometimes men- ternational agreements ad- tioned as a potential coun- dressing such problems, terpart to the WTO. frequently developed un- AM _ j wder the auspices of the The possibility of such an _ -. United Nations Environ- organization has consider- ment Programme or other able relevance for the - . i parts of the UN system. Bank's clients, given the ef- - The reality is, however, forts that are being made -,that progress on dealing by the Bank and others to IKIr suppor~~~~~ofe so, epieth e-n tioa srengulatory and -- -. ~ -~ ˘with these global issues is support strengthening of - r , , . , ~~national regulatory and - ~~~~~~~~~~often slow, despite tnie re- sources provided through compliance capabilities. In .. < . * -;4:; i-" ~sources provided throughthpaetatflo the pages that follow, bilateral aid or multilater- al facilities such as the Glo- fored ators, (GEF) or other agencie. -formed commentators, _.-- B v .. - _:J1 ~~~bal Environment Faclt K!, .-blEvrnetFcility Daniel Esty and Calestous J g {-; ^ ~~~~~(GEF) or other agencies. YitiU The recent Malmo Decla- ration from the world's viewpoints on this issue. S +.t t ~~~~ration from the world's environment ministers This is an issue for govern- _ - _ stressed the need for rein- ments to decide; the Bank vigorated international itself has no position. No Kcooperationbasedoncom- matter how the discus- mon concerns and a spirit sions on an international -: of international partner- agency evolve, there is a - ship and solidarity. clear need to continue to build leadership and 3- _ An underlying concern support for responsible A- - 'about globalization is that management of key envi- A forest fungus in the biodiversity-rich Andries Vosloo Kudu Reserve, SoLrtI the environment and so- ronmental issues at the in- Africa. cial dimensions of increas- temational level, as articu- ing trade, investment, and lated by UNEP's Malmo exchange of ideas are not Declaration. 12 ENVIRONMENT MATTERS * 2000 The Value of Creating a Global The Perils of Centralizing Global Environmental Organization Environmental Governance Daniel C. Esty Calestous Juma Q ~ lobal efforts at environmental protection are bogged A dvocates of a new Global Environment Organization down in part because of a weak institutional struc- (GEO) allege that global efforts to protect the envi- ture. It is time to get serious about revitalizing the in- ronment are stalled in part because of weak institu- ternational environmental regime and to consider creation of a tional structures. They speculate on the significance of institu- Global Environmental Organization (GEO). tional problems and provide no evidence to support the view that environmental conservation will be improved through the The suggestion that we focus first on strengthening national- creation of a new United Nations agency. A viable proposal for level environmental programs misses the point. A significant a new agency requires a clear and compelling organizing prin- number of pressing pollution control and natural resource man- ciple, credible design concept, and realistic implementation plan. agement issues are transboundary in nature and cannot be ad- They offer none of these. Instead, they rely largely on arguments equately addressed by domestic environmental laws and based on administrative efficiency. projects. Moreover, in the context of a globalized economic struc- ture and multinational corporations, national governments can- First, they attribute lagging global environmental efforts to the not address the challenges that exist on their own. Basic fact that environmental tasks are fragmented and performed economics teaches that public goods by too many uncoordinated agencies must be provided at the scale of the W|P Ei1N 77 and treaties. Second, they bemoan the issue to be addressed. When prob- 0 1 N IFS lack of enforcement mechanisms in lems are worldwide in scope-from most existing treaties. Third, they say a thinning ozone layer to possible climate change to depleted the agency would help transfer environmental technologies and fisheries in the oceans-the response strategy must be construct- finances to developing nations. And finally, they appeal to the ed at the same scale. need for a body that would serve as a counterweight to WTO. None of the reasons has a sound basis. There is no reason a new Global Environmental Organization would need to be a big bureaucracy. The best approach to revi- It is true that transboundary environmental problems-all of talizing worldwide environmental protection efforts would start which have national sources-require concerted international by consolidating a number of existing UN agencies with envi- action. This is already being done through a number of interna- ronmenta. b t a m tional treaties and organizations. Anew agency will not replace rnetal responsiblities into a streamlined new body with a existing efforts but will add another layer of bureaurc toa decentralized (and largely virtual) structure that draws signifi- exsi efforts butwill ad ather aye oreaucracyoos a cantly on outside expertise (NGOs, academics, and the busi- ness community). When it comes to global environmental Here are a few examples. Acting against global warming re- governance, we know that "less is more." In fact, one of the UN quires national action to meet commitments under the Kyoto Environment Programme's core problems is that it tries to do Protocol; a new agency will add little to this process. Setting too much. It should quit being a program agency and narrow standards on marine pollution should build on the work of the its focus to fostering collaboration on issues that are inescap- International Maritime Organization. Setting environmental ably international. standards for products should be guided by the pioneering work of the International Organisation of Standards. Promoting guide- Fragmentation of responsibilities, funding, priorities, roles, ac- lines for ecosystem management should support the work al- tors, and geographic locales is a central weakness of the current ready initiated under the Convention on Biological Diversity. environmental regime and leads to environmental initiatives Environmental impact assessment activities in institutions such environmental regime and leads to environmental initiatives as the World Bank should be given greater legislative authority. that are less coherent, effective, and systematic than needed. There are numerous other efforts that need to be supported and Beyond the competition between UNEP and the Commission strengthened, not denigrated. on Sustainable Development (CSD), there are a serics of envi- ronmental treaty secretariats (Biodiversity in Montreal, Climate The assertion that consolidating existing international organi- Change in Bonn, Hazardous Waste in Geneva) that compete for zations and secretariats of conventions will result in a stronger ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 13 The Value of Creating a Global Environmental Organization (continued) resources and attention. In addition, there are more that a doz- age our ecological interdependence. Without a concerted effort en other international bodies, such as the UN Development Pro- to address transboundary pollution spillovers systematically gramme (UNDP), the World Bank, the World MeLeorological and to utilize the shared resources of the global commons Organization (WMO), and the Global Environment Facility responsibly-or as economists would say, to internalize (GEF), that play some role in international environmental pro- externalities -we risk market failures in our international eco- tection. These wide-ranging efforts are now poorly coordinat- nomic exchanges, reduced gains from trade, and diminished ed. There is little effort made to set priorities systematically or social welfare, not to mention environmental degradation. to ensure budget rationality, never mind achieve the full range of synergies that should be possible. The existing international environmental regime is listing bad- ly and cannot be righted. It is time to design a new, sleeker, and The concerns addressed by these many bodies is diverse. But more efficient craft that can get us where we need to go. The the response to the diversity need not be disorganization. A care- "Rio+10" Conference contemplated for 2002 would be a good fully constructed institutional design that offers a coherent and target launch date. comprehensive response to worldwide environmental problems has much to recommend it. Dissipation of focus, competition for limited resources, bureau- f ; cratic infighting, and poor coordination among the core envi- ronmental bodies, which stretch from Nairobi to New York, squanders already limited resources. Thinly staffed develop- . . ing countries in particular cannot keep up with the sweep of l cnvironmental entities, meetings, and activities spanning thesg planet. Consolidation of the range of international environmen- - *- - tal programs in a single city, combined with a decentralized structure of support, would greatly enhance efficiency and multiply the opportunities for learning across issues. Climate - change strategists, for example, may well find strategies for bet- ter coordinating worldwide efforts to combat greenhouse gas emissions in the ozone layer protection experience. There are, moreover, real synergies to be obtained by linking related is- sues and initiatives. One of the most urgent reasons for establishing a Global Envi- ronmental Organization is to relieve the stress on the WTO that arises every time the latter reaches beyond its core trade com- petence to take up issues in the environmental domain. Inte- grating economic and environmental policies represents a critical challenge. But however desirable, a "greener" GATT is no substitute for a functioning international environmental regime. The call for a Global Environmental Organization-which has Mountain range, Ian Jaya. come from French Prime Minister Jospin, French President Chirac, former WTO Director General Renato Ruggiero, The Economist magazine, and many others-stands out as an effort Daniel C. Esty is a professor of environmentta lanv and policy at tlle Yaile Lawt Schzool anid the Yale Schiool of Forest n,1 and Enivironmiiental Stutdies. He to make sense of the realities of globalization. The underlying is also Director of the Yale Center for En viroiiiiienmz a Lav ental aPolide and logic is crystal clear: we need to find thoughtful ways to man- Associate Dean of thle Yale Schiool of Forestry and En2viroiiinmenttal Studies. 14 ENVIRONMENT MATTERS * 2000 The Perils of Centralizing Global Environmental Governance (continued) and more effective agency is based on a misunderstanding of the richer nations have not honored their commitments to as- how international bodies function. Secretariats of conventions sist them with technology and finances. There is no guarantee and international bodies receive their instructions from their that the new agency will perform better in this regard. governing bodies. Administrative efficiency should not be con- fused with programmatic coherence. Secretariats of conventions In addition, developing nations have consistently argued that cannot be combined without the approval of their respective environmental conservation should be promoted as part of their governing bodies. Advocates of the new agency have not indi- overall economic goals, as agreed at the 1992 Earth Summit in cated how they plan to deal peacefully with the divergent gov- Rio de Janeiro. Creating a new agency focusing on environment erning bodies. over development, as is proposed, would amount to reneging on this historic agreement and will antagonize developing The perceived competition for finances is in part a result of tlhe countries. failure by many governments to pay their dues, which is often prompted by concerns over bureaucratic inflation. There is no The WTO is fundamency wed The as undoubtedyeeds the WTO is fundamentally flawed. The WTO undoubtedly needs evidence that the situation will be different under a new orga- to take environmental issues seriously. WTO's Committee on ization. Furthermore, many of the agencies dealing with envi- Trade and the Environment needs to be strengthened, and en- ronmental issues focus on distinct but complementary functions ironmental treaties should have umbrella observer status in that should not be collapsed under one behemoth. the organization. This will help to contribute to the appropriate integration of environmental considerations into the function- But more importantly, environmental problems are diverse in ing of the WTO. Deciding on how to deal with the workload in character and require specialized institutional responses. Where the WTO is a matter that is internal to the organization and coordination is needed, governments can do that without cre- cannot be solved through a separate regime. ating a new bureaucracy. There is, however, an urgent need to share experiences and lessons, codify principles, promote guide- Unfortunately, the debate on creating a new agency diverts at- lines, and set new standards. But this is just what global trea- tention from more urgent tasks. All nations need to do more to ties on climate change, biological diversity, endangered species, meet their obligations under international treaties and must do and control of desert growth were created to do. Many of them this without delay. Much of this involves domestic efforts to cut are already doing this without the perils of centralization. pollution, protect wildlife, conserve soils and freshwater, and promote investment in environmentally sound technologies. It is true that most environmental agreements lack effective en- Industrialized nations should also meet their international com- forcement mechanisms. One of the reasons is that govermments mitments by sharing experiences and forging technology part- cannot agree on how they should work. Drawing on their experi- nerships with developing nations. ences with the World Bank and the International Monetary Fund, many developing countries are concerned that a new environ- Arguments for a new agency that are based on administrative mental agency would only become another source of conditions efficiency point to an urgent need to improve the functioning of and sanctions. WVhat is needed is greater support for research, existing bodies, not create a new one. Tackling the world's en- training, education, and public awareness in developing coun- vironmental problems calls for urgent action, especially at the tries in keeping with the Earth Summ-nit cominuitments. national and local levels. There is no time to waste on launch- ing a costly, politically divisive and bureaucratic structure with no compelling organizing principle, clear design concept, or More needs to be done at the national level. If governments pro- realistic .plan mote greater compliance with domestic environmental laws, realistic plan. they will find it easier to reflect this in global efforts. What is perceived as deficient global environnental regulations is real- Calestous Juma is Director of the Science, Technology and Innovation Pro- ly an indication of poor domestic housekeeping. gram at Centerfor Intternational Development at Harvard University and a Senior Research Associate at the Belfer Centerfor Science and International Affairs at Harvard University. He isformer Executive Secretary of the United Most developing nations cannot meet their obligations under Nations Conzvention on Biological Diversity andt U.,;, Executive Direc- various environmental treaties. They say this is partly because tor of the African Centrefor Technology Studies in Nairobi. ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 15 1-F L- . 1 Z .tLi i l- nitions of corporate respons- IFC L O tILt t _ I I _i i I I ibility. Corporate environmen- L--i II c _ -h I'.I 1 IcI-rcc- tal and social values have to be - i lrl .i lb11!. pi -redefined alongside tradition- o rp" o ra t e ; t* : t.,. -iAtl 3f t,:.,.!l tit al values such as profitability, r -LIIt.Ib L.Li L' \ CL P!IItt t i Vhc and integrated even more lck:tIll tI t !S; t.l; deeply into the heart of strate- k\:izhzo4t,hn n gic thinking and everyday .tzs i i ac.*8 ;1n Fi itL!; .-- ,! practice. Rapid communica- - 11k- L', II,1 .. !ct'. tI, 1isIII tions in the "global village" ~~~~~~~~~~~~~~40 l oJ s zd,|-rn1l!1 1v !t.l.lll mean that companies'environ- C/i' Iob,alizedn iuiiiLi" - . I.b,I It : L-.! .t mental and social performance tiflt 1: fl lz 81ll \ ! 11 L-u is under ever-greater scrutiny E con om y -11:,i L-bIL:' Li2. elil'll- t Ill'!LI from an ever-widening audi- ILI t bJ 1itz h, l,llot, ib, ence of stakeholders. In turn, cAoLljt-I I/it!/fa l I sti i c:iiL -,n- this acts as a driver for new i'. 'IUi1l:l'It.-rI '1.'. el r models of assurance, account- _,.~ .)1 ability, and partnership. Mul- /IFC S R o/ei1( ioI r ! lit:i I \' ..t I I t "k- II! . I tinational operations and the n;.:lt. 3 COIIiilI?It. :!;! !t, ,p-l demands of the global custom- lPr'oinofiltl vl. !.icl ii '.; tIC- er mean that national regula- li.llil. Li' ii.iVIp.llre.l l:;l Ch. tory systems alone can no .Sustdildble /Privdte tlllk-- II tLIv.'. !-, longer provide the sole basis I.'!I t :. h'. tlL! Ilt ii,. JI :!. for corporate environmental Sector /17vestInelte t 'tcl, I I [ and socialmanagement; global standards of best practice are ,-.I 5.'i3LiI';t-l -__ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ __ r 'also needed, and these must combine international credibil- il: t r3 1 ll t! I 1 .1 | i |! 1.; . itv with local practicability. b.' LI' t c1 Uill Cl.lPk v IFC's leadership role -l - L- I !lfz 1 Il, I ch v : !]-. 11 C'I,,Ž h .|_r,p- > . th, 'w 1 iilti~ -The International Finance Cor- -.- -- E _i_ g ~. -- poration (IFC) has an impor- tant opportunity and respon- sibility to help address these vital issues. As the World Bank's private sector invest- e ,, e, , , -t -- - 8 s ment arm, IFC has established a leadership role in the drive for sustainable and equitable private sector investment in *- g - * - A. j '* ,,g,; the developing world. We are V .a . -=J .. committed to promoting sus- !Pi~T F, j-'- ' . ,. tamable projects in our devel- oping member countries that are economically viable, finan- 3_.__________________________________ _ cially and commercially Senior managers from banks and investment funds receive training on environmental and social risk management through sound, and environmentally IFC's Competitive Environmental Advantage Workshop, delivered by the Environment Division's Financial Markets Unit. and socially responsible. 16 ENVIRONMENT MATTERS * 2000 Global standards standards. Increasingly, how- IFC's capacity-building goal ple, IFC finances projects rang- ever, we are seeking to move goes further than this: we also ing from renewable energy to and best practice beyond this "do no harm" phi- help them to integrate environ- clean water supply using its IFC's environmental and social losophy. Project sponsors are mental risks into their invest- own resources as well as con- poliCies andimenalianes siave now routinely encouraged to ment analysis, and to consider cessional funding from sourc- policies and guidelines have consider broader environmen- environmental and social is- es such as the Global En- been developed after extensive tal and social goals that go be- sues as an opportunity for vironment Facility (GEF). IFC peer review and draw on best yond immediate mitigation competitive advantage and has a catalytic role in support- paciey wide eerienge aofisc measures, such as pollution added-value. For example, an ing smaller market-oriented a very wide range of dtsci- control equipment. An exam- IFC-backed private equity environmentalprojectsthrough plines. Not only do they pro- ple is Favorita Fruit Company fund in Chilc has been able to facilities such as the innovative vide a rigorous framework for in Ecuador, whose subsidiary help one of its portfolio com- IFC/GEF Small and Medium IFC's own investments: they Reybancorp recently became panies (a juice and wine pro- Enterprise Program. Looking are increasingly being seen- the first banana grower in the ducer) to include pollution to the future, IFC will contin- and used-as a model of best world to receive the Rainforest control and eco-efficiency mea- ue to pursue new ventures, practice for the private sector Alliance certification of com- sures in its expansion and such as projects that mitigate generally, even where IFC has plete compliance with rigor- modernization program. Not climate change pursuant to the no direct role. ous environmental and social only does it now comply with Kyoto Protocol-including standards. Chilean EHS regulations, but potential opportunities to de- IFC will continue to play an the company is now aiming to velop funds that invest in important part in the develop- Roughly 40 percent of IFC's have an ISO 14000 environmen- greenhouse gas emissions ment of global standards and development funds are now tal management system cover- reduction. best practice. We view this as delivered via financial inter- ing its plants and suppliers. a significant development role mediaries such as banks and IFC is also seeking to expand for IFC. Our dialogue with oth- private equity funds. We work Innovative irojects into new and innovative sec- er multilateral organizations, closely with them to ensure r tors such as private-led health governments, and export cred- that the projects they finance IFC also invests in projects and education. For example, in it agencies forms an important meet applicable environmen- with specific environmental Kenya, IFC has helped an en- part of this activity. During the tal and social standards. But and social benefits. For exam- trepreneur to provide private past year, IFC has played a key health insurance to employees role with other international of local businesses. But the financial institutions to map FAVORITA FRUIT COMPANY, ECUADOR company's development im- out the environmental and so- pact hasn't stopped there. It cial requirements of each orga- IFC has been an investor in Favorita and subsidiary compa- has alsobuilthealth clinics and nization, with the long-term nies since 1992. This includes a $15 million investment in 1998 services for low-income com- goatlof, movi eong -termrdacom in Reybancorp, Ecuador's second largest banana producer. The munities rovidin services goal of moving toward a com- project centers on the modernization of the company's existing , p s mon set of core principles for seaport facility and expansion of its banana plantations and such as HIV/AIDS testing and environmentally and sociallv production infrastructure. The project was subject to detailed counseling. This IFC invest- s environmental, social, and technical evaluation by IFC special- ment has helped to improve sustainable global develop- ists, and mitigation measures were developed and agreed. In thelivesofnumerousKenyans ment finance. June 2000, Reybancorp became the first banana grower to receive certification under the Rainforest Alliance's "Better Ba- and has an important demon- nana" project. The scheme focuses on environmental protec- stration effect for other entre- IMlalinstreaminig tion, labor standards and working conditions; and sustainable preneurs in the health and environmental and farm management practices such as pesticide use. Certifica- social services sectors. environmental and tion requires independent audits against a rigorous framework of 200 criteria. "When we first obtained financing from IFC, the social issues environmental standards seemed like an obstacle, but we real- Taking on the ize now that they have helped us build a strong business," said All IFC projects are carefully Rafael Wong, ExecOIliVe Vice President of Favorita. "And in five challenges reviewed and monitored to years from now, there will be no access to international mar- ensure that they meet accept- kets for companies that do not show this respect for the envi- One of the responsibilities of able environmental and social ronment. It is becoming fundamental to international trade." leadership is to take on chal- ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 17 | plex partnership than most, *; _ IFC/GEF SMALL but is a stark illustration of 'I AND MEDIUM how our involvement can be ENTERPRISE essential to ensuring that in - __. PROGRAM vestments in challenging sec- tors are not only financially Using $21 million provided sound, but environmentally d' l by GEF, the IFCIGEF Small and socially responsible as and Medium Entearprise Pro- M gralm. has been designed to well. That is our added-value address needs in two key component. areas: climate change (re- newable energy projects or Projects such as Chad-Cameroon projects that remove barriers . . .mpo_a_ce f lis to energy conservation or ilustrate the importance of lis- energy efficiency) and biodi- tening and learning from all versity (those promoting sus- actors in the development pro- tainable use or conservation cess. Often the issues are com- of natural ecosystems). In- , stitutions interested in partic- plex and decisions are difficult. ipating as intermediaries Consensus is not always pos- apply directly to the EPU and sible and, as in this case, IFC can receive up to $1 million and its project sponsors must in long-term loans for on-lending to eligible sub- be as attentive to a project's projects. Since 1995, 19 strongest critics as we are to ture to improve the enabling to redefine our vision of IFC's subloans have been ap- its supporters. environment for private sector roles and responsibilities in proved, encouraging innova- development and to increase sustainable development, and tive environmental initiatives by SMEs in all regions. For The concept of corporate citi- synergies between the Bank's to map out how IFC and example, in Mexico, an inno- zenship must include a recog- private sector regulatory and its partners should move to- vative partnership with Con- nition that organizations have policy activities and IFC's in- wards this 'triple bottom line" Starbucks is slowing defor- certain rights to make careful- vestment activities. As part of approach. estation in the Chiapas re- ly informed decisions on such this process, IFC is re-aligning gion by helping poor farmers difficult issues. However, this itself and has formulated new Globalization means manag- find a market in the United must be balanced by corporate "strategic directions" in areas ing change and we, as much as States for their shade-grown responsibility, including a wdem- anybod must continue to wffee; in Papua New Guinea, wherewealreadyhavea an environmentally friendly commitment to transparency, onstrated competitive advan- learn, innovate, and influence sawmill backed by the World openness, and public account- tage and role. if IFC is to achieve its goal of Wildlife Fund buys logs from ability. These are principles indigenous people, support- .at iesere prinuspes poverty reduction through en- ing sustainable community- that IFC takes very seriously, In particular, we have identi- vironmentally and socially based forestry. as evidenced by the appoint- fied the need for IFC to have responsible private sector ment in July 1999 of the first ever FC/MGA enironen- reater involvement and lead- investment. |ever IFC/MIGA environmen- erhpi utial dv lop lenging projects, for example tal and social Compliance Ad- mer his in undevelop- in sectors such as oil, gas, and visor/Ombudsman, Ms. Meg ment This is underscored by This article is based on the conitribu- mining. Recently, IFC and the Taylor. a clear management commit- tion of Peter Woicke, Executive Vice mining. Recently, Grp r ind ment Taylor. move|IFCtowa President, IFC and Managing Direc- World Bank Group received inment to move IFC towtard a tor, Private Sector Operations, World much attention and criticism more holistic framework for Banik Group, to the UN Millennium due to our review and eventu- l development, recognizing that Snonniiiiit 2000. It lhas been prepared zoith iniputtfromt Dani Siddy of IFC's al approval of the Chad- During the past year, private economic, social, and environ- Finanicial Markets Environmient Ser- Cameroonollpipeline project (see sector activities in the World mental progress are interde- vices Unit (202) 458-7652, fax (202) 974-4384, and Shau'n Miller of lFC's page 32). The Chad-Cameroon Bank Group have beenbrought pendent. We are currently Corporate Relations Unit (202) 473- pipeline involves a more com- under one management struc- engaged in a strategic review 1404,fax (202) 974-4384. 