NEWS RELEASE

World Bank Plan Protects Oil and Mining Industry, but not the Poor:
Canadian NGOs ask, “Where Does Canada Stand?”

June 21, 2004 – The Halifax Initiative Coalition says the World Bank hasn’t gone far enough in responding to an internal assessment of its oil and mining operations and calls on the Canadian Government to make public its position on the World Bank’s proposed plans.

Today the World Bank released a Management Response to its Extractive Industries Review (EIR). NGOs say this response fails to act on many of the recommendations contained in the EIR. Although the response is high in rhetoric, it avoids making firm commitments on key goals or targets.

“What we see in this response is a frustrating lack of political will on behalf of the World Bank to seriously address the review’s recommendations,” says Halifax Initiative Coordinator Michael Bassett. “On top of that, the Government of Canada has remained mostly silent on the review and its implications.”

The Extractive Industries Review (EIR), commissioned by President James Wolfensohn, assessed World Bank lending in the oil, mining and gas sectors and concluded that these projects are not currently delivering on the Bank’s mission of poverty alleviation and sustainable development. The report recommends a series of integrated and comprehensive reforms to improve conditions before extractive investments are made, and to ensure that local communities, especially the poor and most vulnerable, directly benefit from mining investments in their communities.

“Bank Management claims that they agree with 80% of the EIR’s recommendations,” said Graham Saul, International Program Coordinator for Friends of the Earth Canada. “But if you read their response carefully, you’ll notice that they only make commitments to address roughly 10% of the recommendations. They’re talking the talk, but they still won’t walk”.

The World Bank has set a 30 day public consultation period that NGOs have criticized as being too short given the nature of the Management Response.

“Management essentially took a comprehensive review that was World Bank led, World Bank designed, and World Bank driven, and ignored the key recommendations,” says Michael Bassett, Halifax Initiative Coalition Coordinator.

The EIR recommends – and the Halifax Initiative Coalition has called on the Government of Canada to support – that the World Bank get out of certain industries such as oil and coal and to ensure there are poverty alleviation results from other investments in mining.

The Halifax Initiative is a coalition of development, environment, labour, human rights and faith groups deeply concerned about the international financial system and its institutions.

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For further information please contact:

Michael Bassett
Coordinator
Halifax Initiative Coalition
613-789-4447
cell: 613-266-8100

Graham Saul
International Program Coordinator
Friends of the Earth Canada
613-241-0085, ext. 22
cell: 613-558-3368

Backgrounder

The Extractive Industries Review (EIR) was launched by the World Bank in 2000 to identify how and under what conditions, World Bank past investments in oil, gas and mining have contributed to poverty reduction. The EIR team, under the direction of Dr. Emil Salim, formerly the Minister of the Environment in Indonesia and former director of Indonesia’s largest coal company, studied and consulted widely for two years.

When the report came out in January 2004, it was very critical of the World Bank and contained four main sets of recommendations for the Bank:

• Assist in the creation of an enabling environment for pro-poor public and corporate governance prior to EI investments;
• Adopt and implement effective social and environmental policies;
• Adopt and implement policies to ensure greater respect for human rights;
• Re-set its institutional priorities so as to provide internal incentives for actions in support of the foregoing objectives.

On June 21, 2004 the World Bank released its response to the EIR. This response is essentially a plan for how to implement the recommendations of the review. This plan avoids taking the significant steps contained in the review that included phasing out investments in coal and oil and sequencing other mining projects to ensure poverty alleviation results.

The Halifax Initiative Coalition sees the review’s recommendations are mutually reinforcing. Failure to adopt recommendations in one area will undermine efforts in another.