December 12, 2002

Mr. James Wolfensohn
President
The World Bank Group
1818 H Street, N.W.
Washington, DC 20433 U.S.A.

Dear Mr. Wolfensohn,

We are writing to express dismay at the recent Compliance Advisor/Ombudsman report on the MIGA guarantee of the Bulyanhulu gold mine and to request your urgent intervention.

The CAO is a mechanism that non-governmental organizations have pushed hard to establish. Your personal support for the initiative played a major role in ensuring that the CAO was established. As all parties have observed, the CAO's effectiveness rests on the respect and trust it enjoys amongst the public: integrity, transparency, even¬handedness and thoroughness are thus critical to all aspects of its work.

We are therefore gravely concerned at the poor quality of the Bulyanhulu report. Specifically, the report:

• fails to address the central question at the heart of the complaint: namely whether or not those evicted at Bulyanhulu has been fairly and justly treated, in accordance with World Bank guidelines;
• focuses on issues which were explicitly ruled by the CAO itself to be outside of the complaint and which the CAO further acknowledges to be beyond its ability to investigate;
• draws unwarranted conclusions on the basis of undocumented or contested evidence;
• maligns not only the complainants, but also international civil society.

This is gratuitous at best, egregious at worst.

Last, but not least, despite acknowledging that MIGA had failed to undertake due diligence, the report fails to draw conclusions from this or to make any recommendations with regard to MIGA's continuing investment guarantee for Bulyanhulu.

A detailed rebuttal and commentary on the report, amplifying these and other failures, prepared by the complainant is attached.

Mr. Wolfensohn, please be assured that, within the international NGO community, the report has severely dented the reputation of the CAO. Unless action is taken at the highest level to redress the manifest failures of the report, we believe it will take many years before confidence in the CAO's office is restored. This is not an outcome that we believe that you would wish to see.

We therefore seek your personal intervention to insist that:

• the eviction issues which the complainants sought to have investigated are fully investigated;
• all commentary on the issues outside the complaint are removed from the report;
• the institutional failures that lie behind MIGA's inadequate due diligence for the projeet are identified and measures proposed to correct them;
• the criticisms of MIGA's due diligence procedures are enacted upon, specifically through:
  • A) measures to identify and correct the institutional failures that permitted the project to
         be approved on the basis of inadequate due diligence; and
  • B) the suspension of all guarantees approved on the basis of that inadequate due diligence.

Sincerely,

CC:     Executive Directors, World Bank Group
Ms. Meg Taylor, Compliance Adviser/Ombudsman