18 ENVIRONMENT MATTERS * 2000 Making progress but I;! - internal qualityassur .nCL processes for both quali- room for ,'r -.ntry and supervision, ihlessons learned from Environmental improvement ,-_ ieviews being used to 1~ h., \\.u! 1 r > !11 1:,! 'l i inp'-ye performance by the 1 d - l ti-i [I It>, t,!t ,t: 1!ll!-l.|; t'5;. _I4-!is. These assessments a Jn d S o c i III ipplr, Ill I- :' -tiown that the overall I I . nii nI t 'I :Ll l . c! k t, - Li,i ItI: of the Bank's portfolio _ I ; i ! C 1, ~ . 1. 1 ;L 1:i1 I t 4`1il lIles to improve and that SarIW fg rd 1 *tlt t illv ironmental and social S afe g u ard m.bht b, n1:. ˘ i, ltr.crd 1 L. dl-ilOlucns are as good as or F,I' tL IIJ,Li Pt: I> it .itu tI'---jI J Lit- rtt-i than other aspects of P o licie' I l e- sI* 11t I 1.,t vI - t -I!Ii . p cojects, although imple- . Ut 'iIAc -:,pta- h .;; t. ilic!-lt,tionandsupervisionare I 1.i, ne-rll -till .i concern. Nevertheless, I nlic performance on safe- 1-.i tI-, Jcit- dl.:.-,d* Wit. K-in :t'i 1 is improving, the h;- lN,Ll ,. nL III il-01% , ; ki, l1 icIn.l. goal of full compliance LO MnIpV' L t ik ,. r. iiJ. :iul it I,t .:,l safeguard policies has Ii 0 ,t II i i ,l - cclvji . not yet been reached. 5lICit:lt Li !'i*t I 'L .. 1 r high-visibility projects, I ib ih IF.1 n1 7 Lia t il Chad-Cameroon Petro- - - in - !'CI I L_ - Il, I e LIn Development and Pipe- J ii. d t h;, t rI I d,-! L, !- I i ne Pioject (see page 32) and P5i-4.L- h1I.-Il ui, ilCi. Ic; th- WVestern Poverty Reduc- thl.- pi . j 14; -L - t, I I. I i h!k It lion Project in China, served ___________________________________ r. c.;e internal and external awareness of the Disclosure Policy Requirement Bank's safeguard pol- Document Format Placement Timing Category A EA Separate Freestanding Disclosed locally and received by Bank before icies and the impor- document appraisal. Once received by Bank, sent to tance of compliance InfoShop unless, in exceptional circumstances, for the World Bank borrower objects. Group's reputation. IBRD Category B EA Separate Annexed to the If a separate document, once received by the document or PID Bank, sent to InfoShop unless, in exceptional section in PAD circumstances, borrower objects. M i tr m IDA Category B EA Separate Annexed to the If a separate document, disclosed locally and compliance document or PID received by Bank before appraisal. Once section in PAD received by Bank, sent to InfoShop unless, in Ensuring compliance exceptional circumstances, borrower objects. with the safeguards Resettlement plan and 'Incorporate" in Unclear: in EA When EA is disclosed. (and with other poli- IPDP (with separate EA) EA or annexed to cies, such as those on EA fiduciary responsibil- Resettlement plan and ities) has been under IPDP (with no separate EA, -------------------------------- Disclosure not required --------------------------------review by Bank Man- e.g., some Category B) agement as part of R ,]k11t f;t. Iv'!-l.;iiHt d |tiM,- :tiledworkingoutofthe I,CeIiI'. -, ii;pil,liC. ith - ii- 1;I z K renewal process and ;IACId 1l-vCtf'- II.- :',ko In :ic al ,1 the broader context of -lij 10 l ''21l! t lt - I: ii, t .! c; -,'!late risk management. 19 Decentralization, both geo- QACT has been significantly vide regular reports to surance activities, focusing on graphical and in terms of strengthened with increased senior management. compliance with safeguard project responsibility, has resources, complemented by a * Participate in a Bank-wide policies and associated disclo- helped to improve the Bank's system of Regional Safeguards process for development sure requirements. The QACT responsiveness to clients and Coordinators (see Box, next of asystemtoidentifyand will also conduct selective the quality of its work. At the page). At the same time, the In- manage "high-risk" and country and sector reviews as same time, it has generated ternational Finance Corpora- "high-visibility" projects well as reviews of high-risk new challenges of ensuring tion (IFC) has continued to in coordination with the projects on an ongoing basis. consistency in the provision of strengthen its capacity for im- ESSD Sector Boards and advice and application of plementation of safeguards, Legal Department. IntegrativJn of Safeg7uard Policies policies. and the Multilateral Invest- * Undertake, in collabora- i7ito Risk Management linitia- ment Guarantee Agency l tion with the World Bank tives. All Bank Regions are un- The balance that has been es- (MIGA) has appointed special- Institute (WBI), a broad- dertaking risk management tablished involves a decision ist staff to address these issues. based program of training reviews at the portfolio and to increase corporate oversight initiatives for Bank and project level to provide World through a stronger central The QACT has a fiscal 2001 borrower staff to better Bank rnanagement with a Quality Assurance and Com- budget of $2 million; expand- I equip them to address mechanism for early identifi- pliance Team (QACT); reduc- ed staffing of the unit is cur- safeguard policy issues. cation of risky projects. This ing the risks of compart- rentlv underwav. The recent will result in development of mentalization by proactive changes mandate the QACT Key actions under an overall evaluation of risk networking between the cen- to: management issues and iden- ter and the Regions; and cap- * Ensure that safeguard way tification of programs and turing the synergies of in- policies are effectively projects that may present a tegrating safeguards work integrated into traditional broad mandate the QACT will and/or "regional risk." physically co-louatingntry pg af- b lending instruments; ad- build on ongoing activities. physically co-locating the safe- dressed in policy-basedl guard teams and the regional used Certification of "Corporate Risk units, lending; used appropri- Establishmtienit anid Mainteniance Projects." Projects that present ately in new lending in- of a Compliance Moniitoring Sys- a "corporate risk" for safe- struments; and made a tern1. A system is currently be- guard policies will be re- Strengthening the partoftheComprehensive ing developed to identify viewed and certified, as QualiV Assurance Development Framework projects that trigger one or appropriate, by the relevant (CDF). more of the 10 safeguard poli- ESSD Sector Councils and Le- and Compliance o Establish a structure with cies and to assess compliance gal Department. It is anticipat- T clear responsibilities for with these policies and associ- ed that a system for triggering eam implementing safeguard ated disclosure requirements the certification of "corporate As reported in last year's En- policies and monitoring at entry, during supervision, risk projects," on the basis of a vironrment Matter's, the Quality compliance with them. and at completion. Informa- variety of issues, will be devel- Assurance and Compliance * Develop an integrated tion disclosure requirements oped as part of the ongoing Team (QACT) was established system comprised of will be harmonized. (Asimpli- risk management initiative. in ESSD in fiscal 1999 to over- professionals in the fied version of the current re- The QACT will develop a sys- see the Bank's safeguard poli- Anchor, Regions, IFC, and quirements is shown in the Table, tern for management and doc- cies. Including staff from all MIGA for providing page 19.) umentation of all reviews that three families in ESSD and timely, high-quality ad- are undertaken for the certifi- working closely with staff vice oncompliance issues. Collaboration with Quality As- cation of "corporate risk" from the Legal Department, U Establish and administer a suranice Grouip on Portfolio and projects. the unit was intended to sup- practical information Project Review Activities. The port the Regions in achieving management system for QACT, in coordination with Establishi a Safeguards Help Desk. compliance with the safe- compliance with safe- other specialists, will partici- A Help Desk is being estab- guards. In the past year, the I guard policies and pro- I pate in the annual quality as- lished to provide guidance on 20 ENVIRONMENT MATTERS * 2000 application and interpretation Increasingly, the Bank is using conduct training workshops nizing the costs, benefits of safeguard policies and their instruments such as sectoral covering the safeguard policies and trade-offs in a develop- disclosure requirements in dif- environmental assessments and their application. Region- ment context. ferent project contexts. The (SEA) to take a broader look at al training activities are Help Desk will route requests the environmental implica- planned for the Africa Region It has been a year to remem- from task team and other staff tions of development. For ex- and South Asia Region, where ber and to learn for Bank man- to appropriate specialists in ample, the Poland Hard Coal personnel from other regions compliance issues. Looking the Bank, who will provide Sector Restructuring Project will also participate to encour- back, the gap between policies "just in time" quality advice. looked at the past, present, and age transfer of experience be- and implementation on the future effects of the hard-coal tween Regions. ground still leaves room for Preparationi of a CD-ROM on mining sector. Guidance and significant improvement. In Safeguiard Policies. Two CD advice on SEA will be devel- Issues for the longer moving ahead, the challenge is Rom-based electronic guide- oped on the basis of practical term with our effontscountriesn books have already been pre- experience in this area. . pared for use by Bank and Meeting the aims of the safe- Jointly improve results on the borrower staff, one on Envi- Developing Capacity of Bank, guard policies will depend on ronmental Assessment, and Borrower,ard Consullanit Si,ot,i building a consensus about the another on Involuntary Reset- Application of S.t i 1 i Policies. key issues in safeguard policy FOR MORE INFORMATION tlement. An interactive CD- The QACT will expand its implementation and how they ROemcovering all snrafvegrD training program with WBI to should be addressed. In the For morerinformationaboutthe ROM covering incudeltaininetargted t process of accelerating and pulitAsuance Tem,cntac Stephe policies is being prepared. includetrnainional taregio d t implementing the safeguards pliance Team,contact Stephen polid7ies is being prepared. international, regional, and compliance system, a number Gill (458-1296), or Harry van Guiidanice on r. i Policies ntoacnslnswhpr-of strategic issues have been der Wuip (473-8164). in Structuiral anld Sector Adjust- pare environmental and social identified that need to be ad- menit Lendiing. General opera- studies, to fulfill the analytical dressed for the longer term. For information about re- tionalp yfor adjustment requirements of the safeguard These include the following: gional programs, contact: tediona picy set out in Operation policies. In the capacity build- U Strengthening country Jean-RogerMercier(473-5565) lending is set out in Operation- g . or Cyprian Fisiy (473-3580) for al Directive (OD) 8.60, which cinu area, collaboration also ownershlpand capaclity- Africa; Glenn Morgan (458- continues with WBI in training developing realistic and 1909) for East Asia and the Pa- includes some guidance on for Bank and borrower staff pragmatic approaches, cific; Bernie Baratz (473-2333) good practice in adjustment a supported by capacity orStanPeabody(473-2723)for ad iin regional training activ- o tnPaoy(7-73 o loans with environmental con- ities. For example, the Middle building and cross- Europe and Central Asia; Juan sequences. Since March 1999, East and North Africa Region country learning, so that Quintero (473-5294) for Latin sectoral adjustment loans (SE- a country requirements and America and the Caribbean; CALs) have been subject to the published A Guiide for tlhe Prep- procedures are consistent Sherif Arif (473-7315) or CaL's) haverobeentsbjc tosthes aration and Reviezv of Environ- with the safeguards. Mohamed Arbi Ben-Achour Bank's environmental assess- m1lental Assessnmenit Reports as * Application of the safe- (473-2455) for the Middle East ment policy (OP 4.01). A pro- part of the Bank's overall effort guard policies in new and North Africa; and cess s nowunderaV p gadplceinPanneer Selvam (458-2728) or cess iS now underway to to strengthen national environ- contexts-such as policy WarrenWaters(473-6862)for convert thedirectiveon adjust- ment agencies. Additionally, and programmatic lend- South Asia. ment lending into an opera- MNA took the lead in devel- ing; through broader tional policy. The QACT is oping and implementing a sectoral and regional 1. The 10 policies cover environmental leading the review of experi- program that strengthens the assessments; and in a assessment, natural habitats, forestry, ence with adjustment lending, capacity of EA reviewers both more consistent way with pest management, involuntary resettle- ence ~~~~~~~~~~~~~~~~~~~~~~~~~~~ment, indigenous peoples, management including the application of within'the Bank and through- the policies and proce- of cultural property, safety of dams, includingthe appliation ofwithin th Bank andthrough- dures of clients and other projects in international waterways, and OP4.01 to SECALs, learning out the Region. donors. projects in disputed areas. from staff experienced in the U Assessing costs and im- This article ioas prepared by Stephen use of these instruments, and Conduict Regional Training proving cost-effectiveness Lintnter of the ESSD Network, (202) assessing trends in environ- Workshlops on Safeguard Policies. -so that the objectives of 473-2508,fax (202) 477-0565. Safe- guards wecb3ite - 2 tt mental components in adjust- In collaboration with WBI and the safeguard policies can zoarldbank.org/institutionial/lnanu- ment loans. the Regions, QACT will help be achieved while recog- als/opnlanual.nsf ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 21 he debate about climate through the provision of wa- change has tended to ter and sanitation), taking primarily focus on imtiti- measures to reduce the impact s,owon of greenhouse gas emis- of natural disasters through PU.ertk an d ve-'IIs. While this is important appropriate infrastructure P overty an d ! those countries responsible planning, and more generally it. most of the world's green- helping poor people through ' I Lise gas emissions, most de- sound agricultural, land use, lirnate Cange . loping countries can do labor market, environmental, L- I ter in preparing to adapt to and macroeconomic policies to t. day's climate variability and reduce and manage risk. !..og-term climate change. In pi -ctice, this does not require Ciaecag a ', ,ew agenda. Rather, the con- Climate change may c,-! lls raised in the context of exacerbate the tliu climate change debate sim- rI ;I reinforce the urgency to problems already .-J iress the fundamental prob- faced by poor l. !11s facing poor people.' This ina.ns strengthening the com- people In tment to improve the health t, poor people (especially The majority of scientific ex- perts believe that human- induced climate change is Observed change in annual precipitation for the 2050s . The change in annual precipitation for the 2050s compared with the present day, when the climate inevitable. The question is not model is driven with an increase in greenhouse gas concentrations equivalent to about I percent whether climate will change in increase per year in CO2. This illustration shows the average of four model runs with different starting response to human activities, conditions. but rather zvwlere, zvhen, and by 90° N .l----r---- - how nmtich. For example, evap- oration will be enhanced as the climate warms, and there will 450 N L be an increase in global mean precipitation, accompanied by 5X m seasonal shifts, and an increase 00 = . 4 959-> -in the frequency and magni- tude of heavy precipitation - $--~ events. However, not all land * , - , regions will experience an in- 45 S r - - Q- - -w M - -C crease in precipitation, and ! --__even those land regions with increased precipitation may 90° 0 90S, -------------------- -- ----------- --- ------ -- --_ _ _ __ _ _ _ _: experience decreases in soil 180° 90° W 0° 90° E 180 moisture because of enhanced _____________________________________________________________________________________ evaporation. Precipitation and runoff is projected to increase -3 -2 -1 0 1 2 3 in tropical areas and at high Precipitation change (mm day-') latitudes, but decrease in sum- Source: R. Nicholls, Middlesex University in the U.K. Meteorological Office. 1997. Climate Change and Its Impacts: A Global mer over much of the sub- Perspective. Brittanic Crown Copyright. tropics and mid-continental 22 ENVIRONMENT MATTERS * 2000 areas; for example, in the Sa- causedbyupstreamdeforestation production. But, with larger next 50 years (see Figure, hel, Southern Africa, the Mid- -and they typically do not changes in temperature, pro- below). dle East, and parts of Latin have access to crop or health- duction is likely to decrease. America (see Figuire, page 22). care insurance. Between 1990 However, crop yields and While there are competing and and 1998, 94 percent of the changes in productivity due to widely divergent views on the There is therefore increasing world's 568 major natural climate change will vary con- extent to which adaptation can interest in mechanisms to bet- disasters and more than 97 siderably across regions and succeed in preventing poten- ter adapt to climate change- percent of all natural disaster- among localities, thus chang- tiallv adverse effects on the especially in developing coun- related deaths were in devel- ing the patterns of production. global balance between food tries. At the same time, mea- oping countries. supply and demand, most sures to at least stabilize cli- In general, productivity is pro- studies suggest that develop- mate change (to the exten t it is The following provides some jected to increase in middle to i caused by human activities) examples of what the future high latitudes, depending on sub- tropics l ef . , , ~~~~~~~~~~~~~~sub-tropics could face difficul- are drawing growing attention might hold: crop type, growing season, ties in adapting. Therefore in those countries best able to changes in temperature re- there may be increased risk of make a difference. According Food Secutrity. Currently, 800 gime, and seasonality of pre- her in be lcas in of to the Worldwatch Institute, million people are malnour- cipitation. In the tropics and hungeroinsome locations inthe emissions of CO, fell by 0.5 ished. As the world's popula- subtropics, where some crops m and world's poore percent in 1998, while the glo- tion increases and incomes in are near their maximum tem- many of the world's poorest bal economy grew by 2.5 per- some countries rise, food con- perature tolerance and where people live. These projections cent. Coal sector reform in sumption is expected to dou- dryland, non-irrigated agricul- have considered the positive China and Poland may have ble over the next three to four ture dominates, yields are like- effects of higher atmospheric contributed significantly in decades. For changes in global ly to decrease with even small levels of carbon dioxide, but this regard, demonstrating mean surface temperatures of changes in temperature, espe- have not fully considered the the synergy between sound less than 2.5 degrees Centi- cially in Africa, Latin America, effects of potential changes in economic and environmental grade, studies show that, on and Asia. In these regions, de- climate variability, water avail- policies.2 the whole, global agricultural creases in overall agricultural ability, stresses from pests, dis- production might be main- productivity of up to 30 per- eases, and interactions with In most cases, climate change tained relative to baseline cent are projected during the other existing stresses. is likely to exacerbate prob- lems that developing countries Projected crop yield changes - 2050 are alreadv facing. Extreme 2050s changes in weather affect a larger share of their economies because these are in climate- l sensitive sectors (agriculture, coastal fisheries, forestry), and those living on subsistence ag- riculture cannot afford to en- gage in higher-risk activities that could lift them out of pov- erty. Poor people are most vul- nerable, since they are often forced to live in flimsy dwell- ings in areas most prone to Yield Change disasters-low-lying flood Cag I plains, coastal areas, or hill- 403 -20 -lO O lO 20 sides subject to mudslides Source: M. Parry, et al. in the U.K. Meteorological Office. 1997. Climate Change and Its Impacts: A Global Perspective. from flooding, sometimes Brittanic Crown Copyright. ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 23 Water Resources. Currently 1.3 Bangladesh alone, three lions of people (see Figure, andhumanhealtharenotnew billion people do not have ac- storms, four floods, one tsuna- page 25). issues in developing countries, cess to adequate supplies of mi, and two cyclones killed and climate change only rein- safe water, and 2 billion peo- more than 400,000 people and Human Healthi. Human health forces the urgency with which ple do not have access to ade- affected another 42 million is sensitive to changes in cli- Ithey need to be addressed. In quate sanitation. About 20 peoplebetweenl990andl998. mate because of changes in I other words, the climate countries, primarily in the food security, water supply change debate does not call for Middle East and Africa, are Disasters can cause irreparable and quality, and the distribu- g classified as water-scarce or life loss, undermine social cap- tion of ecological systems. In- water-stressed. Changes in ital development, and destroy direct effects could include Most of these problems are al- water stress and water scarci- livelihoods on a large scale. For increases in infectious diseas- ready acute today, and their ty will depend, in part, on cli- example, development of the es such as salmonellosis, chol- solution calls for sound eco- mate change, but will be entire coastal region in Orissa era, and other food- and nomic and social policies, in- predominantly shaped by fu- has been setback several years water-related infections, (be- cluding: ture growth in water demand; after just three days of a major cause of climatic impacts on * Helping poor people manage evolution of management of cyclone. Impacts may vary water distribution and temper- risk better, such as froni water supplies, demands, and across regions, and social costs ature); and micro-organism harvestfailure andfood price quality; and the extent to will greatly depend upon the proliferation. There could also increases. This requires which sustainable water man- vulnerability of the coastal sys- be an extension in the range agricultural policies that agement practices are adopted. tem and the economic situa- and season for vector organ- take into account weather- Even in the absence of climate tion of the country. Sea-level isms, thus increasing the related requirements. For change, the number of water- rise will increase the vulnera- transmission of vector-borne example, subsidies for stressed countries is expected bility of coastal populations to infectious diseases (such as, maize may not be sensible to double by 2025, in large part flooding. Small islands and malaria, dengue, yellow fever, in an environment where because of inefficient uses in deltaic areas are particularly and encephalitis), cimatenisohighl vare agriculture. Water stress and vulnerable to a one-meter sea- p climate is highly variable, the frequency and magnitude level rise, with land losses T locking farmers into an of droughts areprojectedtobe Tranging from 1 percent e e agen a for inappropriate crop. Simi- exacerbated by climate change Egypt, to 17.5 percent in Bang- develoning countries larly, agricultural storage in many semi-arid countries in ladesh, to about 80 percent in ro capacity needs to accom- northern Africa, southern Af- the Marshall Islands, poten- Food security, water resources, modate seasonal fluctua- rica, and the Middle East (see tially displacing tens of mil- vulnerability in coastal areas, tions in crop production. Figure, this page). Vulnerability in Coastal Areas. Change in water stress Abouthalfofthe inwCorl'stl Area. Change in water stress, due to climate change, in countries using more than 20 percent About half of the world's peo- of their potential water resources. ple live in coastal zones, al- W _ - though there is a large ,- ..............."<'- " ~'' variation among countries. - -; Changes in climate will affect coastal systems through sea- level rise (projected to increase by 15-90 cms by 2100) and an r-* .c .: Ž-: increase in storm-surge haz- - ards, and possible changes in , . -. w the frequency and/or intensi- , > kj ty of extreme events. It has 2050s - been estimated that people in low-income countries are four U -. times more likely to die in nat- stressed country wath increase in stress country moves to stressed class stressed country with decrease in stress ural disasters than people in Source: N. Arnell and R. King, University of Southampton in the U.K. Meteorological Office. 1997. Climate Change and Its Impacts: A Global Perspective. Brittanic Crown Copyright. high-income countries.3 In 24 ~~~~~~~~~~~~~~~~~~~~~~~ENVIRONMENT MATTERS * 2000 People at risk from a 44 cm sea-level rise by the 2080s, assuming 1990s level of flood protection Areas most vulnerable m a d leel c to wetland loss M f, : PEOPLE AT RISKf ' s (millions per region) c r a p > 50 million 10-50 million , _ , _ ........ .regiOn boundary Source: R. Nicholls, Middlesex University in the U.K. Meteorological Office. 