by David Pred and Natalie Bugalski
There are big changes happening at the World Bank today, which will have far reaching consequences for millions of the world’s poor.
For the first time in over a decade, the Bank is undergoing a major review of its Safeguard Policies, which serve to ensure that Bank projects do no harm to people and the environment. While civil society groups are pushing to strengthen the policies and upwardly harmonize them with international human rights and environmental standards, the view that seems to prevail within the Bank’s senior management is that the World Bank needs to become a more attractive lender, with fewer strings attached to its loans, in order to “stay relevant” in the face of increasing competition from Brazil and China.
The World Bank, under President Jim Yong Kim, is trying to redefine itself for the 21st century. Mr. Kim has admirably reoriented the Bank’s strategy around its original poverty reduction mandate, setting two ambitious goals for the institution: the elimination of extreme poverty by 2030 and promotion of ‘shared prosperity’ to boost the incomes of the poorest 40 percent of the population.
Yet Mr. Kim often speaks about the need for the Bank to be less risk averse and support more “transformational large-scale projects” in order to achieve these ambitious goals. Many are starting to worry that this discourse is code for gutting the Bank’s social and environmental requirements, which are seen by some as inhibiting risk taking, while returning the Bank to the business of financing mega-projects. The irony is that the world’s poorest and most vulnerable communities – the very people the Bank has pledged to work for – are the ones who will bear the greatest risks if these concerns are realized.
One of the primary ways in which these risks materialize is in the form of development-induced forced displacement. As described by sociologist Michael Cernea, forced displacement remains a “major pathology” in Bank-sponsored development around the world. According the Bank’s Independent Evaluation Group, more than one million people are affected by forced displacement and involuntary resettlement from active Bank projects at any given point in time. Displacement is often accompanied by threats of and use of violence and results in loss of livelihoods and education, food insecurity, and psychological trauma.
Although the Bank has a resettlement policy aimed at avoiding these harms, local communities displaced in the name of “development” continue to face impoverishment and violations of their human rights due to Bank-financed projects. Revisions of the policy that harmonize it with international human rights standards, coupled with incentives for improved implementation could end put an end to this injustice.