World Bank Meets With Environmentalists and Timber Industry In Wake of Internal Report Finding It Has Failed To Comply With Forest Policy

In the wake of an historic internal report that finds the World Bank has failed to comply with its forest protection policy, the international financial institution is meeting this week with environmentalists and the timber industry from North America.

Environmental and social justice organizations praise the candid nature of the report but disagree with the conclusions the World Bank appears to be drawing from it: that the fault lies with the conservation-minded forest policy itself and not with the lack of its implementation.

According to the report, the World Bank’s forest lending has not curbed deforestation or reduced poverty, despite a 78 percent increase in forest-related lending over the past 10 years. Furthermore, World Bank lending for other sectors, such as infrastructure development and economic policy reform, has failed to consider the impacts on forests. The report finds that some of these economic policies, as well as corruption, are the forces driving deforestation.

“Unfortunately, last year the majority of the World Bank’s own lending consisted of structural adjustment loans that promote some of the very economic policies the report finds accelerate deforestation in some countries, yet no environmental assessments are carried out for these types of investments,” said Korinna Horta, a senior economist at Environmental Defense.

“Closing the gap between the Bank’s policies and its practices will require changing its staff incentives,” said Horta. “Bank staff are currently rewarded for moving large amounts of money; they should be rewarded for protecting the environment and alleviating poverty.”

In view of the World Bank’s new lending for Russia’s Northern boreal forests, environmental groups are also asking the World Bank to extend the forest policy’s precautionary approach to these forests, which constitute nearly a quarter of the world’s forests and more than half of the world’s coniferous forests. The World Bank’s current forest policy was established before the collapse of the Soviet Union and hence does not address its Northern forest ecosystems.

“Russia’s enormous forests are critical for the region’s forest based peoples, for maintaining biodiversity, and for slowing the effects of global warming,” said Sasha Arbachakov, Director of the Siberian-based Agency for Research and Protection of the Taiga who is in Washington DC this week. “It is vital that the World Bank get its Northern boreal forest policies right the first time, and avoid the mistakes of the past.”

The World Bank’s forest policy review is available at: http://wbln0018.worldbank.org/oed/oedevent.nsf/htmlmedia/announcements.html