1997. Climate Change and Its Impacts: A Global Perspec- tive. Brittanic Crown Copyright. In areas prone to droughts when mangroves and ment at different levels cliild ,,.,,1,,1h. and rediicc and floods, community coral reefs are protected. can help diversify eco- | tte risk of itifcciots discases. food banks might be con- * Red ucing thze l ivelihiood nomic activities to ensure These investments repre- sidered. Water-use effici- impact of natural disasters that communities are not sented the single most ency needs tobe improved (including unemploynment). vulnerable in case of na- significant factor leading worldwide, and especially For example, urban neigh- tural or economic shocks. to the major increases in in arid countries. borhood work programs * Providing the most exten- life expectancy observed * Reducing and prevenitinzg can be designed to im- sive coverage possible of inindustrialized countries risks and vulnerabilityfronl prove building practices watersupplyand sainitation- at the end of the last natural disasters. While and make urban settle- combinedwzoithlgood ,,. century. disaster preparedness and ments less disaster-prone education-in order to im- rapid response is impor- met. esdsse-rn diain i re oin rapidbetter responseis cp in the future. And govern- prove public hIealth, reduce tant, better results can be achieved by averting, _ _ _ ___ avoiding, and/or adapt- 1. These issues are addressed in detail ing to hazards. ATi impor- in the World Bank's forthcoming Worll ing to hazards. An impor- l 7 - l ,1 . Devoelopment Report 2000/01 on Poverty. tant element in this ap- . 31 - . 2. In 1998, China's economy grew by 7.2 proach is to protect and . . percent, whiile its CO, emi'ssions fell by rehabilitate environmen- l C . 3.7 percent. The removal of coal subsi- dies is considered an important factor in tal systems and resources. .: . this case. similarly in Poland, the econo- my grew by 6 percent, while emissions For example, reforestation .. . declined by 9.7 percent. can help avoid landslides t * F v j, - . } qk l S 3. International Federation of Red Cross and downstream flash and Red Crescent Societies. World Disas- floods. Conservation of tcrr RrTort 1999, p. 34 wetlands and clearing of .s I i s s This article was prepared by Robert drainage systems can E . T. Watson of the Office of the Vice prevent floods in urban .President (ESSD), (202) 473-6965, areas. And well-planned . fax (202) 522-7122, and Richard 0. coastal development re- ~~~~~~~~~~~~~~~Ackermiann of the Souith Asia and coastal development re- - Pacific Environment Sector Unit, duces the risks of flooding Preparing seedlings for planting. (202) 473-2606,fax (202) 522-1664. ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 25 I ' i ['. 1 .Iicik > 1\Li1.. I II f life, we will neither signifi- PC' LIoPnhF *l.t ! I'LiL -, :antly reduce rural poverty I Ln~ ..iin I tE % . oir I iior improve food security. It .frI1 *-i *1,,, .' ' H -lowever, this must be |> ev isitin g i, 'i. , 1,t' "I tl), 'L,- ichieved without significantly !.-1 ItI.'h*- hiarming the environment. An ,mportant cornerstone will be t h e R u ra l ontinued promotion of more [Fc eI; tIl, I' '"'- I cnvironmentally friendly and -Pt'' Ci t'. I J, ti.n vi.I Ii. . ustainable approaches to ru- D evelopm en t -I,CJ :ijlkl tiel Ih -.LI,-. blwId 0'1 at development. t ! ' 1 . -i J _!, I0 'd . ,1 I*,t J -tf-.:L1i k- tt '11,, nI *.%1 1' Looking back Strategy V- -LiIICn i, .f II !.- rf MJ . c11.i,, v tit Rural development: From Vi- _._ \ t ci:, I .. k '111t !t ion to Actioin mapped out sev- group revisits the strategy, it eral recommendations: willpay particular attention to * Take a broad rutral focus the lessons learned from im- rather than a narrow agri- plementation in the past three cultural sector focus. For years; to emerging priorities, example, instead of deal- which reflect changing global ing with agriculture, conditions; and to an action- livestock, or forestry oriented approach. separately, focus on the management of natural There are several compelling resources in sustainable reasons for a strong Bank fo- production systems. * Involve alll World Banlk staff cus on rural development. in tie promotion of rural While the world is witnessing developnient. rapid urbanization in the de- * Work zwitli partner countries veloping world, rural areas are and the brooder international still home to the majority of the comnity to integrate rural population. More importantly, developmizent in overall rural areas will be home to the country development strnte- majority of the world's poor gies. The strategy stressed residents for the foreseeable the formulation of Coun- future. Rural poverty is perva- try Assistance Strategies sive and persistent. Absent a as an integrating tool. A _ * .f - major, committed and sus- * Address old issuies in new tained effort to reduce rural ways. Examples of new poverty, the Bank's overall ob- approaches include invol- .r , v _ jective of poverty reduction ving stakeholders in the simply cannot be met. Without development and execu- broad-based agricultural and tion of projects; involving ¶ -- x economic development, which the privaLe sector in de- empowers several hundreds of livering infrastructure and millions of low-income people other services; and using with sufficient purchasing c o m m u n i t y - b a s e d _~ =. . ~ - * power to improve the quality management to promote Family farming, Latvia. of their diet and their quality sustainable resource use. 26 ENV[RONMENT MATTERS * 2000 * Reverse environmental degra- niques. There are many early of 700 percent. The beneficia- People and Coinl mnities. The dation. indicators of project success, ry fishermen have been able to new strategy will reflect a com- including reduced rates of out- repay loans, buy land, reno- mitment to assisting poor ru- Sustainability and migration (and some return in- vate houses, and enroll their ral people and communities in migration to the project areas), children in school. The Fisher- identification, prioritization, rural development a substantial increase in fodder ies IV Project aims to address determination, and implemen- trees, a reduction in the num- the manv environmental prob- tation of solutions to their de- One of the important objec- ber of grazing animals and an lems stemming from un- velopment priorities. tives of the Bank's rural devel- increase in stall feeding, and planned shrimp and fish opment strategy is to identify increased adaptation of dry- production, including water Private-Sector Growth. In many and promote new approaches land and irrigation forages. quality problems and the loss developing nations, the ne- to sustainable natural resource of wetlands and mangroves. glect of infrastructure and pub- management. Environmental Land. The Sodic Lands Recla- lic services in rural areas is an degradation is one of the most mation Project in Uttar R th ttt impediment to private-sector significant drivers of rural Pradesh, India, has had a sig- evising he stra gy development. The new strate- poverty, and leads to a down- nificant impact on poverty and The definition of rural devel- gy will carefully assess how ward spiral of declining agri- institutional development. The opment and the major strate- the Bank could catalyze cultural productivity, increas- primary beneficiaries targeted gic objectives outlined in From private-sector development in ing poverty, and further are poor, marginal farmers and Vision to Action are clearly still rural areas. degradation. the landless poor. The project valid and appropriate. Since includes extensive community the mid-1990s, however, there Timing and Several recent Bank projects participation, use of remote have been significant changes illustrate the potential for sensing and GIS, extensive e ives 0 ~~~~~in the countries where theojtis sustainable natural resource monitoring systems, and ap- Bank is imptementing rural management. plied research. Virtually all the Bak p pro g as Recognizing that rural devel- work was done by some development programs, as opment is country and region- !'%ot, l,, .l- In eastern Turkey, 175,000 farm families, includ- well as in the global arena. In ally specific, the new strategy in an area of erosion-prone, ing 55,000 families who were several areas, there is a need will include the development fragile soils, there was unprec- previously landless. These to revisit the strategy of detailed regional strategies edented cooperation between farmers were given clear title and action plans. The regional government agencies and local to the land they reclaimed. Nonagricultural Issutes. Agricul- strategies will focus on past communities in the Eastern Within six months of reclama- ture is a critical catalyst to sus- project and policy experiences, Anatolia Watershed Manage- tion activities, yields of rice tainable rural development, identifying what has worked ment Project. Some 79 micro- and wheat doubled original but agriculture alone is insuf- well and the major lessons catchment rehabilitation plans project estimates, wage rates ficient. The revised strategy learned in implementing the are underwav covering doubled,andlandvaluesqua will highlight the need to World Bank's rural develop- 600,000 hectares and 300 vil- drupled. There is no doubt bring rural infrastructure, ru- ment activities. The final prod- lages with over 200,000 people. poverty has declined, and mi- ral education and health, and uct will include both the Later this year, this approach gration to urban areas has fall- rural nonagricultural business overall strategy and action will be initiated in 13 addi- en in the project area. The activities into the mainstream plan as well as the regional tional provinces. The project project is being scaled up to of rural development activi- strategies. It is hoped that the typifies a more holistic, include 69,000 hectares. ties. new strategy will be complet- ed by mid-2001. partnership-based approach. Utilizing partnerships be- Fishleries. As part of the Bang- Infrastructure. In the rural in- tween communities and local ladesh Fisheries III Project, a frastructure area, infrastruc- | and national government, the community-based floodplain ture upgrading and main- This article was prepared by Lynn R. , s : ~~~~~~~~~~~~~~~Brown of the Rural Devoelopm?ent project tackled both sides of was stocked with fingerlings. tenance increasingly should be Department, (202) 458-8175, fax the resource degradation In addition to maintaining the supported and implemented (202) 522-3307. It is based, in part, issue-income-generation ac- diversity of the existing fish by private contractors and lo- on a concept note on the new roiral development strategy prepared by tivities and improved natural stocks, the additional species cal communities in partner- Csaba Csaki. Website - http:// resource management tech- showed average weight gains ship with local government. I zww.worldbank.org/rural ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 27 e environmental ser- systems in which land users vices provided by nat- are compensated for the envi- n ural ecosystems are of- ronmental services they gener- P aym en ts for ten takenforgranteduntilthey ate. Several countries are are lost. For example, the hy- already experimenting with drological services provided such systems (see Box), espe- En Viron m en t by forests are only noticed af- cially in Central and South ter deforestation results in America, where the effects of rvices flooding or dry-season waterHurricane Mitch have made S rv ices scarcity. That such services tricne Mitch havermad ________________________________________________~~~~~~~~~~~~~ the need to protect environ- should be lost-despite their value-is easy to understand: mna evcscer h Landlusers typically tounere eno World Bank is assisting sever- Land users typically receive no a onre ndvlpn compensation for the services acotris in eloin their land generates for others, and so do not take them into ronmental services, with the account in making land-use Latin America and Caribbean decisions. region taking the operational lead and the Environment De- Recognition of this problem partment providing technical has led to efforts to develop support. ENVIRONMENTAL SERVICE PAYMENTS- NATIONAL INITIATIVES AND WORLD BANK SUPPORT * Costa Rica has the most advanced system of payments for environmental services. Land users who protect natural for- ests or reforest their land receive payments of about $50 per hectare per year. These payments are financed from energy taxes, the sale of carbon offsets, and international donations for biodiversity conservation. This program is now support- ed by the World Bank and the GEF through the Ecomar- kets project. * In Ecuador, the municipal water authorities in Quito and Cuenca are allocating part of their revenues to financing pro- tection activities in the watersheds from which they receive the bulk of their water. The World Bank is assisting the gov- ernment in preparing a project on payments for environmental services from private lands, which would serve as a pilot for expanded efforts both in the country and in other Amazon basin countries. * In Colombia, many water-user groups pay for watershed services-sometimes by buying the entire upper watershed. Power companies must by law pay a percentage of their revenues from hydroelectric power to the regional corpora- tions that are responsible for watershed management. * In El Salvador, the World Bank is assisting the government to develop the Natural Environmental Management Project, which will use payment mechanisms to obtain environmen- tal services-in this instance, watershed protection (primari- ly for flood control/disaster prevention) and the creation of biodiversity corridors to link the country's protected areas. Southem Thailand. 28 ENVIRONMENT MATTERS * 2000 Identifying environmental services The benefits sought from land- use changes typically include (but are not limited to): * I T, d, , . i, n ?kbeniefits. Con- trolling the timing and volume of water flows, and the quality of water; * Red2cing sedimientation. Avoiding damage to downstream reservoirs and waterways and hence their uses (hydroelectric power generation, irriga- tion, recreation, fisheries, Laguna del Tigre National Park. Guatemala. domestic water supplies); * Disaster prevenition. Pre- Effective systecmls. Environmen- for reforestation can en- political economy and equity venting*flooding and tal service payments will only courage land users to cuat issues. venting flooding and have the desired effect if they down standing trees so as landslides; and reach land users in ways that to qualify. Work on payments for envi- * Biodiversity conservation. motivate them to change their ronmental services is under- Ensuring that land uses land-use decisions. In general, Financing and taken by the World Bank are more friendly to bio- several principles are clear: Financing Environment Department's diversity. * Make payments oni-goiiig. institutional issues Policy, Economics, and Pollu- The benefits being sought tion Team, in collaboration Both qualitatively and (espe- will generally be enjoyed Systems of environmental ser- with LCR, RDV, DEC, and oth- cially) quantitatively, we often year after year, as long as vice payments must have se- er Bank units. A website has know less about the services appropriate land uses are cure sources of financing,- been established to share infor- generated by different land maintained. For this to Ideally, beneficiaries of the ser- mation and best practices in uetnwd . Toccur, land users must vices are charged-for exam- this field (http://www-esd. use thn w thnk ve o. his receive payments as long pie, fees can be assessed on worldbank.org/eei), under reflects partly the diversity of as thev maintain the land water users to pay for conser- "New Initiatives." conditions encountered (for use. vation of water sources. Once example, hydrological benefits U Target paymients. An undif- established, these systems can depend on the rainfall regime, ferentiated payment sys- be self-financing, and not re- on the type of soil and vegeta- tem that pas everyone quire continued support from For more information, email tion, and on topography) and more expensive th Stefano Pagiola - ton, the objetivesrbeing sough more expensive than a government budgets. (spagiola~worldbank.org), on the objectives being sought targeted scheme. It will or Gunars Platais- (for example, regulating water- also make it difficult to Designing and implementing (gplatais@worldbank.org). flows to avoid flooding and tailor interventions to the systems of payments for envi- dry-season deficits may re- particular requirements of ronmental services may re- Thlis article was prepared by Stefano quire different interventions given situations. quire changes in the legislative Pagioln of tie Enviromnment Depart- me,zt's Policy, Economics, and Pal- than maximizing total water 1 Avoid perverse in2centives, and regulatory framework. ltioni Unit, (202) 458-2997, fax volume). For example, payments They often also raise thorny (202) 522-1735. ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 29 Angola -T ~~~~~~Benin Boimwaba ing our cliet cuntresorverseniromentldgraBuruidi sults is all lined wit enviCamercon n.ltll.l resllr W In . -th!!l* %1 te regin's poulatio live he envronmenal chalengesfacingtheiAficaRReionlar Comoros Cong, rDemocratic Republic of Congo, Republic of products. ~ ~ ~ ~ ~ ~ ~ ~ .* eniomnCnidsesb enpart Al cank wrkpubinl .~~~. ~~C6te d'lvoire sectors; that is, mainstreaming envEquatorial Guinea Eritrea -- ~~~~~~~Ethiopia Gabon -Gambia, The Ghana from surrounding areas. In both rural and urban areas, poor Thesmallresourcesavailableforstand-alonGuinea - ~~~~~~Guinea-Bissau Kenya .5 ~~~~~~~~~~~~~~~~Lesotho 1700- ~~~~~~Liberia - ~~~~~Madagascar Malawi Mauritania Mozambique Namibia Ot ~~~~~Niger iim ~~~~~Nigeria nNiiiiiiiiiiiRwanda Pr___ ~~~~Sao Tome and Principe Senegal Seychelles Sierra Leone AL ~~~~~Somalia South Africa Sudan W ~~~~ ~~~ a ~~~Swaziland Tanzania Togo P4. Uganda* ar. ~ Zambia Zimbabwe ppn Sub Sahafract Africa the World Bank's In the Africa Region, our efforts continue to focus on assist- missthdeteionation ofght poveron tyl withilastinging our client countries to reverse environmental degrada- a tmissiosvnerab to fightuerty witasters,iofteng inteni- tion in their pursuit of sustainable economic development. suits is inescapablv linked with environ- ielYltlW PIOtectlin .ld1 iLrpr[.' .-d management of renewable Calne ha naturalnresusinabl l. -ran,d-uslthe region'spopulationlive The environmental challenges facing the Africa Region are in rural areas and are dependent on rainfed agriculture and complex and diverse yet they are a critical part of an overall other natural resources for their livelihoods. Ecological pro- poverty alleviation strategy. Key challenges include the fol- cesses largely ensure adequate supplies of clean water, main- lowing: tain soil fertility, and provide woodfuels and other essential Mainstrcatning. Concerted efforts are required to make products. environment an indispensable part of Bank work in all sectors; that is, mainstreaming environment within the Major African cities also depend heavily on natural resources public and private sectors of the countries themselves. from surrounding areas. In both rural and urban areas, poor The small resources available for stand-alone people are the most affected by the loss of natural resources environment programs are insufficient to get results. aind the depterioration of environmental services. They are Pr-ivate-sector Growth. To ensure sustainable growth, the also the most vulnerable to natural disasters, often intensi- private sector needs to incorporate principles of fied by unsustainable land-use practices. environmental sustainability through approaches such 30 ENVIRONMIENT MATTERS * 2000 as the green certification of management projects that are support- products, eco-labeling, and meeting ing the implementation of National En- GEF IN SOUTH AFRICA the requirements of ISO 14000. Priva- vironmental Management Plans. In line During fiscal 2000, the GEF approved tization of industry presents an with mainstreaming environment and four Medium-Sized-Project grants for opportunity to remedy a legacy of decentralizing environmental manage- South Africa. The grants support adap- toxic, hazardous, and health- ment, new initiatives emphasize incor- tive research on conservation farming damaging liabilities. porating environmienital componen-its in Lto practices, conservation planning for the Eastern Cape thicket biome ecosystem, * Biodiversity Coniservationi. Survival of sectoral operations, such as the Chad- community-oriented development of a the region's globally significant Cameroon Pipeline project (see below). new national park in the Namaqualand biological resources will depend not region, and introducing solar thermal only upon global support through In fiscal 2000, the Region also prepared electric (STE) technologies as electric- the GEF, but also upon long-term an agenda for implementing the Strate- rica.. These complement the Cape conservation financing programs gic Framework for Integrated Coastal Peninsula Trust project already under and externally funded trusts or Zone Management in priority coastal implementation and the Maloti- endowments. areas including rapidly expanding cit- Drakensberg project, which is in the fi- areas, including rapidly nal stages of approval. While several * Urbanization. Without intensified ies such as Lagos, Dar Es Salaam, more individual projects are in the pipe- environmental planning and man- Maputo, and Cape Town. The report is line, the Government of South Africa and agement, unplanned growth in cities being updated in fiscal 2001. the Bank have agreed that South Africa will exacerbate the depletion of is a good candidate for a programmatic approach to GEF support, in which GEF forests and the degradation of The Region has also developed the Glo- funds would be used systematically to freshwater and marine resources. bao Environmenit Strategic Framework, add a global environmental dimension to * Transparency. Transparency in re- which is designed to mainstream global a wide range of environmental manage- source management decisions is environment concerns and leverage glo- ment initiatives by government, NGOs and the private sector, and to stimulate necessary to evaluate competing bal funding. The framework calls for investment in the conservation and sus- agendas, especially the tradeoffs more GEF and other funding to be stra- tainable use of globally significant between short-term benefits and tegically used and integrated into Coun- biodiversity. A proposal for a GEF pro- irreversible long-term losses. try Assistance Strategies (CASs) and grammatic grant for South Africa is un- der development and should be * Envairownmental Assessmnents (EAs). Bank operations. The strategic frame- submitted for GEF consideration some- More proactive use of EAs can help work demonstrates linkages to natural time in fiscal 2001. shape investment decisions, identify resource management, rural develop- opportunities, create awareness ment (for example, within the Soil Fer- through disclosure, and help tility Initiative, through GEF's Opera- systems as well as arid and semi-arid build environmental management tional Program on Integrated Ecosystem ecosystems, such as the Burkina Faso capacity. Management), and climate change mi- Sahelian Integrated Ecosystem Manage- * Ecosystemii-wide Planning. In Africa, tiatives that provide both local and glo- ment Program, the Niger Community- ecosystems do not respect admin- bal benefits. Based Integrated Ecosystem Manage- istrative borders. For example, most ment Program, and the Benin Program for the Management of Forests and Ad- major rivers flow through several GEF Portfolio. Since fiscal 1999, the GEF jacent Lands. The first proposal on nations. Effective environmental project pipeline in Sub-Saharan Africa sustainable transport and air pollu- management requires subregional has doubled. From fiscal 1999 to fiscal tion reduction in Benin also is under accountability, cooperation, coor- 2000, the GEF allocation for the Africa development dination, and accords. Region increased by 31 percent. The portfolio is increasingly diversified, with In the Region's Medium-Sized-Projects Mainstreaming more activities in climate change and (MSP) portfolio, 12 projects are approved environment In the international waters. New projects being and under implementation, and an ad- prepared include Lake Chad, the Nile ditional 12 are in the pipeline. This fund- portfolio Basin Initiative (see below), Senegal ing window enables the Region to River Basin, and Niger River Basin. In diversify project partners beyond gov- The Africa environment portfolio in- biodiversity and ecosystem manage- ernments to encompass community or- cludes several ongoing environmental ment, more projects focus on coastal eco- ganizations and NGOs. ANNUAL REVIEW * JULY 1949-JUNE 2000 (FY2000) 31 Safeguard policies and Projects Active during F2OOO with Property, Resettlement, and Forests. *9 S |Significant Environmental Objectives Only a small amount of tropical forest enlvironlmentlal GEF/MP Rat iral es. (10-15 square kilometers) will be lost as assessme n t 18% ck Rural Env. Mgt. a result of the construction. To compen- assessment * 10%sate for this, two large new national parks During fiscal 2000, the Region continued , totaling about 5,000 square kilometers to , focus on a country capacits7 building -have been created in Cameroon, and will to focus on a country capacitv building strategy for environmental assessment. ?juc.