29 May 2007
Civil society fears that Bank is cutting corners in safeguards review in rush to approve loans, posing potentially serious risks to affected communities and the environment.
The World Bank Board of Directors approved over $1.2 billion worth of projects for Africa in the past week, confirming fears that the Bank would attempt to push through billions of dollars in lending to the region before the end of the fiscal year on June 30.
As of mid-March, the Bank had approved only $1.8 billion of the “$5 billion or higher” promised for Africa this year by the outgoing president Paul Wolfowitz. With this latest round of approvals, that total has now reached $4.3 billion. Upon joining the Bank in 2005, Wolfowitz declared that Africa would be his top priority.
The sheer volume of recent approvals for sub-Saharan Africa raises the question of whether the Board of Directors is exercising sufficient due diligence over the loans it approves. Some observers are concerned that shortcuts are being taken, particularly on oversight of safeguard provisions, posing potentially serious risks to affected communities and the environment.
In March, a press release from the Government Accountability Project (GAP) revealed that the World Bank’s Africa staff had argued that the quality of loans would suffer if project preparation was rushed, and that governments would not be able to use the money effectively.
The loans approved over the last week were predominantly for the transportation and energy sectors, as well as for education and general budget support. Much of the lending still slated for approval by the end of June is expected to finance major infrastructure projects, specifically road construction.
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