5 November 2009
Guadalajara Civil Society Meetings in Guadalajara, Mexico open with increased demands for consultation process accountability, transparency guarantees. Good faith participation by CSOs rests on Bank decision to disclose and discuss a second draft of the proposed revisions to the Independent Consultation and Inspection Mechanism (ICIM).
Press Release
November 4, 2009
IDB Capital Increase Subjected to Consultation
- Civil society organizations demand that consultation mechanisms be transparent and participatory
- IDB Recapitalization should be conditioned upon reforms.
Guadalajara, México (November 4, 2009)- On Nov. 4 and 5, the Interamerican Development Bank (IDB) celebrates in Guadalajara a consultation with civil society to evaluate the Bank’s capital increase request. The Global Capital Increase (GCI) proposal for $US 180 billion is the ninth and by far the largest in IDB history –more than four times the volume of any prior GCI. Based on actual lending trends, the proposed GCI would triple the level of annual IDB lending to Latin America. This massive capital increase proposal follows an embarrassing loss of almost $1.9 billion in 2008.
The public consultation process that the IDB is carrying out in the context of the 9th General Capital Increase (GCI-9), and in a similar manner through a process to revise the Independent Consultation and Inspection Mechanism (ICIM), establishes without a doubt an important precedent in the IDB’s history. Civil society organizations recognize this effort as one that is based established methodologies that have been demanded by many of our organizations for some time and may not have existed without external pressure.
In this context, the consultation process runs the risk of losing credibility for different reasons. On one hand, the Bank has limited the timely dissemination of relevant, requested information to ensure informed participation. Also, the process lacks mechanisms to guarantee that the recommendations that emerge from the consultations are actually considered in the substantive institutional proposals, beyond their registration in meeting summaries. As such, the consultation and participation process loses its natural significance.
The legitimacy and credibility of the process depends on having access to the having access to the final proposal prior to its submission to the Governors of the Bank for approval. This principle of consultation applies in general to the GCI and all other policy reviews at the IDB (ICIM, Climate Change Strategy, as well as the New Institutional Strategy, etc.). This principle of prior verification effectively makes transparent whether the Bank has incorporated or not the comments received through the consultation in the final proposal. In other words, the consultation process should not serve only to provide external legitimacy for a closed process.
“Without greater commitments to transparency and accountability, the IDB’s institutional goal of results based management loses substance. With the firm expectation of achieving a process that results in genuine benefits and the increased legitimacy of the Bank’s good intentions, it is crucial to underscore certain inconsistencies in the IDB’s “Better Bank” rhetoric and the actual process of consultation that we are seeing.” says
Valeria Enríquez, of Fundar, Center for Analisis and Investigacion, of México.
The IDB is preparing the final version of the Independent Consultation and Inspection Mechanism (ICIM) for approval by its Board of Directors in November. The draft proposal for a revised ICIM policy supposedly reflects the proposals made by over 200 organizations and individuals, including acceptable grievance submission procedures for IDB financed project affected communities, apparently will not be disclosed by the Bank in spite of repeated requests by those consulted. Breaking with a common practice of other Multilateral Development Banks, this lack of commitment to share the final ICIM proposal lowers confidence in and quality of the GCI consultation process in general.
“The fact that these revisions to the ICIM policy have taken so long, as well as the decision to not disclose the second draft of the ICIM proposal, are disincentives for civil society organizations to participate in this or future consultations,” says Juan Carballo, Coordinator, Global Governance Program, CEDHA, of the Argentine NGO, CEDHA.
In spite of some advances in the incorporation of social-environmental sustainability considerations in its operations, the comparative advantage of the IDB as a “Green Bank” remains to be seen. Recent IDB initiatives, such as the Climate Change and Renewable Energy Initiative (SECCI), are at the margins of the Bank’s core business, while poorly planned investments in infrastructure and extractive industries have exacerbated the emissions of greenhouse gases that stem from unsustainable land use changes. The IDB does not measure nor reports its carbon footprint, nor the impact of its operations on biodiversity.
“Being a ‘green bank’ requires more than a list of projects. It requires a strategy to meet the challenge of climate change in Latin America, which explains what has been done, where we are, and where we are going. Not having this climate change strategy just weeks before the Copenhagen Conference raises doubt about the Bank’s capacity to lead on climate,” argues Cesar Gamboa, President of Derecho, Ambiente y Recursos Naturales (DAR) of Perú.
The meeting in Guadalajara is the second major discussion with civil society about the proposed replenishment following a consultation meeting convened in Washington D.C. on October 30th. The Bank’s Board of Governors’ will review a new draft institutional strategy and likely meet once more in Washington D.C. by February 2010 in preparation for the upcoming annual meeting scheduled for Cancún, Mexico in March of 2010. Replenishment proposals coming out of Cancún will then need to be approved by legislatures in each of the Bank’s donor countries. For the reasons mentioned, it is important that the consultative process be transparent, reflects and is accountable for the opinions received from civil society organizations. To avoid the loss of credibility in this process, the IDB should disclose drafts of all requested documents before they are submitted for final Board approval.
For the texts of the recent civil society observations and recommendations on the IDB, please see /es/Article.11519.aspx. For additional background information on the IDB and the 9th GCI, see /en/Institution.4.aspx.
CONTACTOS
Cesar Gamboa, President, Derecho, Ambiente, y Recursos Naturales (DAR), Perú, Tel. (511) 266-2063,
Valeria Enríquez, Researcher, Transparencia y Rendición de cuentas, Fundar, Centro de Análisis e Investigación, A.C., D.F., México (52-55)5554-3001 ext. 150,
Juan Martín Carballo, Coordinator, Global Governance Program, CEDHA - Centro de Derechos Humanos y Ambiente, Argentina, Tel. (202) 361 7039,