~ & be managed for better biodiversity con- strategy forenvironmenta assessment. P61lul.cr. &servation in those areas. Part of the strategy is the Capacity and Urb En, Mei. Linkages in EIA for Africa (CLEIAA) `l * Linkages in EJA or Afria (CLEIAThe private developers will bear the program, which by 2010 aspires to have m r t oa-. In'titutional majorburden of the Environmental Man- a working EIA system in place in all Af- agement Plan, which has been exten- rican countries. Its short-term objectives sively reviewed by the Bank and IFC are to (a) improve information sharing in African countries; the donor commu- joint-venture pipeline companies. De- teams. The loan packages incorporate in A; and rlntr ntional s onal, pending on world oil prices, the project inde dent monitoring activities nitv, and relevant national, subregional ,.. I . could yield up to $2 billion in revenues whose objective is to maximize transpar- regional, and international organiza- for Chad and $500 million for Cameroon ency and compliance with loan agree- tions; (b) harmoniorzCadeandIA0capaliityordCmvrl- tions; (b) harmonize F.IA capacty devel- over the 25-year production period. ments. Positive side effects of the projects opment efforts on the African continent; have already surfaced. For example, the and (c) design long-term sustainability In addition to the IBRD and IFC invest Government of Chad has launched into the initiative and related organiza- ments the Board approved two other preparation of the country's first National tional structure. IDA credits totaling about $30 million to Environmental Action Plan (NEAP). The help strengthen Chad's and Cameroon to challenge now is to ensure that these The Region initiated a convergence of capacity for environmental management various commitments are carried environmental and social teams to facili- and monitoring of the petroleum sectors. through to satisfactory results. tate compliance with the Bank's 10 safe- An international advisory group consist- guard policies, under the guidance of ing of independent international experts Regional programs the Africa Region Safeguard Policies will monitor the projects, with particu- Enhancement team (ASPEN). lar attention to social and environmen- Regional programs managed by the Envi- tal safeguards. ronment Group in the Africa Region are The Chad-Cameroon grouped under the common label of Ca- Following 18 months of analysis and pacity Building for Environmental Man- project publication of a 19-volume Environmen- agement (CBEM). These programs incude: tal Impact Assessment and Management * Networking for ESD provides World Bank safeguard policies plaved a support for African-based networks Plan, significant changes were made to major role in the development of the ' such as the Network for Environ- Chad-Cameroon Petroleum Develop- the proposed right-of-way. As a result mentally Sustainable Development ment and Pipeline Project, which was the project will have only a minor net (NESDA), the Environmental Infor- approved by the Board on June 6, 2000. effect on the natural and human environ- mation Systems program, and ments. The pipeline will be buried rather Managing the Environment Locally The project, expected to cost S3.7 billion, than above-ground. For most of the in SSA (MELISSA); will develop the oil fields at Doba in route, it follows existing infrastructure. Environmental Assessment has southern Chad and construct a 1,070-ki- No one will need to be resettled along supported development of an lometer pipeline to offshore oil-loading the route, although a maximum of 150 African Stakeholder Action Plan for facilities on Cameroon's Atlantic coast. families may be displaced where the oil EA and subregional groupings to Almost all of the $3.7 billion investment itself will be produced. strengthen the role of EA in is private. The World Bank is providing environmental management; $93 million in IBRD funds to finance the The final route complies with World * Integrated Coastal Zone Manage- governments' equity share in the project Bank safeguard policies, including those ment (ICZM) has developed an and a $100 million loan from the Inter- on Environmental Assessments, Natural ICZM strategy (see box), delivered national Finance Corporation (IFC) to the Habitats, Indigenous Peoples, Cultural training to local NGOs/CBOs, 32 ENVIRONMENT MATTERS * 2000 -Lle ':0 established a Coastal Database, Center, and designed a regional Forest management and designed a leadership training strategy for climate change. program, and developed EA guide- biodiversity conservatLion lines for coastal tourism and With shrinking resources for regional Deforestation and biodiversity loss are aquaculture; activities, regional programs will be se- tworent envionmenty isss afe * Environmental Economics has verely curtailed in fiscal 2001. two urgent environmental issues in Af- studied the experience with eco- rica. These losses impact the rural poor nomic instruments for environ- Ecosystem and and national economies, as well as di- mental management and their a minish a unique world heritage. Over the applicability under African con- landscape management past 15 years, the Bank has largely dis- ditions, the links between economic engaged from the forestry sector in Af- reforms and environmental impacts, It is widely acknowtedged that effective rica due to the poor performance and and mainstreaming environmental environmental management cannot be low impact of its operations. Its engage- considerations in country strategy limited to isolated and localized inter- ment in biodiversity conservation has work. An example of the latter is an ventions. Yet ecosystem management is been growing-primarily through the "Environment Update" for Ethiopia, a difficult challenge because of the lack Global Environment Facility-but the which systematically reviews how of institutional mechanisms for coordi- impact of this support has generally which~~~ ~ sytmtcly.eiw o nating land and resource use over large ipc fti upr a eeal environmental priorities have (or nating land van resource use rlver been below expectations. have ot) ben adresse; and areas. Where vital resources such as river h Climate Variability anddre d Canged basins and wildlife habitats span national * Climnate Variability and Change has boundaries, the challenge is even greater. To improve its effectiveness in helping supported studies on the impact of clients address these inter-related issues, climate change on African agri- The Nile Basin Initiative (NBI) is one the Africa Region prepared a Joint Op- culture, managed an IDF grant for example of regional cooperation to man- erational Strategy (JOS) for improving the SADC Drought Monitoring age a major trans-border resource. The forest management and biodiversity con- Nile Basin covers 10 countries and is servation in Africa. This strategy has co- characterized by extreme poverty, insta- incided with and benefited from a MOZAMBIQUE -COASTAL AND bility, rapid population growth, and en- broad-based review of implementation MARINE BIODIVERSITY Tvironmental degradation. Urgent of the Bank's 1991 Forest Policy, as well MANAGEMENT PROJECT environmental issues include aquatic as recentlv developed Strategic Frame- Mozambique's coastal zone is unique in weed infestations, soil erosion, and sedi- works for improved forest management the East Africa region in terms of quality, mentation caused by forest clearing, and for biodiversity conservation in Africa. diversity, and species richness of its habi- overgrazing, and poor agricultural prac- tats. It also provides a livelihood for thou- tices on steep, erosion-prone land. The sands of people and is attracting riparian governments, facilitated by the Key elements of the JOS include adopt- significant foreign investment for tourism World Bank, UNDP, and CIDA, have s- ing a phased approach to Bank interven- and other development. The joint IDA and tablished the NBI in order to realize their tion, using instruments such as GEF project approved in 2000 will sup- shared vision of achieving sustainable market-based incentives, long-term pro- port the development of a district-level model that integrates environmental and and equitable development based on the grammatic lending and ecosystem man- social sustainability into appropriate pri- common resources of the Nile River. agement; and assisting African countries vate and public sector investment. The and rural people to capture a greater projectwill supportthe formulation of two The countries of southern Africa have share of the growing market for global strategic spatial development plans cov- also begun to tackle the challenge of re- environmental services. The action plan ering both terrestrial and marine territory gional integration through trans-fripeetn heJSietfe ih in two priority areas (Nampula and Cabo boundary initiatives that combine high forimptementingtheJO idenr fies h Delgado in the northern province), level pltclspotadtcnclc-pirt onre hr oetai Project components include community political support and techncal co- biodiversity loss is having the greatest pilot projects; an initiative to attract pri- operation on the ground to achieve economic social and environmental im- vate investment that optimizes use of the integrated planning and investment. The ecom, sca and envronmental iu- resources of the coastal zone while con- Bank is assisting in the development and pacts, and where increased Bank sup- serving vulnerable ecosystems and implementation of the Maputo Corridor port may be effective. coastal and marine biodiversity; estab- Development, the Lubombo Spatial De- lishing and strengthening protected ar- velopment Initiative, several Trans- This article was prepared by Nathalie Johnson of eas management; providing training and fervation areas, and the the Africa Techlntical Families: Environmient. pulcawareness; and providing monm- frnirCnevto ra,adte (202) 47.3-.3765, fax (202) 47.3-8785. APFR pubinc anevaluan. Swaziland Biodiversity Conservation websitc- "p .- 1 .'i , rldbank. org/afr/ toring and evaluation. and Participatory Development Project. afr.nsf ANNUAL REVIEW - JULY 1999-JUNE 2000 (FY2000) 33 - it~_ ',_ __ ___ Cambodia China East Asia and Pacific East Timor Fiji . - r-r- ~~~~~~~~~Indonesia -t - - Kiribati Korea, Republic of -s Lao People's Democratic Republic Malaysia Marshall Islands ' .~ -':~~ - Micronesia, Federated States of ; i Mongolia ,, ~~~~~Myanmar Papua New Guinea Philippines Samoa I , , *- - ?6 Solomon Islands -- Thailand Tonga Vanuatu Vietnam WF - % ~ ~ ~ ~~~~~~~~~~~~ ' 'a' " Y; I-~~~~~~~~~~~A i~~~~~~~~~~~~~- ' _ - -;X -s _- ; ;I -Ejt EItItk Natural resources have sustained the people of East Asia for many centuries and formed the backbonea of the region's remarkable growth over the '{ast 30 years. _ I n fiscal 2000, the East Asian financial munity involvement and participation in environmental crisis finally abated and the region be- gan to emerge from its worst economic To help East Asia meet these challenges, in addition to tradi- coI in m o d e r n ti o n ational lending, the World Bank has developed partnerships collapseinncdrtimes. How , the resumption of s on specific themes such as the CGI-Indonesia Forestry Policy t-imned economin. - owth remains dependent on natural re- Dialogue (see Box, top of page 35) and the Korea-World Bank sources, and therefore needs to be based on greater attention E to and better husbandrv of the region's remaining resource base. sharorea' experien (aojembe of was inhidus- share Korea's experience (as a member of OECD) in indus- trial pollution abatement with other countries. EAP also com- For East Asia to put more emphasis on the quality of growth mitted $1.2 million to expand the safeguards work program rather than on its magnitude, it faces three main challenges. and established a Safeguards Review Team (SRT) to manage First, it must maintain and enhance investments that will im- the core social and environmental review and clearance work prove the environment of the Asian megacities and other ur- for the region (see Box, bottom of page 35). ban areas through reductions in air, water, and solid waste pollution. Second, it must reverse the present degradation of Following concerns raised by NGOs over the compliance of its forests, marine ecosystems, and watersheds. Third, it must the Qinghai component of the China Western Poverty Re- harness the impetus for change that has emerged from the duction Project with the World Bank's safeguard policies economic downturn and promote opportunities for local com- and procedures, the Inspection Panel conducted an investi- 34 ENVIRONMENT MATTERS * 2000 THE CGI-INDONESIA FORESTRY POLICY DIALOGUE to East Asian countries with a combi- nation of lending and nonlending in- From the early 1970s onwards, the Government of Indonesia regarded the large natural struments. During fiscal 2000, EAP forests of that country as an engine of economic growth. By the end of that decade, large volumes of logs were being harvested and exported, primarily to Japan, to supply launched 10 new operations and con- the plywood manufacturing sector in North East Asia; official harvest estimates were tinued mainstreaming environment in about 19 million cubic meters per year. At this point, there was growing interest in con- County Assistance Strategies (CAS) and verting to a policy of manufacturing plywood and other products in Indonesia. It was even argued by some that this would also reduce the pressure on the country's natural economic sector work in countries such forests, because the transformation was to be achieved by a total log export ban. as Thailand and Indonesia. Further- Under the protection of the log export ban and other fiscal and trade policies highly favor- more, the Region is contributing to the able to the developing industry, the value of manufactured exports rose rapidly, from World Bank Group's Environment Strat- about $200 million per annum in the early 1980s to more than $9 billion by the mid- egy with an EAP regional environment 1990s. It became apparent that the capacity of the manufacturing industry was far larger strategy. than the sustainable output of log volume from the natural forests. Poor monitoring and enforcement of regulations by forest agencies resulted in deforestation of natural forest areas originally designated for logging. The most recent figures in Indonesia show that Natural Resource Management. After com- deforestation has been proceeding at a rate of about 1.6 to 1.8 million hectares per year. pleting a 10-year retrospective of natu- The CGI-Indonesia Forestry Policy Dialogue originated from Indonesia's request for ral resource management (NRM) budgetary support from the IMF and World Bank in the wake of the financial collapse. experience in the region in fiscal 1999, Through a two-pronged approach, it is intended to further the reforms started in the the environment and social development Ministry oF Forestry and Estate Crops in the late 1990s. First, it attached a set of environ- mental and natural resources policy and management conditions to the World Bank sector unt (EASES) iS currently formu- Policy Reform Support Loan-I & 11 and Letters of Intent of the IMF. Second, in the lating a medium-term NRM strategy for context of monitoring the implementation of these conditions, the World Bank embarked East Asia to help the Bank rededicate it- upon a consultative process to deal with complex forestry issues. Dialogue and consen- self to olic and sector research to raise sus led to the preparation of a National Forest Program and to working within the part- t y nerships that were developed among the World Bank, bilateral donor agencies, and natural resources issues more consis- NGOs active in forestry. tently within the CAS and expand NRM policy interventions beyond the rural gation. After considering the findings of The environment development portfolio. Some of the les- the investigation, the recommendations . sons emerging from the NRM review are contained in the Bank's management re- portfol1o being integrated into several forestry port responding to those findings, and projects currently under preparation, the deliberation of the Board of Directors, In the context of severe economic, envi- including the China Natural Forest Pro- the Chinese authorities announced that ronmental, and political/institutional tection Project. Furthermore, land titling they intended to use their own resources shocks in East Asia in the past few years, efforts continue in Cambodia, Indonesia, to implement that component of the the Bank has maintained its commitment Thailand, and Laos to ensure responsible project. SOCIAL AND ENVIRONMENTAL SAFEGUARDS IN EAST ASIA There were two main components of the EASES Safeguard Review Team (SRT) work program in fiscal 2000: (1) strengthening training; and (2) increasing supervision of safeguards implementation in the field. On !raining, the SRT developed and delivered a modular safeguards training program to all HQ-based sector and country units in the region as well as to the staff of the major resident missions in the region. The SRT also worked with the World Bank Institute on developmenl of comprehensive safeguards training materials being developed for the Bank as a whole. Regarding safeguards imple- menlation, the SRT provided extensive support for project preparation and supervision, with particular attention to highly sensitive prolects Presence in the field was also increased substantially through recruitment of staff in the World Bank Offices in China, the Philippines, and Vietnam. The SRT also developed a biodiversity toolkit, which was posted on the Bio-node and EA web sites to help improve coverage of biodiversity issues in EA. A technical paper on water quality modeling was prepared and will be published later this calendar year. Finally, a portfolio risk assessment for the Philippines assessed environmental compliance and specified actions to enhance project environ- mental quality and reduce environmental risks in the country portfolio. ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 35 Projects Active during FY2000 with chiller replacement program will be de- The intoniesiai Environmental Expenldlitulre Significant Environmental Objectives veloped to replace an additional 420 Review (EER) represents one of the most GEF/MP chillers. The China Ozone Depleting innovative country-specific studies done 9% 9., Natural Res./ _ ,, _t,al EnyMgt. Substances (ODS) IV Project, a sector- in the region. The review, an initial step *and performance-based umbrella pro- toward an environmental analysis of the ject, is supported by the Multilateral government budget of Indonesia, pre- Fund (MLF) to the Montreal Protocol sents a policy-relevant method for (MP). The current sectors under imple- analysis of public environmental expen- - w __>. mentation are the halon, mobile air con- dlitures; charts national and regional ex- eUlluho6 - . ditioning (MAC), and CFC production penditure trends during the period 6gb. EiL. MgL I-m~ Inaotional 56% 2%o sectors. With the introduction of many 1994-99; and drawvs international com- ODS policies and regulations either al- parisons with the 1997-99 crisis period. readv in place or under consideration, The EER shows that public expenditure and sustainable use of natural resources China remains on track to meet its obli- for essential environmental services has at the community' level. gations as scheduled. China has re- been generally very low over the past ported successful compliance to freeze five years and has further declined since Community7lEl-Based Prograiits. The Metro- pre ucsflcmlac ofez .production and consumption of ODS in the economic crisis. This indicates that polgtan Environmental Improvement 1999 to the average production and con- opportunities to prevent future environ- Program and Vietnam n iP-Haiphon sumption levels of 1995 to 1997. mental damage and potential adverse Thailand and Vietnam. MEIP-Haiphong, impacts of resumed economic growth financed with Australian and Dutch Trust ector Work. The recently concluded are being foregone. Based on the success Funds, combines citywide environmen- studv on Indonesia Enuironnient and Natu- of the Indonesia reviexv, in fiscal 2001 study on IndLonesia Environmen17)7st andf Noltel- tal assessment and priority setthng with EASES is planning to start a similar re- ral Resolrces Manmageent in a Time of Tran- commuinitv-based pilots. Funded by an gement in a Tiiiie of Ti- search exercise for both the Philippines Sitionz provides an update of the state ot ASEM grant, MEIP Thailand is now ac- and Thailand. tive in Phitsanulok, Songhkla, Non- the environment and natural resources thaburi, and Nakorn Ratchisma. These in Indonesia in light of the economic and The first analysis of the mining sector in .T finstitutional crisis of the last three years. cities have already identfied their more i the re ;,' -- ,.I . 1;;;d time Environinent pressing environmental needs and the Th re po y t t in Indonesia7: Lon,g-tern;z Trends amid Reper- community-based organizations that are issues in terrestrial resource use, with ISSioIIs of the Asia;; Economic Crisis- best suited to execute them. particular attention to the relatively re- shows that the mining industrv con- source-rich provinces outside the island tributes over $5 billion annuallv to the Thlc GEF Portfolio. There are currently 15 of Java Its format varies from a progress economy, but the environmental and so- GEF projects under implementation in report on the policy dialogue on prior cial damages of mining cost about $500 the region, including eight biodiversity ity issues, to expanded environmental million annually. In addition to social projects, six climate change projects, and policy analysis of issues that have be- ills and conflicts, damages include dis- the Mekong River International Waters come newly salient since the onset of the turbance to land and ecological re- project. The Chiller Replacement Project economic crisis. It also investigates the sources; long-term damage from acid will assist Thailand to improve energy nexus between sustainable resource use rock drainage and mercury contamina- efficiency, reduce GHG emissions in the and governance issues, with particular tion; and water quality impairment. The building chiller sector, and reduce con- attention to decentralization of environ- report suggests strengthening the exist- sumption of ODS by assisting the GoV- mental and natural resources manage- ing institutional framework to ensure ernment of Thailand to replace 24 ment. Indonesian professionals have the long-term sustainability of mining low-energy-efficiency chillers. Based on made substantial contributions to vari- while the country is undergoing impor- the results of this pilot, a larger-scale ous parts of the report. tant economic and political changes. 36 ENVIRONMFNT MATTERS * 2000 Environnment Moniitors for the Phlilippines purposes; the extensive, grant-based fi- vantage. In Vietnam, one of the CDF pi- and Thiailand present a snapshot of key nancial support that is available lot countries, donor coordination efforts environmental trends in the two coun- through bilateral aid agencies; and the have demonstrated both the benefits and tries. The Monitors are a companion to limited absorptive capacity of environ- challenges of the CDF. Especially for en- the recently published environmental mental institutions. vironment, it has helped to eliminate sector notes, which set out the priorities multiple donors pursuing the same ac- for improving environmental quality Solving pollution problems in the region tivities. However, different objectives and natural resources management in will require significant investments. and institutional systems of donor agen- both countries and describe key envi- Whether EAP is able to participate in cies can also slow down the effectiveness ronmental changes. The Monitors at- these investments depends on the com- of such partnerships. tempt to set baseline trends in various petitiveness of the World Bank's re- environmental indicators associated sources. There is a growing feeling To help East Asia build a more environ- with air and water mentally sustainable quality and natural F - future, EASES plans to resources conserva- . ,, focus on (a) improving tion. Subsequent is- ; livelihoods through sues, to be published - ,F sustainable natural re- annually, will focus & , sources management; on selected environ- i :4 - (b) fostering institu- mental topics of cur- TM tional development rent interest for both : |- and helping countries countries. in the region imple- t ~~~~~ment decentralization - . * i - 1111 - of environmental man- Challenges S - _agement; and (c) in- head ~ ~~~~~~~~ ~~~~~~~~~~~~~~~~creasing public Despite the significant participation and Despite the significant (% ,envi-ronmental aware- portfolio of environ- ness through new ment projects in the X > _ 2 .* approa-ches to pollu- EAP region, this has tion prevention and been a difficult area p abatement and public for the Bank to pro- F' ': ri..- p information disclosure vide financial sup-prgas port. With the possible. A student in China, elephants in northem Thailand and the harvesting of rice in southem Thailand. exception of water supply, many countries in the region be- among many countries in the region that lieve that environment projects do not the conditions attached to the Bank's have high rates of return, and thus re- funds make them less attractive than quire government subsidies, other sources of funding. To operate concessional financing, or grant re- under the Comprehensive Development sources. Furthermore, opportunities for Framework (CDF), it will be necessary lending for environmental institutional for the Bank to work more closely with Thzis articlc wvas prepared by Giovanznra Dore of development are limited by the willing- other donors and select activities in tilc East Asia and Pacific Region, (202) 473- development ~~~~~~~~~~~~~~~~~2934, fax (202) 522-1666. EAP webs ite- ness of governments to borrow for such which the Bank has a comparative ad- ! . ''"'I :, .' .rg/eap/eap.nsf ANNUAL REVIEW * JULY 1999-JUNE 200o1 (FY2000) 37 Albania Europe and Central Asia Region Azernaijan Belarus Bosnia-Herzegovina Bulgaria Croatia Czech Republic Estonia Georgia Hungary Kazakhstan Kyrgyz Republic Latvia ^ ~~~~~~~~~~~~~~~~~~~~~~~~~~Lithuania Macedonia, Former Yugoslav .S. ~~~~~~~~Republic of Moldova i~~~~i7I ~~~~~Poland .5, t wF-t J 1 J s Romania Russian Federation ; __47 1 M;,_ i Slovak Republic Slovenia Taiikistan Turkey iw A91 - 0 fl 9 , t;.i^ tTurkmenistan 411AIM 0 ~~~~~~~~~~~~~~~~~~~~~~~Ukraine Uzbekistan In this region 61 million people in 57 cities are exposed to severe air pollution. Uzbekistan. ountries in the Europe and Central The region still has important environmental problems. Air quality has often not improved in proportion to the fall in Asia (ECA) region, with the excep- emissions. In 57 cities in the region, 61 million people are tion of Turkey, are dealing with ma- still exposed to severe air pollution. This is because emis- sions from small sources such as cars, stoves, and small boil- jor tocial anid economic changes. Since the early 1990s, most ers have increased, even though emissions from large sources *-Ountriei havt,: seen dramatic declines in their GDP and sharp have fallen. Poor water resource management, particularly increases in poverty, albeit from an initially low base. relating to irrigation, affects the livelihoods of some 30 mil- lion people. Deteriorating infrastructure and lack of funds Pollution levels have fallen, largely because of the drop in for operation are causing an increase in water-borne diseases. industrial production. If economic growth resumes, most Increasing poverty and sharp rises in utility prices are put- countries can expect pollution levels to increase too. In some ting pressures on natural resources (for example, fuelwood) countries of Central Europe, however, the economy has in some parts of the Newly Independent States (NIS-the grown, yet pollution has remained stable. This is because states emerging from the dissolution of the former Soviet the composition of industry has changed, new owners have Union, except for the Baltic Republics) and the Caucasus. invested in modern production technology, and countries D have applied good environmental policies, eliminated mar- Rlegional divergence ket distortions, and invested heavily in environmental Over time, different groups of countries will emerge. One infrastructure. group is focused on joining the European Union (EU). This 38 ENVIRONMENT MATTERS * 2000 gives them clear goals for future envi- million, which is about 66 percent of the supported by a Bank loan and a GEF ronmental policies, although implement- total cost of the projects. grant. It will reduce air pollution from ing them will be administratively and local coal-fired space-heating boilers by financially costly. The standards require In late fiscal 1999 and fiscal 2000, the increasing use of clean sources such as annual public expenditures on invest- Bank board approved three self- geothermal heat and natural gas. The ment, operations, and maintenance standing environmental investments (in proposed improvements in air quality equivalent to 2 to 15 percent of current Bulgaria, the Russian Federation, and are expected to improve the health of GDP, which will require major decisions Tajikistan); three environmental projects local people and also reduce damage to about phasing, financing, and cost recovery co-financed by the GEF (one in Georgia neighboring national parks and pro- and two in Poland); and five stand-alone tected areas. A second group of countries, mainly in GEF grants for projects in Central Asia, the NIS, have identified their environ- Croatia, Macedonia FYR, Slovak Repub- The Poland Rural Environmental Pro- mental priorities and are now facing the lic, and Turkey. IBRD, IDA, and GEF tection Project is also supported by both challenge of implementing them. Sev- funds committed to these projects the Bank and the GEF. It will reduce nu- eral countries are coping with the con- amount to $181 million, or about 63 per- trient runoff from agriculture, which sequences of war and extreme poverty cent of total project costs of $290 million. leads to eutrophication of water bodies They lack basic environmental infra- and pollutes groundwater. The project structure, and are seeing increased pres- The Bulgaria Environment and Priva- will train local agricultural extension sures on natural resources. tization Adjustment Support Project agents to promote environmentally re- aims to improve environmental condi- sponsible farming practices and will fi- World Bank activities tions by integrating environmental con- nance environmental investments on cerns into the process of privatizing farms. Defining a portfolio of "environment" highly polluting enterprises. It will do projects has always been somewhat ar- this by reforming environmental legis- The Central Asia Biodiversity Project, bitrary. Initiatives with important envi- lation, establishing a consistent frame- supported by a GEF grant approved late ronmental effects tend to be imple- work for considering environmental in fiscal 1999, is designed to protect mented in traditional sectors such as ru- liabilities, and accelerating Bulgaria's vulnerable and unique biological com- ral and urban development, water and harmonization with EU environmental munities within the West Tien Shan. It sanitation, transport and energy, rather requirements and practices. will help the three countries in the than in environment projects. Sound en- project area strengthen and coordinate vironmental management is one of sev- An IDA credit will support the Tajikistan national policies, regulations, and insti- eral conditions for sustainability. Hence, Lake Sarez Risk Mitigation Project to help tutional arrangements to protect it is more meaningful to aim for envi- alert and prepare vulnerable people for a biodiversity ronmentally sustainable outcomes from potential outburst flood from Lake Sarez all activities rather than to develop en- and for smaller-scale natural disasters that In Macedonia, the GEF-supported Mini- vironment projects. occur frequently in the project area. Hydropower project will reduce emis- Nevertheless, certain interventions (see The Georgia Agricultural Research, Ex- Projects Active during FY2000 with Pie Chart) have objectives that are over- tension, and Training Project, sup- Significant Environmental Objectives whelmingly focused on improving en- ported by a Bank loan and GEF grant, GUEMP Nirunl Re,' vironmental conditions. will develop an efficient and cost- IP.. Rural En Mgi effective agricultural knowledge and in- -. .. 4 The World Bank's portfolio of projects formation system to demonstrate, dis- p9 targeted at improving the environment seminate, and promote the adoption of in the region currently consists of 22 appropriate technologies that increase lending operations in 15 countries.' The sustainable agricultural production and ' Bank finances $652 million out of total reduce pollution from agriculture. l. project costs of $1.1 billion. In addition, P - - the Bank manages 22 GEF or Montreal The Poland Podhale Geothermal District Urn, (ri. M = I Protocol Trust FuLnd grants totaling $217 Heating and Environment Project is IU. I ANNUAL REVIEW * JULY 19c9 JUNE 2000 (FY2000) 39 sions of carbon dioxide by substituting Nonlending activities found that water quantity often matters electricity generated by hydropower for as much as water quality, and found electricity generated from burning fos- In addition to investments, the ECA Re- that including education on hygiene sil fuels. Mini-hydropower plants will gion supports several activities to help practices (hand washing, food prepa- be installed on the municipal water sup- build local environmental capacity and ration) can greatly improve the public plv pipes of three small towns currently understand the causes of environmental health impacts of infrastructure investments. being supplied with water from moun- problems. ECA participates in the Envi- tain springs above the towtns. ronmental Action Program (EAP) for ECA has also tried to look broadly at the Central and Eastern Europe, which since environmental effects of economic and In the Slovak Republic, a project for the the early 1990s has helped countries es- sectoral reforms. For example, as part of Conservation and Sustainable Use of tablish realistic targets for environmen- efforts to understand the effects of utility tal improvements, both on the regional policies on poor people, interesting en- Central European Grasslands has and the national level. For example, ECA vironmental effects have been found. In received a GEE grant to help the supports a regional initiative to help Armenia, electricity prices increased in SloivaksRepublif mintain rpresean- build capacity to value environmental 1999 as a result of sectoral reforms. Both costs and benefits (see Box). In addition, qualitative and quantitative studies show ecosy'stems. ECA has helped two countries complete that around 60 percent of households biodiversity strategies and has programs have increased their consumption of bio- Another GEF grant will support the Tur- to help countries throughout the NIS mass (wood and, in a few cases, dung) to key Biodiversity and Natural Resources btuild institutional capacity for environ- sLubstitute for electricity. This is likely to Management Project, which will help mental management. have important environmental effects, conserve the biological diversity and such as deforestation and soil erosion. ecological integrity of forest, wetland, ECA has studied interventions in rural The increased use of biomass for heating steppe, and alpine ecosystems that are water and sanitation in the region to un- increases the likelihood of health prob- representative of Turkey's major biogeo- derstand the types of activities that im- lems related to indoor air pollution, graphic zones. prove people's health. The studies which is one of the main killers of poor people in the developing world. This is IMPLEMENTING PLANS IN ENVIRONMENTAL particularly the case in urban areas, ASSESSMENTS-THE MINING SECTOR where heating systems and buildings One of the most important functions of the environmental community in the World Bank were not designed for burning wood. is to implement the rules on environmental impact assessment. This involves reviewing all proposed investments, assessing their likely impacts on the environment, and devel- The environment oping plans to mitigate adverse impacts or increase potential benefits. Over the last X envi m year, the benefits of implementing these plans were evident in several projects. strategy and The Poland Hard Coal Sector Restructuring Project involved a sectoral environmen i I tal assessment (SEA) that looked at the past, present, and future effects of the hard-_ implementailon issues coal mining sector. It provided an opportunity to look in depth at policy, process implementation, and investment decisions of both past and future operations. The analy- The Bank is in the process of develop- sis had several important impacts. First, it improved the dialogue among the Ministries ing an environment strategy. In line with of Environment, Economy, and the mining companies. It also encouraged a thorough that effort, ECA intends to shift its geo- public consultation process. The analysis highlighted some ambiguity in the legislation graphic focus and concentrate on the and implementation of mining companies' handling of subsidence, which will now be graphi focustand cnc on th clarified. The SEA also caused the authorities to re-evaluate their understanding of the needs of the NIS states and South East- severity of the environmental impacts of salt water emissions. It also suggested alterna- ern Europe. In the EU accession coun- tive investments that would achieve almost the same benefit for one-sixth of the cost tries, the Bank will work in collaboration ($25 million versus $150 million). with the European Union, and will put Learning from this experience, the Bank is now implementing a similar sectoral environ- more emphasis on the countries that are mental assessment for the mining sector as a whole in Romania. This SEA will be more furthest away from joining the Union. complex, with potentially greater impact on the environment because it involves a far larger number of mines and covers gold, uranium, mixed metal, salt, and sulphur mines Implementing the strategy poses several as well as coal. The analysis will deal with past pollution and remediation efforts related difficult challenges for the Region, in- to mine closures. c cluding the linkages between poverty 40 ENVIRONMENT MATTERS * 200(0 III V 0WM 0R - 0 A1 02 in ECONOMIC VALUATION and environmental conditions is some- particularly the case for management of Goverments usually have a much stron- what different from that in other devel- natural resources, where weak institu- ger understanding of the costs associ- oping areas, particularly in urban areas. tions can lead to illegal forest exploita- ated with implementing environmental First, the artificial land-use patterns and tion, encroachment on protected areas, regulations than the associated benefits rigid housing market of the past mean and fragmentation of monitoring efforts or the costs of inaction. Assigning val- that areas within particular cities tend due to poor coordination between agen- ues to benefits and costs can strengthen environmental agencies' dialogues with not to be dominated by different income cies. But it also affects permitting sys- other authorities. It can enhance public groups. Poor and nonpoor people tend tems (such as environmental impact awareness of the trade-offs between en- to live in the same places. However, as assessments) and efforts to protect re- vironmental and other measures. Agree- ment on methods to value the costs of housig markets are beginng to de- sources where the benefits will only be past environmental damage can help in velop, especially in Central Europe, we seen over a long time horizon. Strong the process of prioritization. can expect to see such differentiation. At public institutions and good gover- that point, bad environmental conditions nance are lacking in many ECA coun- Toward this end, the Bank is contributing to a comprehensive capacity-building may affect poor people disproportion- tries, and these are often the ones with activity that aims to: ately. Second, access to utility services the most urgent environmental prob- * Elaborate practical guidelines for is quite widespread in the region, com- lems. studies of the economic costs and pared to other countries of similar in- benefits of environmental programs come levels. The quality of that service, This poses a conundrum-how to help in the NIS * Enhance the capacity of envi- however, varies widely, and rich custom- countries improve their environmental ronmental authorities to apply ers are better able to cope when service management in the absence of certain modern valuation methodologies breaks down. Third, the region has many basic institutional structures, when civil and to use the results for budget towns and cities built around highly servants are paid low salaries, when the allocation and communication with mainstream ministries. polluting industries. In these areas, we judicial system is impossibly stretched, face complex potential tradeoffs be- and when citizens have little faith in the tween employment or other social issues rule of law and public institutions. and environment and the critical role of and environmental conditions. Clearly, environmental staff need to con- good governance. tribute to Bank-supported public sector Gozvernance. Environmental manage- reform efforts. In addition, one possible Poverty-Enivironment Links. In the ECA re- ment activities depend on good gover- approach is to work with civil society gion, the relationship between poverty nance and strong institutions. This is and try to empower people to improve environmental conditions themselves, to * - express their priorities, and demand ser- vices from public institutions. ECA is doing this in a number of community- based natural resource management ac- tivities. We are working with NGOs and local authorities in an effort to change incentive structures and create the con- ditions for poor people to manage natu- ral resources in a sustainable manner. 1. This includes financing from International Bank for Reconstruction and Development (fBRD), the Interna tional Development Association (IDA) and the Global Environmental Facility (GEF). It does not include financ- > (.. ing from the Intemational Finance Corporation (IFC) or - _ ~ .- _ _ -- _ _ ___the Multilateral Investment Guarantee Agency (MIGA). Alanure. if not properly stored. pollutes water iOdies The Bank is itcrking ,n Georgia Poland and Thlis article was prepared by Jtlia Bttcknall of Romania to help farmers incorporate environmental concenis into agncufture-rra,,ling exlensioor agents Europe and Central Asia's Environmiientally & financing manure slorage helping re3sore permanent grasslaend and creating buffer 7trnps on Ihe edge oi (202 473-5323, faxl (202)ai5P22-vloet1t Sector UAt, waler bodies for e-ample. These photos are from the Poland Rural Ent ronmental Prolection Prcitect 2e0ste- 1!3,52 , fa 22 f2 76i4 . rg/eca/ IfBRD and GEF financed) in Oslraleka. Noilh East Poland eca.nsf F ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 41 _ 1 K W _ _ _ _ ___' T Antigua and Barbuda Argentina Latin America a*fl Caribbean Region Bahamas, The ._ Y Barbados Belize Bolivia Brazil Chile Colombia Costa Rica Dominica - Dominican Republic Eastern Caribbean States -M_ ~ ait.Ecuador El Salvador j~Grenada it Guatemala Guyana Haiti Honduras Jamaica Mexico L ~~~~~~~~~~~~~~~~~~~Nicaragua ¶ 1< , -wI> Panama LXW .:. Paraguay St. Kitts and Nevis _t F _ F .˘ St. Lucia St. Vincent and the Grenadines ' S t ~~~~~~~~~~~~~~~~~~~~Suriname Trinidad and Tobago V .11 S Uruguay Venezuela rr~~~~~~~w ~ ;. -. T h e Latini Anierica and Caribbean i V !1t Li['IO L'0I. C I 211 . I,I .- *..u. rI'I Jjl i .1 (LCR) Regioni is highly urbanized, - # ~~~~~~~~~~~~~~1,.-t 7'r. .hllh it', !t `11.11 1- Z-. 1 .1 , :..; I-, 1 '.: , .;! t^ , r- with *75 percent of the region's 500 LIlt -.ll-.;.i i- rI3t ,. l :ih, -c.-i;l h .- '.i-:l' tI d It1 Ilonl inhabitart, h !!;_ c iti- :3 niaL r : .w i I a! : Ir, jh5. 1 j.1111l .7ll11 llt 'i 4-1 j .t f11.l. . .-t l!,, t ! ii, ! l,lt!I - [ the lnlduLItri,.I *'L ..11..- ic..,rli t 'isili bt. rI-.i :iLL.iilit . 1!' On li 11 t. ! t'ir \\ ! It t sd. 11 Ilk ['- It for more than 90 percent of GDP. There is considerable di- the rate of forest loss seems to have stabilized in much of versity within the region, with large differences in terms of South America, although in Central America it has increased the percentage of people living below the poverty line (18 slightly, to about 2-3 percent annually. percent in Argentina, 50 percent in Nicaragua and Hondu- ras) and the percentage with access to safe drinking water The key environmental issues and priorities in the LCR Re- (65 percent in Argentina, 28 percent in Haiti). gion include (a) management of natural resources (water, soils, forests, fisheries, nalural habitats) in areas of both ex- The region has a rich natural resource base that supports isting and new settlement; (b) urban-industrial pollution (wa- livelihoods and ecosystems of global relevance. Environmen- ter, air, solid waste, hazardous wastes); (c) biodiversity tal degradation continues to occur at an alarming pace. Ac- conservation (terrestrial and marine); (d) environmental man- cording to UNEP's recent State of the Environment report in agement capacity at the national, sectoral, and subnational 1998, 6 million hectares of tropical rainforest were cleared or levels; (e) management of environmental impacts of mining 42 ENVIRONMENT MATTERS * 2000 and nonrenewable resources; (f) climate palities, state and/or federal govern- vian communities and organizations in change; and (g) natural disaster pre- ment agencies, private-sector corpora- five pilot zones through a learning-by- paredness, response, and mitigation. tions, and NGOs. To be eligible, states doing process. This will be achieved by must first demonstrate fulfillment of (a) building the organizational and in- Projects aproved in policy reforms representing improve- stitutional capacity of indigenous and f Iscal ments in their environmental manage- Afro-Peruvian communities and organi- fiscal 200 } ment capacity. The higher the level of zations as well as government institu- Cenitral America Land Regnilarizationz fulfillment, the larger the grant a state tions working with indigenous and can receive. Thus, states have a financial Afro-Peruvian peoples; (b) revising the Projects. Rural land issues, which are similar in most Central American coun- incentive to improve their environmeni- indigenous legal framework; (c) financ- tries, arise from profound historical in- tal management capacity. ing the preparation of community devel- equality and failed agrarian reforms that opment subprojects; and (d) providing often lead to civil conflicts. The Bank re- NEP II is an Adaptable Program Loan training and awareness-building activi- sponse to these land issues has been fo- (APL) with three phases. A scoring sys- ties regarding indigenous and Afro- cused on promoting peaceful outcomes, tem measures the aggregate level of ful- Peruvian peoples' issues to government developing transparent mechanisms, fillment of policy reforms by all the and civil society representatives. strengthening property rights and states. When the aggregate score of all streamlining agrarian reform, and sup- states participating in the system is The program's goal is for indigenous and porting better land distribution. Lend- reached, the next phase is triggered and Afro-Peruvian communities and organi- ing operations for land have increased new loan funding can be released. States zatlons to have the capacity to deslgn from a small $0.7 million land titling will be able to apply for more than one dev p, ian manage trown devei- component implemented in the early grant, but only by progressing to a higher ont initiaive en pjts, provid- 1990s to 10 current operations approved level on the reform matrix. inse omnities pwi reat for $262 million. Another five stand- sense of ownership and empowerment in managing their own development and alone land operations for about $220 Brazil Energy it7; ;ll, Project. This is an i ng to duc elthe eneed million are in the pipeline. Adaptable Program Loan and GEF grant direct interventions by government (totaling 358 million in the first phase) entities. Brazil NEP II Project: The Brazil Second that is designed to reduce energy de- National EnvironmDental Project (NEP mand and greenhouse gas emissions and Costa Rica Econiarkets. In fiscal 2000, the II), approved in December 1999, builds toecnt on some of the successful features of the postpone construction of new generat- World Bank approved a $33.9 million First NEP. One of these features is com- ing capacity. It will include demonstra- loan that-together with an $8 million munity management of environmental tion projects in eight states, activities to Global Environment Facility grant-will munits. managermthent proj environmentats facilitate their replication, and capacity support Costa Rica's National Forestry mayrequest grant support fromethe Ms - building. The first phase will demon- Financing Fund (Fondo Nacional de istry of Environment for subprojects strate cost-effective measures in the elec- Finaniciamiiiento Forestal, or FONAFIFO). aimed at the protection or sustainable tricity subsector through load manage- use of an environmental asset that has ment and targeted peak period redUC- Projects Active during FY2000 with been determined to be a high priority in tions so as to better utilize existing fa- Significant Environmental Objectives that state. Environmental assets are de- cilities; enhance standards and labeling W!u!hI Pe, fined as features of the natural or built programs; and set up a market-based z'lMun Env lgri. environment that provide services to support structure for energy service . human communities; some examples are companies. Phase II anticipates a 13 per- the air-shed above a city, a body of wa- cent reduction in energy demand by ter used for fishing or potable water, or 2015. a conservation unit such as a nature PIlIuiion _ preserve. Indigenous Peoples' Development Project. 50" . = t.'l The objective of this $5 million Learn- . Typically, grants will be made to stake- ing and Innovation Loan (LIL) is to 9i!ltlln31 holder coalitions consisting of munici- strengthen indigenous and Afro-Peru- ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 43 This fund provides financial incentives Mediumnl-Size Projects. Seven medium-size ing the Mesoamerican Barrier Reef Sys- to small- and medium-sized landown- projects (MSPs) also were approved in tem (MBRS). This Bank/GEF-financed ers to conserve primary forests, encour- fiscal 2000, including two in Peru (Col- project, now in the final stages of prepa- age sustainable management of laborative Management for the Conser- ration, focuses on transboundary issues secondary forests, and promote refores- vation and Sustainable Development of that require regional solutions. A main tation efforts throughout Costa Rica. the Noroeste Biosphere Reserve; Par- objective of the project will be to assist ticipatory Conservation and Sustain- the littoral states of Mexico, Belize, Gua- The Ecomarkets project-a partnership able Development with Indigenous temala, and Honduras to strengthen and with the Government of Costa Rica, the Communities), one in Colombia (Con- coordinate national policies, regulations, Bank, and the GEF-aims to encourage servation and Sustainable Use of the private owners of small- and medium- Marine Reserves of the Archipelago of and institutional arrangements for the sized parcels of ecologically valuable San Andres), one in Ecuador (Choco- conservation and sustainable use of this land to adopt or improve sustainable Andean Corridor), one in Guatemala global public good. forest management practices, as well as (Management and Protection of Laguna to launch reforestation efforts using na- del Tigre National Park), one in Mexico The project is designed to (a) strengthen tive tree species. It seeks to protect up (Sustainable Hillside Management in existing marine protected areas (MPAs) to 150,000 hectares of forests across Indigenous Micro-catchments in and establish new ones in transboundary Costa Rica over the next five years. Oaxaca), and one in Uruguay (Landfill locations within the MBRS; (b) develop Mexico Rencroablc Energyi for Agricufitere Methane Recovery Demonstration and implement a standardized regional Project. This project is designed to pro- Project). monitoring and environmental informa- mote the use of renewable energy tech- tion system for the MBRS; (c) promote nologies (wind and solar) for productive rojects under measures to reduce unsustainable pat- purposes in the agriculture sector. Prects terns of resource use, focusing initially Project components include (a) a promo- r r on the fisheries and tourism sectors; and tion campaign targeting renewable en- Cenitral Ame rico Bamrici Reef The objective (d) increase local and national capacity ergy for agriculture; (b) training to of this regional project is to enhance pro- for environmental management through technicianls, agricultural extension ex- tection of the ecologically unique and education, information sharing, and perts, and energy system vendors; (c) in- vulnerable marine ecosystems compris- training. troduction of technical specifications and certi- - fication procedures for- farm-based energy equip- ment; (d) installation of - l I 1: - __ *j solar and wind-powered water pumping sys- tems, and solar powered , refrigerated milk stor- q - age tanks, for participat- r ing farmers as demon- ___ - U stration units; (e) techni- - _ t v cal assistance to advise - farmers on the new en- ergy operation proce- dures; and (f) in four states, a pilot program to test innovative ven- dor financing mech- anisms for farm-based energy systems. Fishermen, Mexico. 44 ENVIRONME\T MATTERS * 21100 l l * * l les | f -s ie S The project (totaling $17 million over five cluding ecosystem mapping, environ- NEW ENVIRONMENT STRATEGY years, including $10 million from the mental management, vulnerability as- UNDER DEVELOPMENT IN LCR GEF) has been designed as the first phase sessments, and the development of a of a 15-year program to implement the communications strategy. Within the general framework of the Action Plan for the Conservation and Bank's new corporate environment strat- egy, the Latin America and Caribbean Sustainable Use of the MBRS-a regional The Central American Commission on Region is preparing a regional environ- strategic framework developed in col- Environment and Development (CCAD) ment strategy. The work-in-progress pro- laboration with partners in the region and the Bank are working together to poses strategic criteria that will provide and with the full support of the littoral consolidate and mainstream the MBC by a reference point to assess future states. The project is expected to go to mobilizing resources to cover the costs the Board in early December. of connecting the multiple ongoing ac- An extensive external consultation effort tivities at the national level, promoting is under way. This includes (a) web- ep * . .,. ,. based consultations from August 2000 pecl initaives public-private sector partnershps, and through early October2000 (please join increasing the awareness of both the lo- the discussion at http://wblnOO18. Mesoamerican Biological Corridor. The cal and international communities about worldbank.org/lac/ENVStrategy/AR/ Mesoamerican Biological Corridor the value of the MBC initiative. cover.nsf); (b) e-mail consultations to a (MBC) encompasses nearly 30 percent of large targeted audience of NGOs, the private sector, academia, and govern- Central America's territory, linking eco- The Pilot Program to Conserve the Brazilian mental agencies; and (c) smaller regional systems, indigenous communities, and Rain Forest (PPG-7). This is a joint effort working sessions with key policymakers private lands in the longest continuous of the Brazilian government, Brazilian in the second half of September. Venues multinational sustainable development civil society, and the international donor for the latter sessiong Mexico and Cen- initiative in the world. Although it be- community to reduce deforestation rates tral America); Santo Domingo, Domini- gan as an effort to connect various na- and promote sustainable development can Republic (covering the Caribbean); tional parks, it is now becoming a in these forests, which are critically im- Cartagena, Colombia (covering the driving force behind the integration of portant for biological diversity and eco- Andean Countries); and Rio de Janeiro, development priorities and environ- system services such as carbon mental agendas for the entire Central sequestration. Initiated in 1992, with first American region. The concept of the projects begun in 1994, it underwent in- continuing on the technical and financial MBC has been evolving in the last few stitutional reform subsequent to the par- measures necessary for implementation years from a focus on biodiversity con- ticipants' meeting in November 1999. of the Action Plans in the cities of Lima- servation to a broader sustainable devel- While the Bank retains its fiduciary role, Callao and Rio de Janeiro. opment framework. the new arrangements provide for greater Brazilian leadership and owner- In fiscal 2000, two workshops were held The MBC is one of the world's most bio- ship. Among other activities, the Sustain- The first, in Rio de Janeiro, focused on logically diverse areas, and on this ba- able Business Practices Project, which air quality in the metropolitan area. The sis offers investment opportunities for promotes sound business practices in the second, in Buenos Aires, considered pri- the region ranging from ecotourism to private sector, and the Atlantic Rain For- orities for better air-quality management pharmaceutical prospecting. est subprogram are being designed for and the need for intergovernmental co- early implementation. ordination. Further, collaboration is un- The Bank is preparing and supervising derway between the World Bank and U.S. national and regional IBRD/IDA/IDF Cleani Air Initiativie. The main goals of the Environmental Protection Agency to projects for almost $200 million that are Clean Air Initiative in Latin American jointly develop an Air Quality and Trans- related to the overall MBC initiative. The Cities are to (a) promote the develop- portation Toolkit, and with partner Bank serves as the implementing agency ment and enhancement of clean air ac- Daimler/Chrysler for creation of an In- for nearly $40 million in ongoing national tion plans; (b) advance the exchange of formation Pool for Clean Technologies. and regional GEF grants, with another knowledge and experience among all Thlis article was prepared by Teresa Serra, (202) $50 million in the pipeline. In addition, partners; and (c) foster public participa- 473-5754,fax (202) 676-9373, and Tom Lovejoy the Bank has provided more than $6 mil- tion and the active involvement of the (202) 458-7 837. oft/ce Latin Amtiericant and Caribbeanti --- . Oic Environment Famnily. lion in nonlending service activities to private sector for the accelerated intro- LCR website- 1 i , .' ', ' worldbank.org/ support consolidation of the MBC, in- duction of cleaner technologies. Work is external/lac,lac.nsf ANNUAL REVIEW - JULY 1999-JUNE 2000 (FX2000) 45 Ml;t and lNorth Africa Region Bahrain Middie Djibouti ' , .. Egypt ..- Iran, Islamic Republic of .g T,e *, |00,. Israel is Jordan - r . ; ^ k Kuwait Lebanon Libya Malta Morocco X ' Oman - Qatar K I Saudi Arabia - Syrian Arab Republic Tunisia United Arab Emirates Yemen West Bank and Gaza L..ai~~aimd i; ;˘.a. b #'' t_1. s I _ j !- . ____ _ ______ _ A s part of the World Bank's overall > Mainstreaming environment into all World Bank work, / parto h ol aksoealprticLularly iri those sectors of key envTironmental effort to establish a corporate envi- concern in MNA-water resources management, soil ronmenit strategy, the Middle East degradation and desertification, waste management ind NOI [h .\rica (I [lNA) Region recenitly began to revisitits transport; Strengthening national capacity for environnmental -'OOOWL'lltOI StrotL'4t/fo tlir' Midde East mid t~;*Ui Afrii R~'safeguards and for monitoring and enforcement; ironmcliistal Stra7tcgyfi;r tilcMifl6tllt Enst ,7lztl No9l-tlAfricn ,'ill Strengthening partnerships for addressing regional and to ensure its continued relevance. This process is on-going. global issues,- and After detaiked consultationi wvith bothl governiment and civilgkbIise;an A Focusing on environmental education and awareness as society in the MNA countries, it is expected to be completed well as ilving civil society and \GOs in designing in the late fall of 2000. The initial findinigs indicate that, witil and implementing environment-related projects. minor adjustments, the 1 99)5 Strategy still points in the right direction through its three-pronged approach: (a) improx- The B lending portfolio ing natural resources management; (b) arresting emerging pollution prOblems; and (c) strengthening environmental For MNA in fiscal 2000, the World Bank approx ed 21 inx est- institutions and increasing pLIblic participation. Hovwever, ment projects for a total of $760 million in loans anld $190 in order to implement the corporate strategy, significant ef- million in either International Development Association forts in the following areas are required: (IDA) credits or special credits to the West Bank and Gaza. 46 F NVIRONMI NT \MLAITFRs * 2o(1) I - I 0 0 One of those projects, Tehran Sewerage, patory, sustainable conservation Nonlending services was in the Environmental Assessment management of the ecosystems (EA) Category A, which requires a com- supported by the project. Fiscal 2000 also saw an increased empha- prehensive environmental impact * Water Sector Investment (Tunisia). sis on mainstreaming environment into assessment. Another 11 were in EA Cat- This is a $100 million loan that the nonlending services that the Bank egory B, requiring substantive environ- promotes effective integrated water provides. Of particular importance is the mental review. In fact, approximately emphasis the MNA Region has placed $500 million of the total $920 million on including environmental staff in the approved in fiscal 2000 includes envi- lishing and implementing a sound dialogues with countries on Country institutional fialogesmwthocontriedoneCuntr ronmental components to be monitored institutional framework and sector Assistance Strategies (CAS) and Com- during implementation. Projects of par- reform measures for demand prehensive Development Frameworks ticular environmental concern approved management, as well as encou- (CDF). In fiscal 2000, the teams drafting in fiscal 2000 include: raging conservation of water the Tunisia CAS and the Morocco, West * Tehran Sewerage Project (Iran). This resources and protection of the Bank and Gaza, and Yemen CDFs pro- is a $145 million category A loan environment, thereby significantly vided excellent examples of the right that will improve environmental improving the productivity of way to mainstream environment. Each conditions by providing satisfactory agriculture and access to safe water of these documents fits into the overall wastewater collection and treatment in rural areas. strategy discussed above by explicitly for about 2.1 million of greater Second Municipal Infrastructure addressing environmental problems fac- Tehran's 8 mimlion people. Development (West Bank and ing the respective countries and outlin- (Algeria). This is an $83.5 million Gaza). This is a $7.5 million special ing priorities for Bank assistance in (Aloeran.Thawil asist in restioring credit that will rehabilitate vital mitigating those problems. loan that will assist in restoring community infrastructure damaged urban infrastructure, including by the December 22, 1999, earth- roads, water, drainage, and sewer- Under the Strategic Compact, the MNA quake in Ain Temouchent and age, and provide capacity building Environment Cluster published A Guide increase national preparedness for for emerging local institutions. for the Preparation and Review of Environ- future disasters. U Social Protection Fund (Yemen). mental Assessnt Reports2 as part of the * Second National Drainage (Egypt). This is a $75 million IDA credit that Bank's overall effort to strengthen envi- This is a $50 million loan that is is aimed at improving the range of ronmental safeguards in national envi- designed to increase the agricultural services and options available to the ronment agencies. Additionally, NINA productivitv of irrigated land by took the lead in developing and imple- poorer sections of the Yemeni menting a program that strengthens the thusravoiding yaiee losnduition population through a combination capacity of EA reviewers both within the waterlvogging aneld soil due sn tion of community development, Bank and throughout the region. As part waterlogging and soil salinization and therebv increasing rural capacity building, and micro-finance of this program, Bank team leaders for incomes. programs. infrastructure, health, rural develop- * First Municipal Development ment, and water projects were all trained Project (Lebanon). This is an $80 Projects Active during FY2000 with on proper application of safeguard million loan that provides Significant Environmental Objectives policies. community-driven municipal infra- GWVMP Ntaural RrV structure, particularlv targeting ' -' Rural Er. MgL Additionally, the National Environmen- poor communities, and helps the . tal Action Plan (NEAP) for Syria was government develop a longer-term completed. The Algeria NEAP is on- municipal development strategy. going and is expected to be completed * Protected Areas Management . early in fiscal 2001. Both NEAPs are Project (Morocco). This is a .!Il,ll,.ins -- w | | based on the overall MNA Strategy and $9 million Global Environment U'b Er., Mgr .; make specific recommendations for im- Facility (GEF) grant that establishes s"u ok * < proving the environment and promoting a system of protected areas in I'- riional sustainable development for each of the Morocco and promotes partici- countries. ANNUAL REVIEW J JULY 1999-JUNE 2000 (FY2000) 47 Regional programs . The Small Grants Facility for NGOs rigation, and agriculture), university pro- saw the successful implementation fessors, and NGO representatives from The Mediterrnnean Enviromnnental Tech- of grants to four NGOs in Lebanon, the region conducted an open discussion niical Assisteance Pogram (METAP3) con- which joined Turkey as the second on groundwater policy, regulatory ap- tinues to function as an instrument for country to benefit from this pilot proaches, and ways to increase bottom- operationalizing the MNA environment initiative, which also plans activities up participation. strategy, thereby assisting countries de- in Algeria and Jordan. velop sound environmental practices. The Jt.'rr,l Dry Lanids MIanagemrent METAP played a major role in the Alge- More information about METAP can be Project. The "Desertification Initiative" ria and Syria NEAPS. In addition, the found on the World Wide Web at is another effort to bring together coun- METAP Regional Facility (MRF) in www.METAP.org. tries to exchange information and under- Cairo, Egypt, is working with each of the take research on dry lands. It continues METAP countries on building capacity The MENAIMED Wtater Initiative. Ef- to develop field activities and elicit do- for environmental management and in forts to promote regional collaboration nor support for developing solutions for preparing specific investment projects with the European Union and the Euro- natural resource degradation. As part of like the West Bank and Gaza Solid Waste pean Investment Bank (EIB) in the the Middle East peace process, this pro- and Environment Management Project. MENA/MED Water Initiative are in- gram links scientists and planners from tended to support the formulation and Egypt, Israel, Jordan, Tunisia, and the Regionally, METAP continued to pro- implementation of national water re- West Bank and Gaza so they can share vide training and information-sharing sources management policies in each of experience and expertise in desert land through a wide variety of instruments. the MNA countries. A report on sustain- management. The second phase of the Some of the fiscal 2000 highlights include able groundwater management was pre- initiative was launched in fiscal 2000 and the following: sented at a regional workshop in Sana'a, is expected to continue for the next five S A Regional Solid Waste Study was Yemen, in June 2000. Groundwater ex- years. completed and presented to gov- perts from relevant ministries (water, ir- ernment representatives from the beneficiary countries at an inter- METAP EIA INITIATIVE national conference in Cairo in Februarv 2000, where a follow-on The METAP Environmental Impact Assessment Initiative responds to the need for EIA systems, which are an important emphasis of the Euro-Mediterranean Partnership technical assistance project was and the Bank's own safeguard policies. The initiative, designed to strengthen EIA sys- developed and is being presented tems in the METAP countries, has created an Environmental Assessment (EA) Center to donors for financing, at the International Center for Environmental Technologies in Tunis (CITET). The overall * The MEDPOLICIES Initiative com- goal is to provide the region with a long-term venue for developing south-south and north- south cooperation, EIA on-the -job training, and information dissemination. pleted a series of national case studies and follow-up policy round- During the first phase, the initiative conducted assessments of EA systems in METAP tables on Trade and Environment, countries, including Albania, Croatia, Egypt, Jordan, Tunisia, Turkey, and West Bank and Privatization and Environment, or Gaza. The results from the assessments were used to develop training for stakehold- ers, including environment and sector ministries, private sector consulting firms, and Economic Impacts of Air Pollution, nongovernmental organizations (NGOs). and is now preparing a rapid assessment of the "Impacts of In November 1999, the initiative organized an international conference at CITET that Environmental Regulations on included the directors responsible for EA procedures from all METAP Countries. Topics included: Trade." o Presentation of the above-mentioned EA assessments; * The EIA Initiative (see box) completed * Strengthening communications among METAP countries on EA procedures; its pilot phase for analyzing the * Fostering partnerships between METAP countries and donors, between METAP environment assessment systems in projects, and between countries interested in the same environmental themes, such as Mediterranean coastal preservation; and several METAP countries and has * Continuing the exchange of information and lessons learned on EA. established a Regional EA Center in Tunis to provide technical support, The Initiative is an ideal forum to identify common concerns and issues related to EA and information dissemination, and to facilitate EA training activities in the regions as well as to disseminate World Bank training, I safeguard policies. 48 ENVIRONMNENT MATTERS * 2000 The Gulf ofAqaba EnvironmentalAction - r1 Plan. This is another peace process ini- . tiative that links Egypt, Israel, and Jor- I_w0Ip dan in collaborative mechanisms to . strengthen capacity to protect marine i biodiversity and the coastal zone. In fis- r4 cal 2000, the Marine Park Action Plan under this initiative was implemented. The Red Sea and Gulf of Aden Environ- mental Strategic Action Program (SAP). r - This $19 million Global Environment .- __ , 1 , fi Facility project is being jointly executed 4"! by the World Bank, UNDP, and UNEP ,- through The Regional Organization for the Conservation of the Environment of the Red Sea and Gulf of Aden (PERSGA), which is based in Jeddah. This partner- ship of the littoral states-Djibouti, 90,- Egypt, Jordan, Saudi Arabia, Somalia, Sudan, and Yemen-and international * A, agencies aims to preserve the fragile en- vironment by preventing pollution and unplanned coastal development in one - of the world's most pristine marine en- .'Iq vironments. In fiscal 2000, the SAP made significant progress towards re-survey- ing portions of the Red Sea and Gulf of . j Aden in order to improve navigation . - safety. J Images from the Middle EastandNorthAfrica, dockwise from upperleft: Auto-repairwork, a windmill, Future challenges gatheringwater, andamoonrise. Environmental mainstreaming work closely with its clients to increase 1. World Bank Report #13601-MNA, February 17, and ensunng compliance the involvement of civil society and lo 1995 and ensuiing compliance cal NGOs in the design and implemen- 2. Copies are now available in English and French. An Arabic version will be available in the coming In addition to participating in the devel- tation of community, social, and educa- months. To obtain copies, please write or email the opment of the corporate environment tional development initiatives. In paral- athor at the address listed below. strategy, MNA's challenge is to translate lel , MNA would continue to strengthen 3. METAP serves 13 Mediterranean countries and is sponsored by the World Bank, the European Com- its strategic statements into directly op- the capacity of its own environmental mission, the European Investment Bank, UNDP, and erational actions. This involves further staff, as well as the environmental staff the Swiss Development Cooperation. METAP benefi- ciary countries ini the MNA region are Algeria, Egypt, efforts to better integrate environment of national agencies, in environment Jordan, Lebanon, Morocco, Syria, Tunisia, and West into the CAS/CDF; providing upstream safeguards. It will also follow up on the Bank and Gaza. technical and policy support to countries implementation of environmental man- and task teams to improve the design agement plans in its operations. This article zoas prepared by J.B. Collier, (202) and implementation of environmental 473-8551 and Sherif Arif, (202) 473-7315, of components in the Region's operations; Middle East and North Africa's Enoironmient and giving special attention to global and Natuiral Resottrces Division,fax (202) 477- 1374.MNAzvebsite-'-' ''''I environment issues. The Region will also worldbank.org/mna/mlena. nsf ANNUAL REVIEW * IULY 1999-JUNE 2000 (FY2000) 49 W - Afghanistan Bangladesh South Asia Region Bhutan i~ $ t 2 Maldives .,' Pak!stan X . Sri Lanka I~~~~~~~II A' 51~~~~~~- -, IE , , a T A 7itli about 1.3 billion people, Environmental problems in South Asia are enormous, rang- UIXI s ^ing from widespread resource depletion and ecological deg- South Asia is home to almost radation to indoor and urban air pollution, urban and Tv v 22 percent of the world's total industrial waste, and natural disasters. For example, in the popwatL,ion Despitc. impressive economic growth in recent case of health issues alone in India, environmental factors year; iaxer?gi!n R1 ; -, percent GDP growth over the past de- play a role in approximately 19 percent of all illnesses and cade), South Asia still has persistent-even increasing- deaths (see Figure, page 51). Environmental health is a major levels of povertv. Between 1987 and 1998, the population liv- health issue, second only to malnutrition and exceeding the . . ~~current impact of other single health threats such as HIV/ ing on less than $1 per day rose from 474 to 522 million, or c about 43 percent of the world's total of 1.2 billion. Similarly, AIDS, tuberculosis, or cancer. On the natural resource side, the population living on less than $2 per day rose from 911 land degradation, deforestation, fishery depletion, and wa- imillion to almost 1.1 billion, or about 39 percent of the 2.8 ter scarcity threaten the livelihood of nearly half the region's billion global total. About 80 percent of poor people live in rural poor. Environmental problems, magnified by the inad- rural villages; amongst poor people, women, tribal people equacy of governance structures in every country of the re- and scheduled castes in India are the most disadvantaged. gion and at all levels, cause substantial loss of life and Of the roughly I billion people to be added to the world's threaten the livelihoods of millions of people. total population over the next 15 years, one third will be born in South Asia-implying that poverty reduction will con- In the South Asia Region of the World Bank, the term "envi- tinue to be the region's most fundamental challenge. ronment" is primarily thought of in terms of the productiv- 50 ENVIRONMENT MATTERS * 2000 The burden of disease in India- emergence of institutions that can help Enhancin ro ect Environmental factors | (percenrage of DALYs lost) empower poor people. Recent Bank ex- (perceA.i hilnra ofbn DALr kfluol perience-such as joint forest manage- quality tnrou Inrar ,A,,i PIIrri,,n Urban ArP.j, ment in India, hill community forestry safeguard po ices 0llr IN7OII3slr in Nepal, and irrigation user groups in I". { i' India, Pakistan, and Sri Lanka-adds to The overall focus in the Region is on en- the evidence that social capital and par- hancing project quality by aiming for the *lr- * > - ticipatory processes are as crucial to pov- most appropriate environmentally sus- Suppri 3nd- erty reduction as financial resources and tainable outcomes. This incorporates, but Sanr[ai.n 5a -',ltl,en development programs. goes far beyond, the more narrow con- cern of simply ensuring compliance with -, r- Non.trronrnewrl The emphasis on social capital develop- environmental safeguard policies. It .1% t3usement is part of our larger regional effort gives importance to greater multi- to support governance reforms that pro- disciplinary brainstorming on initial IJ,,re MWorb.d,r3 ;r.ia f.oll.J[3i erocoarcp ctr se ore. * tEd nCO 3 s.ngl he3Irh ,mp!cE me3sure ;31id DALYI mote the emergence of "home-grown," proect concepts, and to early consider- fd,n.ib,I,, 3d1scred Ide vea,~ii D.1L, are 3 cw,nb.naor, ainofdsgrotostoahee.rae .f 3i dlScO-.:.ed and .gEh,red ieaLr .o fre 3 E 3S transparent, and accountable institutions ation of design options to achieve greater - ;ult jfrI .irt 3te .r-ri Th. .ub-rs , that a be trusted relied by sustainability. Nevertheless, the Bank's oi -crb..Jir, adjusted b., se.err, Thece *,amb-'s are thtcan betutdand reie saegarostmiimmbstn rnore con.er[iu.e t.h3n eir.er eit.nrnes co.'dcaed r; |r poor people. Environmental institutions safeguard policies set minmum "stan- Ehe 1993 Worlid De.rIpmrir Pfp.)p'rr .h,ch ;.&eeied that dards" below which the Bank will not bout 30 percen al ind., s l.:.ss -I DALYs ere the re- in the region (including information sys- cunt .;r en.rc,nmentll u a ,n pecen n get involved (similar to the practice in Ch.r3 and 10 percenr r. thc deweloped -.rld tems and skilled human resources) are any financial institution). particularly weak, and need strengthen- ity and sustainability of natural resources ing in order to more effectively The shifting nature of Bank lending op- contributing to livelihoods; the impact of contribute to development outcomes. erations toward a greater emphasis on pollution on human he'alth; and the func- Community-based natural resource man- programmatic lending has enhanced our tioning of ecosystems to reduce people's agement initiatives, coupled with policy promotion of strategic (sectoral and re- vulnerability, especially of poor people. reforms, are proving an effective mecha- gional) environmental assessments to The South Asia approach is to pick from nism to overcome many of these con- ensure adequate attention to environ- an "environmental toolkit" those tools straints. They can increase access to and mental safeguards and good practice. that best serve the needs of poor people, improve the productivity of natural re- Examples include sectoral assessments and to address other aspects of the envi- sources, and thereby contribute directly for energy reform projects in India and ronmental agenda through effective part- to the growth of community-controlled regional assessments for watershed nerships with other environmental groups assets (see Box). projects in India. The Region is also fo- and donors. This does not imply a value judgment about the merits of other as- FocuSING ON THE RURAL POOR pects of environmental work, only that resources can be expended most effec- Forestry projects in the last decade have demonstrated the ability to target the rural poor through interventions such as community-based forest management, including joint forest tivel by developing systematic partner- management (JFM). Community groups are formed with the express purpose of improv- ships with those better equipped to ing the forest by involving all forest users. Invariably, this will target poor people, tribal pursue less poverty-focused aspects of groups, and landless people, since they are the main users of the forest. JFM initiatives the environmental agenda. have been tried in several Indian states. In West Bengal, studies found that 95 percent of the families participating in JFM were poor in absolute and relative terms and that more than half of the members are from scheduled tribes or castes. In Madhya Pradesh (MP), Governance and about 30,000 villages (40 percent of the state population) are located in or near forests. MP has one of the largest tribal populations in the country; the vast majority depend on forests empowerment for subsistence needs and supplementary income from sales of forest produce. In Andhra Pradesh (AP), 60 percent of the State's forests fall within the "tribal belt" and development Refocusing our environment strategy to concerns are coordinated through the Tribal Welfare Department. The JFM program has identified and formed about 7,000 groups covering all accessible areas of forest, and tribal bettercontributealto povertyood, rducn development has been a cornerstone of the program. Outcomes (health, livelihoods, vulner- ability) also requires supporting the Source: South Asia Natural Resource Strategy 2000. ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 51 cusing on integrating social and environ- ties among central and state govern- degradation, watershed manage- mental assessments, given the inter- ments' environmental staff, municipal ment, and community forestry; a twined nature of the issues involved. development fund companies, and fi- series of projects in Bangladesh Such combined environmental and so- nancial intermediaries. A modest begin- focusing on water resources and cial sectoral assessments for transport, ning is being made in India to strengthen fisheries management; and two urban, and rural development projects the implementation of India's Environ- projects in Pakistan addressing both are now routinely being conducted in the mental Impact Assessment (EIA) policies water and forestry resources issues. South Asia Region. SAR is also placing through the Environmental Manage- In addition, analytical work is being a strong emphasis on environmental ment Capacity Building Project. In Sri pursued to strengthen our under- monitoring and evaluation, taking ad- Lanka, the institutional development standing of rural poverty and vantage of modern information manage- project is supporting the streamlining environment links. ment tools and human resources in the and modernization of the EIA and envi- * Reduce exposure to indoor and South Asia Region. ronmental licensing procedures. In outdoor air pollution; provide Bangladesh, safeguards policy work is access to safe and reliable drinking Also, mindful of the fact that develop- strengthening environmental focal water supply, sanitation, and solid ment aid will not work where policies points in all of the sectoral ministries and waste services; and support mass are inappropriate, and that imposing agencies that impact the environment. hygiene and education programs. conditionalities is not an effective way The portfolio of rural water supply to ensure adequate compliance with the In the future, SAR plans to improve its and sanitation projects has been Bank's safeguard policies, the South Asia portfolio tracking to provide early sig- accelerated in India and Bangladesh, Region of the Bank is placing a strong nals on the implementation of key in part by the striking empirical emphasis on local ownership and con- project-related environmental manage- evidence of the incidence of disease sensus-building among its clients. In this ment plans, and initiate wider sharing and death associated with dirty context, our current activities address the of cross-country and regional experi- water and lack of access to sani- following common generic weaknesses ences by carrying out thematic reviews tation. In addition, the widespread that usually manifest themselves in the and training on the effective implemen- arsenic problem in Bangladesh is region: tation of being addressed both technically * Weak capacity to identify, char- and institutionally through a water acterize, manage and/or mitigate p ct dnlnI ad sector reform process. A growing environmental and social risks Iro ct por.lolo anI program in the area of envi- associated with projects; an aytical worI( ronmental health is described below. * Lack of basic regulatory frameworks U Reduce vulnerability to natural and and adequate institutional arrange- The World Bank's South Asia regional environmental disasters through ments to ensure proper evaluation environment strategy continues to focus support for changes in land-use of social and environmental risks; on achieving poverty-related outcomes planning, disaster preparedness, * Lack of human and financial by supporting initiatives, programs, and community involvement and edu- resources, which often hinder policy reforms targeted to: effective management of envi- * Improve livelihood systems through Projects Active during FY2000 with ronmental and social risks asso- better management and improved Significant Environmental Objectives ciated with project development productivity of natural resources; GEFMP even when relatively advanced legal support for institutional reforms and 9% 0-'-\ Natural Ens.M and regulatory frameworks exist; improved governance; improved Rua 46% and infrastructure and access to agri- * Lack of political will or ability to cultural technology; access to credit enforce compliance with national and energy, education and infor- requirements. mation services; and support for Pollutlnr & initiatives to eliminate the "gender UFb Er.. Mgs Management-oriented training programs gap" and foster inclusive insti- - are being designed to strengthen envi- tutions. Examples include several ronmental and social assessment capaci- projects in India focusing on land 52 ENVIRONMENT MATTERS * 2000 cation, and emergency phase institutional strengthening and reform. state in India), and the revised interventions. Examples are the AP The major thrusts of these technical as- Pakistan Environmental Strategy. Emergency Cyclone Project, the sistance activities are (a) improved in- * Global outcomes. In this area, the focus Bangladesh Coastal Embankment formation as a basis for improved is on improved understanding of the Project, and the GEF-funded regional priority-setting; (b) increased decentrali- overlaps between local and global Bay of Bengal project preparation zation of environmental management to environmental outcomes in both the grant. the state/provincial and municipal lev- climate change and biodiversity els; (c) increased public sector account- areas. Asshowninthepiechart,theenvironment- ability through improved public dis- related lending in South Asia is well dis- closure; (d) increased private sector par- Looking Ahead tributed across the major thematic areas: ticipation and clear responsibilities; (e) 32 percent in the "brown" sectors, 46 strengthened safeguard policies as part The Region's poverty-focused environ- percent in the "green" sectors, 13 percent of the governance and reform agenda; ment strategy is starting to take hold, not for institutional capacity building, and and (f) increased public education on only as evidenced by the listing of cur- 9 percent for global concerns (based on environmental concerns. rent activities but more fundamentally Bank lending levels). New projects this in the mindsets of colleagues within and past year include a large Ozone-Deplet- The South Asia Region's lending for en- beyond the Bank. The emphasis on pov- ing Substance (ODS) Production Sector vironmental objectives is closely associ- erty makes improved knowledge con- Gradual Phase-Out Project in India (the ated with its analytical and advisory cerning how environmental issues affect third such production sector project in work in the region. Topics covered are: the welfare of people in South Asia par- the world, after similar ones China and * Environmental healtlh. A growing ticularly important. There is a high Russia); two GEF-funded projects in environmental health program (in premium on making cross-sectoral insti- Bangladesh (Fourth Fisheries and an collaboration with the Bank's health, tutional connections-not only across the ADB-implemented Sundarbans pro- energy, infrastructure, and rural Bank's own sectoral units, but within ject); and an Urban Development Project units, as well as the U.S. Centers for counterpart governments, and across in Bhutan. Not listed in the table are the Disease Control) is focusing on both donors. newly approved Air Quality Manage- the health impacts and cost-effective ment project in Bangladesh (approved abatement measures for the region's As a result, a long-term priority will be in July, and hence in fiscal 2001), and the main environmental hazards. Spe- SAR's information and knowledge base Uttar Pradesh Fiscal and Governance cific cross-sectoral work was started and communications strategy on how to Reform loan, with a component devoted last year on a Clean Air and Fuels best disseminate that knowledge. The to the environmental aspects of public program in Sri Lanka, and on urban power of internet technologies and pub- enterprise privatization and closure. and rural energy-related issues in lic access is revolutionizing not only India and Bangladesh. Research was work within the Bank, but is offering new One of the most important implications completed on water supply and tools to improve governance, make ef- of the Region's poverty focus is that it sanitation-related health impacts in fective use of resources for decision- requires mainstreaming environmental India. making, improve human resources concerns into sectoral and cross-sectoral * Poverty and environmenit linkages. This development, and empower people in programs. Poverty impacts must be work focuses primarily on case the fight against poverty. This is increas- looked at holistically. Therefore, the studies of rural resource use, the intgly reflected in the Region's work re- region's environment-related lending is economics of interventions, and the lated to industrial pollution, air quality, increasingly integrated with the opera- promise of community empower- forestry management, and water use and tions of the health, infrastructure, energy, ment. river basin management. The environ- rural, and economic management sector * Area-based strategies. This incor- mental sector is indeed one area where units. Compared to the recent past, there porates priority-setting and insti- knowledge, perhaps more than money, are few stand-alone environment lend- tutional and policy reform. Specific will lead to sustainable improvements. ing projects in the pipeline. examples are the State Environ- mental Action Plan in Gujarat, the This article was prepared by Carter Brandon of the South Asia Environment Sector Unit, (202) About 13 percent of the current environ- Environmental Management Frame- 458-2752, fax (202) 522-1664. SAR website - ment-related portfolio is geared toward work in Uttar Pradesh (a reforming http: iu'bililG'lS w.u'rldbank.org/sar/sa.nsf ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 53 he Multilateral Invest- The approved policies and procedures ment Guarantee Agency are available on MIGA's website (MIGA) was established (www.miga.org). i *. -6 w 4- d -<, ,$ .-, *, ) +-as a member of the World Bank Group in 1988 to The environmental assessment policy address shortcomings in the investment formalizes an approach to environmen- insurance (guarantee) industry and pro- tal review that has been taken by MIGA vide a risk-mitigation service that was for many years. The disclosure policy not readily available elsewhere. MIGA now encompasses the required disclo- sure by MIGA of environmental infor- K @ was authorized to establish (a) an invest- ment insurance (guarantee) program, mation for projects considered environ- ment isuranc (guarantee)ocialv program,Cat which provides political risk coverage mentally and socially sensitive (Cat- L to foreign investors from anv of itsmem- egory A projects). During fiscal 2000, ber countries; and (b) a . MIGA's Board approved guarantees for > . .- -. , ~~ber countries; and (b) a technical assis- technical as . 'three Categorv A projects (in mining and M.I.G.4 , tance program, which assists developing _ M | * t l~~~~~~~~~~~~nfrastructure) that were subject to M.I.G.A. . . 1@ -member countries in attracting foreign MIGA's new disclosure policy direct investment. MIGA neither invests +, - -: -~ ;\, nor lends monev to investors, nor does *7 ,'''In fiscal 2000, MIGA issued contracts of it propose or design projects. Like any g guarantees for 10 investments in the fi- other form of insurance, inves- nancial sector and for 24 projects in other tors and lenders who want this (nonfinancial) sectors. Several of these coverage pay premiums. projects are directly associated with re- newable energy, clean energy, and en- It is MIGA's policy that all ergy efficiency. These included two the investments it facilitates geothermal power projects (Kenya and through its guarantee program Nicaragua); four projects that increased are carried out in an environ- energy reliability and efficiency by pro- mentally and socially respon- viding transmission line interconnectors sible manner. MIGA has been (Brazil, Mozambique, and Peru); and one applying World Bank environ- project for a new natural gas pipeline * mental policies and guidelines (delivering natural gas to industrial fa- to MIGA projects, often with the cilities in the vicinity of Vitoria, Brazil). * environmental counsel and ad- vice of the IFC. In fiscal 1998 Significant environmental improve- MIGA began drafting its own ments are expected to be achieved l lgi specific policies that reflect its through two other projects that MIGA W business as an insurer of for- guaranteed in fiscal 2000. In a project in 2 5 ;rtyAidtt: eign investments. These draft Zambia, slag waste from a copper ^ - environmental assessment and smelter that has been operating since the i_i-:--disclosure policies, and the 1930s will be reprocessed for cobalt, and l - procedures for implementing redeposited in properly engineered and them, were the subject of exten- operated disposal facilities after cobalt them, were the subject of exten- extraction. In a project in Macedonia, a sive discussions in fiscal 1999 MIGA-insured investment in an existing , I | w ~~~~~bv MIGA's Board and manage- by M_GA's Board and manage- cement plant will lead to discontinued " s t w ~~~~~~ment. In May 1999, the Board approved MGays ten ronmn production of asbestos-cement products. j :_ \ \ ~~~~~~approved MIGA's environmen- tal assessment and disclosure Tlhis ar-ticle waRas prcpared by Harvey D. Van j policies and procedures, which Veldhuzeit of the Multilateral hioest took Gu- w FS* i(;laranGtceAecut'S Cc'. . of Gnaral7teeŽ, (202) took effect with all new appli- 473-3390 fax (202) 522-2o30. Web.isite Windmill, Kenya. cations received in fiscal 2000. a'zi'wmniia.or< 54 ENVIRONNFENT MArTERS * 20()0 World Bal-k I stitu- WORLD Environment ane !N atur.i A BANK Resources Di'v - i NTTTon w-w-= heWorldBankInstitute's lights of the program in the Latin Environment program, this composite =1 4 | Environment and Natu- America and Caribbean Region included program held in February-March 2000 ral Resources Division city-specific workshops in Rio de Janeiro addressed increased and improved (WBIEN) works to facili- and Buenos Aires, which led to the on- press coverage of sustainable develop- tate a learning dialogue going preparation of city action plans for ment issues in the water sector in Africa. and disseminate innovative approaches urban air quality management. The activity included (a) a workshop- to sustainable development, primarily "Making Water Everybody's Business' among policymakers and opinion lead- Environmental Economicsfor Development -attended by 32 journalists from nine ers. WBIEN staff include specialists in Policy. In July 1999, the annual core African countries; (b) an electronic dis- economic, institutional social, environ- course on Environmental Economics for cussion among participants immedi- mental, rural development, and other re- Development Policy was held for the ately following the workshop; and (c) lated fields. In fiscal 2000, WBIEN second time. It attracted 49 partici- participation in the Second World Wa- worked with different types of partners pants-senior policymakers, academics, ter Forum in The Hague. On average, and audiences to address questions NGOs, and private-sector representa- each journalist has published or aired at about sustainable development and glo- tives-from 33 countries. Designed to least 10 water stories since the work- balization, including the following: address the challenge of mainstreaming shops, totaling more than 250 stories. the environment in the policymaking Integrating Environment Into Poverty Re- process, the course highlighted current Regional Cooperationfor Strengthening En- duction Strategies. WBIEN staff contrib- economic thinking and practice in ad- vironmental Compliance and Enforcement in uted to the environment chapter of dressing resource and environmental Asia. In response to client and partner the Poverty Reduction Strategy Papers problems at the macro, sector, and requests and in line with WBI's exten- Sourcebook. This chapter offers guidance project levels. sive efforts to address governance is- on (a) integrating environmental consid- . . . sues, this meeting in Bangkok in June erations into policy dialogues and strat- WBI En.Ironmental Training Course in 2000 launched WBIEN's new program on egy formulation; (b) considering the Chn InSOctobe 19 i nShenzhen, Environmental Compliance and Enforce- effects of environmental interventions on China, ESSD Vice President Ian Johnson ment. The program aims to strengthen povrty an (c evluaingtheeffctie-delivered a public seminar entitled "De- national capacity for environmental com- Povert afn (c) eiau ating the effective- velopment Framework for the 21st Cen- pliance and enforcement and identify nes o inerenton acos setos sch tury: The World Bank and China's aprchsfrro tigeinlc- as forestry, water and sanitation, and Environment" to about 150 participants approaches for promoting regional co- health. on the closing day of the two-week core operahon m this field course on Environmental Economics and Scaling Up the Clean Air Initiative. WBI has Policy (EEP). The course was cospon- been working with partners within and sored by WBI and State EPA of China outside the Bank since 1998 on urban air (SEPA), and exposed participants to the quality management in Latin America, technical and analytical tools that under- Africa, and Asia. WBI is committed to line decisionmaking in the arena of en- such a program and to playing a lead- vironment and development policies. ing role in facilitating the coordination This article was prepared by Alexandra Klopfer, (202) 473-4645 of the World Bank Institute, of all nonlending activities related to Making Water Everybody's Business. Build- fax (202) 676-0977. urban air quality management. High- ing on WBIEN's Media and the Global Website-http://www.worldbank.org/wbi ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 55 \ vo- r -; "C - i vv 4 ince the 1992 UN Confer- GEFs focal areas key role in the WBG's GEF bio- S e ence on Environment GEF assistance covers four focal areas: diversity program. These include and Development, the biodiversity, climate change, interna- environmental trust funds (Bhutan, Global Environment Fa- tional waters, and the ozone laver. The Bolivia, Colombia, Mexico, Papua cility (GEF) has emerged Bank's GEF portfolio is dominated bv New Guinea, Peru, South Africa, and as a facilitator and a funding mechanism projects focused on biodiversity and cli- Uganda), creating markets for eco- for integrating global concerns into the mate change, which together account for system services, and developing development process. After a three-year more than 75 percent of the WBG-GEF innovative ways for financial pilot phase, the GEF was restructured in grants. 1994 to provide for universal member- * Addressing Climatc Change. The A fast growing segment of the ship, greater transparency and participa- Bank's portfolio of GEF climate portfolio covers the management of tion in its affairs, and to serve as financing change projects now stands at 44 biodiversity outside protected areas mechanism for the global conventions on projects at a total cost of $4.6 billion, through habitat protection and biodiversity and climate change. To- including GEF financing of $453 restoration, eradication of alien gether with the UNDP and UNEP, the million and funding from the Bank species, and biodiversity conser- World Bank Group (WE3G) has served as of $1.02 billion, as well as from vation through improved manage- privateopartnersrandlgovernmentdment and sustainable use of natural an implementing agencv for the GEF. counterparts of about $3.1 billion, resources in the production land- The majoritv of projects aim at scape. 1n total, B ancagement has approved removing barriers to energ efficient Protectinig the Ozonle Layer. Since 1991, 180~ ~ ~ ~~~~~~~~~rmvn barriersce toit enrg effiien 70 countries 'fora totalto $. abion in technologies and energy conser- the WBG has committed $125 countries for a total of $1.23 billion i vation measures and at removing million in GEF funding to help GEF funding, with cofinancing of $1.39 barriers and reducing the imple- enterprises in the transition econo- billion in IBRD/IDA funding and $4.1 mentation costs of renewable energy mies of Central and Eastern Europe billion from other sources. The WBG- technologies. During fiscal 2000, the and the former Soviet Union convert GEF portfolio includes 125 full projects, GEF Council approved the Energy to ozone-friendly technologies. 35 medium-sized projects, and 20 En- for Rural Transformation Project in These endeavors should lead to the abling Activities. Uganda, which is the first project elimination of more than 80 percent under the GEF-WBG Strategic of the overall CFC production in In fiscal 2000, the Bank's GEF program Partnership for Renewable Energy. developing countries and countries reached a new all-time high of $280 mil- * Coniserzation and Suistaiinable Use of in transition. With the expected lion in GEF grants approved by the GEF Biodiiversity. The Bank's portfolio of completion over the next few years Council, representing a 12 percent in- GEF biodiversity projects now of national ozone-depleting sub- crease over the previous year. In 37 stands at 107 projects at a total cost stances phaseout programs for these projects, these funds complemented of $1.44 billion, including GEF countries, the WBG-GEF ODS Bank lending and other cofinancing re- financing of $480 million and program will come to an end. sources, primarily in the areas of conser- funding from the Bank ($301 U Fresh antd Marine ]' . Resolurces vation and sustainable use of bio- million), as well as from private Managemnent. The Bank's portfolio of diversity and the promotion of energy partners and government counter- GEF international waters projects efficiency and renewable energy devel- parts of about $657 million. The now stands at 15 projects at a total opment. Thev included 17 "medium- greater part of the portfolio cost of $363 million, including GEF sized" projects, each of $1 million or less supports the establishment of new financing of $146 million and in GEF grant financing, which are de- protected areas and the strengthen- funding from the Bank ($68 million), signed to build partnerships with NGOs ing of management at existing areas. as well as from private partners and and support flexible and innovative ap- Mechanisms for financing bio- government counterparts of about proaches to the adoption of globally sus- diversity conservation (and thereby $148 million. The Bank has worked tainable resource management practices. increasing its sustainability) play a with the GEF and other partners to 56 ENVIRONMENT MATTERS * 2000 actively support development and sistance for environmental management Looking ahead implementation of regional conven- of the lake and its ecosystem. Several lessons and associated challenges tions for the management of will influence the further growth and international river basins, shared A S26 million GEF grant directly financed mainstreaming of the GEF in overall WBC lakes, regional seas, and shared 41 megawatts of wind turbine installa- development assistance programs: groundwater aquifers. During fiscal tions and strengthened the capabilities 2000, the WBG presented to the GEF of the India Renewable Energy Develop- First, the WBG will need to strengthen Council a proposal for a Strategic ment Agency to promote and finance its capacity to link GEF funding and lo- Partnership for Nutrient Reduction private-sector investments; more than cal development priorities. The global in the Black Sea/Danube Basins. . environment and the GEF are still fre- 270 megawatts of wind projects were fi- The funds under this umbrella quently looked upon as a separate and investment program would include nanced through this agency. externally driven agenda. This calls for $70 million in GEF grant financing a program to strengthen and accelerate and would leverage significant Mobilizioigt[lePrivateSector. TheWBGhas in-house and client training. national and international invest- played a major role, through the involve- ments to address the serious eutro- ment of the IFC, in seeking to redirect Second, the WBG will explore modali- phication problem in that area. and mobilize private capital, expertise, ties for linking GEF funding more pro- and privately held technology to more grammatically to the WBG's country The WBG is responding to land degra- effectively serve the objectives of the assistance dialogue and lending pro- dation and desertification through a GEF. For example, gram. GEF projects need to be placed in large lending program ($1.8 billion in the the broader sectoral development con- past decade). GEF funding helps ensure U The IFC has joined with several other text and its related environmental man- that the design and implementation of private and public sector groups to tegic Partnerships on Renewable Energy these projects contribute to conserving invest in the Renewable Energy and Technology Development and Nutrient biodiversity, securing carbon sinks, and Energy Efficiency Fund, the first Reduction illustrate the wav forward. reducing carbon emissions. global private equity fund devoted exclusively to investments in renew- Third, the WBG will seek to expand part- GEF's leverage able energy and energy efficiency nerships in order to live up to its own The WBG's GEF financial commitments projects. The fund will also have expectations and those of others regard- are small relative to the size of global access to a unique co-financing ing its role in transferring concessional environmental problems. However, the arrangement with up to $30 million funding to client countries for global Bank can leverage action for global en- in concessional funds from the GEF environmental objectives. A high prior- vironmental management by mobilizing * The Solar Development Group ity is the development of arrangements trans- (SDG)P a for multilateral (especially the regional resources, promoting technology trans- (SDG), the result of a joint initiative dopment ilateral do- fers, and fostering and strengthening between the World Bank, IFC, CEF development banks) and bilateral do- partneships nors to assume responsibility for devel- partnerships. and a number of charitable foun- oping and implementing GEF projects. dations, has been established to For every $1 of Bank-GEF assistance pro- further stimulate development of a Finally, recognizing that the greatest po- vided, there is an associated $1 of IBRD/ viable market for solar home tential for action on global environmen- IDA resources as well as $2 of co- systems using solar photovoltaic tal issues is in the private sector (from funding from other donors, foundations, ehooyi ua ein fte croain ocmuite) h B and the private sector. In the Lake tehnology in rural regions of the willaccelerate its efforts to engage the Victoria Environment Program in Africa, target capitali-zation of $50 million, private sector more effectively. This will for example, the prospect of additional targetinclude creative mechanisms for fund- GEF support led the three riparian coun- of which more than $25 million has ing Conservation and sustainable use tries to agree in 1994 on a priority action been committed from the World and conservation of biodiversity, as well plan to reverse serious ongoing environ- Bank, the IFC, the GEF, and as supporting other ecosystem services, mental degradation. The $35 million foundations. including carbon management. GEF grant was instrumental in mobiliz- U IFC's Photovoltaic Market Trans- ing matching funds from IDA to help fi- formation Initiative (PVMTI) is nance priority investments addressing leveraging $30 million in GEE funds Eiiooiiieit Departtieat's Global Enoi7ronoir t pollution "hotspots." Other bilateral to finance private sector PV market Facility Team, (202) 458-2685,fax (202) 522- donors followed by expanding their as- development projects. 3256. Website-t qi, ., . . rg. ANNUAL REVIEW * JULY 1994-JUNE 2000 (FY2000) 57 The Bank will act as the broker in help- ing to negotiate a reasonable price for both buyers and sellers of emissions re- P ro tot e ductions. In this way, developing coun- .y e tries will benefit by acquiring cleaner technologies and making them more profitable than their fossil fuel alterna- a r o n tives. Industrialized country investors will gain by paying a lower price for emissions reductions than are available in the context of their own companies or Fun _ [countries. Experience from the current pipeline of PCF projects and the Bank's largely GEF- ne of the difficult chal- * Article 12 provides for similar financed climate change mitigation lenges facing the global project-based carbon offset trading projects suggests there are many oppor- I community is how to between industrialized and tunities to reduce emissions of green- cost-effectively reduce developing countries under the so- house gases in developing countries at carbon emissions to avert called Clean Development Mech- a cost of between S5 and $15 per ton of the worst impacts of climate change. anism (CDM). The purpose is to carbon. This compares with a marginal Under the Kyoto Protocol, which guides assist developing countries with abatement cost that rises quickly to $50 implementation of the Framework Con- sustainable development through per ton of carbon in advanced econo- vention on Climate Change, industrial- the transfer of cleaner technology mies, and already exceeds this level in ized countries must reduce their carbon and financial resources for specific the most energy-efficient economies. It emissions to at least 5.2 percent below projects, while at the same time is the difference in cost to industrialized their 1990 levels by the end of 2012. contributing to the objectives of the and developing countries that provides Convention by lowering carbon the opportunity for mutually beneficial To meet these commitments in the most emissions. trading relationships. cost-effective manner, the Protocol con- tains provisions allowing industrialized The World Bank's Prototype Carbon Investors in the PCF have expressed a countries some flexibility to meet their Fund (PCF) is an attempt to understand willingness to pay on the order of $20 emissions reductions obligations though the process and procedures for creating per ton of carbon (equivalent to about trade with developing countries and a market in project-based emissions re- $5 per ton of carbon dioxide) as an out- toprovisions ductions under the provisions for Joint comes price averaged across the portfo- transirtionconarlyimpomie : TImplementation and the Clean Develop- lio. Hence, room appears to exist to are particularly important: ment Mechanism. The PCF was estab- enable the PCF to negotiate a price that lished with investments from govern- covers risks to investors while provid- * Article 6 allows for the joint ments and private companies, and is ing adequate profit incentives for PCF implementation" of projects by advised by representatives of develop- investments to project sponsors in host industrialized countries, including ing and transition economies, NGOs, and countries. those with economies in transition. others. It will invest in cleaner technolo- Under this provision, Country X gies in developing countries aimed at Progress to date invests in a project that will reduce promoting sustainable development and greenhouse gas emissions or reducing greenhouse gas emissions. On April 10, 2000, the Prototype Carbon improve their absorption in Country These emissions reductions will be in- Fund (PCF) achieved its first closing and Y. In return for its investment, dependently verified and certified, and formally began investment operations. Country X would acquire the then transferred back to the Fund's in- Demand for the PCF has been so high resulting emissions reductions, vestors in the form of emissions reduc- that a second closing was made available which it could use itself or sell. tion certificates rather than cash. for investors who wished to havc more 58 ENVIRONMENT MATTERS * 2000 time to complete their decisionmaking on PCF subscription. A second closing will be achieved at the end of Septem- ber 2000. The PCF has already completed nego- - tiations for an emissions reduction pur- *6 . r 4 chase agreement with the Government _ __ - of Latvia. Under the Solid Waste Matnage- merit Project in Liepaja, PCF resources will support an advanced form of municipal waste disposal to replace the open dumps now in use. Some 90 percent of the waste will be recycled and the meth- - _ _ _ ane emitted by the waste will be used to generate electricity. If the minimum emissions reductions anticipated in this project are achieved, the price outcome will be about $23 per ton of carbon. The Fund's capital is to be in 20 or so projects by June 2003. To meet this in- vestment rate, at least two-thirds of the S projects need to be firmly identified by mid-2001. Lessons learned The PCF's experience extends beyond - the Latvia project into the eight-plus in- Tcop pluoto Tiaffc congesioarn Gtiana Bonorn photo Liteslock grazmng near faclor) vestments under preparation. The most Estonia important lessons are: U Need7 for Streaml1in1ed Procedulres for Smalnil Projects. PCF procedures are * Need to Reduce Transaction Costs. the need for new intergovernmental cost-effective for medium to large Through its parallel applied institutions. Oversight by the Parties projects, but are likely to be researcharmanditsownoperations, is essential to ensure that good prohibitively costly for projects less the PCF is exploring a number of practice is identified and sys- than about $10 million in total approaches to reducing transaction tematically applied. Likewise, financing, or about $2 million in costs and increasing certainty for severe penalties are required to carbon financing. Yet for the investors in small-scale emissions ensure adequate incentives for majority of developing countries, reductions activities. compliance. projects of this size and less dominate their opportunity to * Using Private Sector Capacity to Mcet Information about how the PCF works participate in the CDM. If the CDM Private Investors Needs. In the fields is available to the public through the design is to include most deve- of baseline determination, valida- PCF website (www.prototypecarbon loping countries, UNFCCC nego- tion, verification, and certification, fund.org) tiators need to take this perspective private sector entities and associ- into account when finalizing the ations can supply experience and This article zwas prepared by Kenniethf Ncwzconibe af the Environmient Depar-tmenzt's rules of the game in The Hague in capacity to support the Kyoto Prototype Cairboni Funtid, (202) 473-6010,fax November 2000. Protocol's implementation without (202) 522-2130. ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 59 > Updaesp te s U CEPF A new $150 million Critical Ecosystem Partnership Fund (CEPF) was launched in August 2000 to better safeguard the world's most endangered biodiversity "hotspots," where some 60 per- Bank Announces cent of all terrestrial species are found on only 1.4 percent of the Earth's land surface. The hotspots in South East Asia as shown in the map at left. New Ecosystem The fund is a partnership between the Bank, the Global Environment Facility (GEF), and Con- Protection Fund servation International (Cl). Each of the founding partners will contribute $5 million annually for five years. Additional supporters are being sought to achieve the CEPF target of $150 mil- lion over the next five years. "We have to move fast to create realistic alternatives for poor people if we are to relieve the growing pressures on the environment," said World Bank President James D. Wolfensohn. "The Fund will help us find solutions that allow poor people to have a better way of life while at the same time conserving the biodiversity on which their long-term survival depends." Cl will oversee day-to-day management of the fund. To reach the people with the greatest stake in ensuring protection and the greatest ability to make it happen, the CEPF will work through community groups and nongovernmental organizations on the ground. "This is a new source of money exclusively for local groups whose work is central to protecting the biodiversity hotspots," said Peter A. Seligmann, Cl Chairman and CEO. "The aim is to help agencies and communities to pull together more effectively and have a greater impact. Too often the many ongoing efforts in the hotspots fail to deliver because people don't know what others are doing or because critical activities-often at the grassroots level-are not funded." Investments will support training, transnational planning, local dialogue with extractive indus- tries, conflict resolution, priority setting and consensus building, strengthening indigenous or- ganizations, and facilitation of partnerships between the private sector and protected areas. During the first year of operation, the Fund's focus will be on the hotspot regions of Madagas- car, West Africa, and the Tropical Andes. Each subsequent year, the Fund will invest in a minimum of five additional critical ecosystems. The Integrated Land and Water Management Initiative (ILWMI)-a joint effort of the Global U ILVWMI Environment Facility, United Nations Development Program, United Nations Environment Pro- gram, and the Bank-was prompted by the urgent need to develop a holistic and integrated Draft Action Plan approach to reverse land and water degradation in Africa. Regional coordination is particularly for Land/Water critical in Africa, where land and water ecosystems frequently do not match the continent's political boundaries. Initiative in Africa ILWMI's draft Action Program has three main elements: (1) establishing and collecting good practice and lessons learned; (2) building capacity for greater river basin cooperation and knowl- jl edge exchange; and (3) supporting high-level policy dialogue within Africa on integrated land _ and water management practices and policy instruments. At its first expanded meeting in Nairobi in May 2000, representatives endorsed the draft Action Program as a working document and strongly recommended that the process henceforth be a- African-led in participation and interventions. It was also agreed that the Action Program should aim at consolidating and building upon existing priority programs and should be a building _ block for the implementation of the UN Convention to Combat Desertification (UNCCD). 60 ENVIRONMENT MATTERS * 2000 * POPs The United Nations Environment Programme and other international insti- tutions have been working since February 1997 to prepare a legally bind- Persistent Organic Pollutants ing convention for international action to minimize releases of persistent organic pollutants (POPs). These chemicals are long-lived, can accumu- Add ed to Glob3al Agend a late in organisms, and can build up to high levels in the environment and the food chain. The forum for this effort is an intergovernmental negotiating committee (INC) convened by UNEP's Governing Council. The committee is initially considering 12 specific POPs, including some pesticides, certain industrial chemicals, and unintended byproducts, including dioxins and furans. Delegates from over 100 countries have been attending the negotiations - and are generally optimistic that the remaining issues will be resolved at the next negotiating session in December 2000 in Johannesburg. - 511The Bank has been followingthe negotiations closely and is initiatingwork, supported by the Government of Canada and others, to provide develop- ing countries with capacity building assistance to address this issue. For more information, contact Steve Gorman at the World Bank (202) 473-5865 or Jim Willis at UNEP (jWillis@unep.ch). ESSD's Social Development Department coordinated the Bank's participation at a special ses- sion of the United Nations General Assembly in Geneva in June 2000, where more than 6,000 kA( people gathered to mark the fifth anniversary of the historic 1995 United Nations World Sum- @ UN Marks 5 mit for Social Development held in Copenhagen. Anniversary of The final Summit document reaffirmed the goals of Copenhagen and went beyond the Copenhagen commitments. The commitments now include: Summit * Halving the number of those living in extreme poverty by the year 2015 (relative to 1990). * Reducing HIV/AIDS infection levels in young people by 25 percent in the 25 African countries most affected by the disease by 2005. EW F * Achieving a 50 percent increase in adult literacy by 2015 TO SOC IAL DEVELQPM B S • Closing the gender gap in primary and secondary education by 2005. * Supporting the Cologne initiative for the reduction of debt, particularly the speedy imple- mentation of the enhanced Highly Indebted Poor Countries Initiative. The Bank sponsored or participated in 26 panels. There was a high demand for the Bank's Summit flagship publication, New Paths to Social Development: Community and Global Net- works in Action. This focuses on "social capital"-the concept that social relationships and networks are a form of capital that can benefit their members and influence the use of other assets. Increasingly, the study suggests, governments and international organizations such as the World Bank must cooperate with both community and global networks to achieve sustain- able social progress. For more information, visit the World Bank's Social Summit website: http://www.worldbank.org/ socialsummit. ANNUAL REVIEW * JULY 1999-JUNE 2000 (FY2000) 61 ; - . t . * ,\%7BANXVF The Global Alliance for Forest Conservation and Sustainable Use, a partnership between the World Bank and the Worldwide Fund for Nature (WWF), is continuing to work toward its goals Forest Alliance of creating new protected forest areas, improving management capacity at existing but threat- ened protected forests, and expanding the area of production forests under independently cer- Promotes Forest tified sustainable management. Conservation and In November 1999, the Alliance brought together more than 80 of the world's leading experts and stakeholders involved in forest management, production, and trade to share their experi- Best Practices ences with certification and verification systems. r________________________________________________ In addition, the Alliance has continued to promote more efficient use and increased productivity of forest resources, so that by 2050 rmost of the world's needs for industrial forest products could be derived from a comparatively small proportion of intensively man- aged global forests. This Global Vision-a joint project with the US Council on Foreign Affairs, the World Resources Institute, and the j g --<: ~ . :: - Rockefeller University-will lay out the basis for realizing a future where the health of global forests will be recovering and total glo- bal forest area will be larger than it is today. A recent World Bank report-Greening Industry: New Ro/es for Communities, Markets and U DECRG Governments-describes innovative approaches to pollution regulation in developing coun- tries. New Bank Report Greening Industry shows how economic and regulatory policy reforms are reducing industrial on Greening Industry pollution in developing countries without threatening economic growth. After many failed attempts to import regulatory models from the industrial countries, pioneers are developing a new model for pollution control. Based on sound economic principles, it incorporates market- based incentives, a broad commitment to public environmental information, and targeted assis- ii tance to managers who are trying to improve environmental performance. The new model stresses participatory regulation, with community representatives taking their place at the nego- tiating table along with government regulators and factory managers. The report includes a CD-ROM, which provides a large set of reference materials, databases, and audio-visual presentations. An Internet version of Greening Industry is featured on the - Greening DECRG Website, "New Ideas in Pollution Regulation" (http://www.worldbank.org/nipr). The Mrl iry report can be ordered from the World Bank online (http://www.worldbank.org/htnl/extpb/ N-Rt.1, I., howtoorder.htm). .- * Second World Government leaders and a wide range of interested partners gathered at The Hague in March 2000 for the Second World Water Forum to discuss all aspects of water resources management. Water Forum The Forum featured a ministerial conference and a world water fair and technology exhibit. One of the highlights of the meeting was the report of the World Commission on Water for the 21" Century, which was formed to call public attention to the global water crisis and to find solutions. Speaking at the Forum, World Bank PresidentJames Wolfensohn emphasized the magnitude of the challenge facing the world. By 2025, he noted, the world will need 40 percent more water for cities and 20 percent more for food. Yet, he added, in many areas the environment already is overstressed. The Forum generated wide interest and considerable debate. The Bank is following the out- comes of the Forum and continuing its dialogue with many of the participants. 62 ENVIRONMENT MATTERS * 2000 Discussions on "greening" of procurement processes have taken place between environment * Green Procurement and procurement specialists from the World Bank, the Asian Development Bank, and other international financial institutions, as well as the Consumer Choice Council. Matters being addressed include review of public and private good practice in this area, promotion of eco- labeling and green certification systems, expansion of the use of graylists and blacklists of hazardous products, and promotion of green procurement through strengthening of guidelines and standard bidding documents. More discussions are planned for November 2000. * OED In parallel with the development of a World Bank Group environment strategy, the Bank's Operations Evaluation Department (OED) is preparing an evaluation of the Bank's performance Operations in the promotion of environmental sustainability. Evaluation A number of thematic areas were selected by OED for in-depth evaluation based on their potential value for the formulation of the Bank's environment strategy, including: Department * Compliance, ownership, and sustainability of environmental safeguards. The review wi ll Environmental address systemic weaknesses associated with compliance. Review Under Way . The poverty-environment nexus. The review will attempt to identify and evaluate the factors associated with success in this area and assess the potential for replication and scaling up. * Environmental impact of SALs/SECALs. Understanding the environmental impacts of ad- justment programs has improved con- siderably over the years, yet implementation varies across coun- tries. The review will assess efforts to integrate environmental issues into structural adjustment loans and Coun- try Assistance Strategies. n Global issues. The OED review will focus on two issues that will be of critical importance during the next decade-desertification and biodi- versity. The Interim Report of OED's Environ- mental Evaluation was presented to a subcommittee of the Bank's Board in July 2000. The final report is planned to be completed in the first quarter of 2001. *Cloud Forest Alive With support from the World Bank, the Tropical Science Center of Costa Rica in April 2000 began the world's first live internet site based in the tropical forests of Central America. Through the Cloud Forest Alive (Bosque Nuboso Vivo) website, internet users around the globe can interact with local forest guides and researchers in the Monteverde Cloud Forest Reserve and MI ~~~~~~gain an appreciation of the important roles that tropical ecosystems play at local, regional, and global levels. For more information, please visit www.cloudforestalive.org, www.bosquenuboso.org, and www.quetzalcam.org. ANNUAL REVIEW - JULY 1999 JUNE 2000 (FY2000) 63 P u b I I c a t I on s A Selection of World Bank Group Environmental Publications The following publications may be obtained by sending an email message to eadvisor@worldbank.org, or by phoning the ESSD Advisory Service at (202) 522-3773. General Cinco Aiios Despues De Rio - Innovaciones en las Tlohward an Environment Strategy for the Tfbrld Bank Group Environment Department Paper No. 73 -I Progress Rep ort and Discussion DraftEvrnet eatin PprN.7 . A Progress Report and Discussion Draft John Dixon, Decemiiber 1999 (translation bv the Nlinistry of F}rivironlment Departmcnt Environment Department ~~~~ ~~P1I _ San Jose, Costa Rica) Nlagda Lovei, ed., April 2000 E'nironimental Peribrmance Indicators - .i Second Climate Change Edition XAote lle.-ing the Link betiveen Transport and Greenhouse Gas Environment Department Paper No. 71 lemissions -t Path fbr the afnporldank Lisa Segnestam, October 1999 Lee Schi7pper, Celine Marie-Lilliu, and Roger Gorham Natural Resource Management Interniatlonal Energy Agenc, Paris jtune 2000 Good Practices in Drylands - l.,ngni,ucit Ragnar Ovgard, Trond Vedeld, and Jens Aune C'ome Hell or High TWiter - Integrating Climate Change October 1999 l dlnerabilitv and Adaptation into Bank If brk Envirotmient Departmenit Paper No. 72 Drylands. Povert- and Development - Proceedings of the Ian Burton and Nl\aarten van Aalst, October 1999 June 15 and 16. 1999 Ilbrld Bank Round Table Enos E. Esikuri, ed., November 1999 Environmental Assessment Pollution Management Social and Environmental Assessment to Promote Sustainabiltv - An Infirmal View from the 1burd Blank Decision Support System for Integrated Pollution Control - Einvironment Department Paper No. 74 Solhvare fbr Education and Ana4esis in Pollution Management Robert UJ '1 ii, IllJ anuary 7000 lona Sebastian, Kseniya Lvovsky, Henk de Koning December 1999 EnvIronmental Economics Environmental Economics In Focus - Pollution Nlanagement I)iscussion Notes * burism and the Environment in the Caribbean - An Eco- #6 EnTironment Funds: The Chinese Experienlce nomic kramevork #7 Environnmenital ( II, I I.- . of Fuel Use Latin America and the Caribbean Region Report No. 20453 #8 Comparative Risk Assessment in Developinig Countries In collaboration with the European Commission, #9 Foreign Direct Inivestment Boon or Bane for the Johni Dixon, Kirk Hamiltoni, Stefano Pagiola, and Lisa Enviroinment Se-nestam Environment Department June 2000 Magda Lovei, ed., dating from Novenmber 1999 to June 2000 Deforestation and Land C Te Changes Induced by the East Asia Developing a Culture of 'Industrial Environmental Compliance Economic Crisis - A Vew Approach East Asia Environnment and Social Development Sector Unit Environment Department Paper No. 70 Steftno Pagiola, April 2000 Mlichelle L. Keene, September 1999 64 ENVIRONMENT -MATTERS * 2000 Rural Development Principoles and Good Practice in Social Policy: Issues and Areas Rural Development, NVatural Resources and the Environment for PUblic Action - Lessons of Experience in Eastern Europe and Central Asia Prepared for the WVorld Bank/IMF Development Committee, L. Alexander Norsworthy, ed., Mlarch 2000 April 1999 (available in English, French and Spanish) Groundwater in Rural Development - Facing the Challengdes Consuiltations with Civil Society Organizations - General of Supply and Resource Sustainabilty Guidelines lor Wlrld Bank Staff World Bank Technical Paper No. 463 NGO and Civill Society UTnit, 2000 Stephen Fostcr anid otliers, Marcli 2000 (ISBN 0-8213-4703-9) Violent Conflict and the Transformation of Social Capital - Lessons from Cai'nbodia, Rwanda, Gutatemala, and Somalia, Food Safety Issues in the Developing WVorld Nat J. Colletta and Michelle L. Cullen, Conflict Prevention World Bank Technical Paper No. 469 anid Post-Conflict Reconstruction Laurian Unnevehr and Nancy Hirschhorn, May 2000 May 2000 (ISBN 0-8213-4770-5) Culture and Sustainable Development - A Framewvork for Social Development Action Ne aths to Social Development: Community and GlobalSoilDvopetearmn,19 NVetwvorks in Action A contribution of the NVorld Bank to the United Nations Special Session of the General Assembly, June 2000 To be added to the Environment Matters mailing list, complete coupon and mail to address belowvl Name .,. , I TitleI I Office telephoneI Fax number I Organization I Address City/State/Postal Code____________________________________ I CountryI Email address I To order other Environment Department publications, refer to our publications list and write those you would like I I to receive below. To order more than 4, please contact the Environment Department publications office directly. I Title Series No. Author Date I ~ ~ ~ ~ -~~~ - ~~~~ - ~- -- - - -- - - - - ------- - - I - -~~~~~~ - - ~ ~ ~ ~ ~ ~ ~ ~ - - - - - - - - -~~~~~~~~~~- - - ~~~~~ - - - - -~~~~~ - - - ~~~ -. --- - -- - - I ~~Mail or fax to: Environment Department Publications Fax: 1202) 477-0565, phone (202) 473-3641I I ~~~~~The World BankI 1818 H Street, N.W., Room MC-5-126 I ~~~~~~Washington, D.C. 20433 U.S.A. L…-- - - - - - - - - - - - - - - - - - - - J Economic Reform Supporting the and Environmental Web of Life: The :- Performance in World Bank and sI Transition Economics 1 ; Biodiversity- by Gordon Hughes . I ,...+. A Portfolio Update F___ _ _ and Magda Lovei, (1988-1999) September 1999. b,, Gonzalo Castro, 5 a World Bank Technical Paper - - Nola Chow, No. 446. 61 pages. Kathy MacKinnon, (ISBN 0-8213-4564-8) , _ Nabiha Megateai, a $20 00 - - - eJ ~~~~Gunars Platais, and Tony Whitten, April 2000. 33 pages. -. The World Bank & The -. > Good Practices in Global Environment COOD PRACTICES IN Drylands Management 7:! . ., by a team from the DRVLANDS MANACEMENT by Ragnar 0ygard, Environment Department, Trond Vedeld, and led by Lars Vidaeus with Jens Aune, October 1999. w I.h.Y. L - Gonzalo Castro, staff v5 . 116 pages. A; -< <> *t g from Regional operating units, the Development Group, WBI, and IFC, . - lVay 2000. 60 pages. Case Study: Ningbo, Integrated Coastal China, Cultural Zone Management J! Heritage Conserva- of Coral Reefs - tion in Urban Decision Support Upgrading ------ Modeling O ' by Katrinka Ebbe by Kent Gustavson, and Donald Hankey, " Richard M. Huber, May 1999. -i and Jack Ruitenbeek, 50 pages. --: -- ;_^ eds., February 2000. 292 pages. (ISBN 0-8213-4628-8) $20.00. World Bank WWF Russian Views of the Alliance for Forest RssianViewof Transition in the Rural Conservation and d. Iw Sector - Structures, Sustainable Use: - Policy Outcomes, and Annual Report 1999. .-..: Adaptive Responses 36 pages. Visit the - by L. Alexander Alliance website at: N _ Norsworthy, ed., - -. - www-esd.worldbank. _-3 June 2000. 209 pages. 1r w (ISBN 0-8213-4765-9) $20.00. For information on how to obtain these publications, please call the World Bank Environmentt Department at (202) 473-3641, or write an email to eadvisor@worldbank.org.