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Carl Pope

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The New World Bank President's First Night

Posted: 04/17/2012 8:05 pm

Unfortunately wasn't at the Goldman Environmental Prize Ceremony in San Francisco. But I can't think of a better place for the new Bank President, Dr. Jim Yong Kim to have spent his first night. This year's Goldman Prize winner's place in luminous perspective one of the core challenges that Dr. Kim will face in his presidency: that the kinds of "big" development schemes that come most easily to the World Bank and similar institutions often bring with them nominal increases in gross domestic product -- economic growth as many economists define it -- but only do so by degrading the long term productivity of natural and community systems on which billions of people do -- and will -- depend.

In short, too much "development" actually stealing from the future for the benefit of the global equivalent of the 1 percent.

Even in a relatively advanced economy like Argentina, for example, Sofia Gatica and her neighbors in Ituzaingo in Mendoza, Argentina, are facing massive aerial spraying of their communities with Monsanto's Roundup herbicide combined with endosulfan, a pesticide so toxic that 80 countries have banned it, and the U.N. has called for its global elimination. Gatica lost a daughter to kidney failure, and then discovered a widespread pattern of illnesses associated with these pesticides in concentrations far greater than typical. The Argentinean government eventually placed limits on how close to residence aerial spraying could occur -- but the deeper challenge remains: growing soybeans, which could be a highly sustainable and healthy industry for a country's with Argentina's agricultural potential, has been turned into a short term, profit-maximizing but toxic and lethal extraction activity, in which the health of communities are risked to produce the highest possible volume of soy.

2012-04-17-IkalAngelei.jpg Ikal Angeli, the African Prize winner from the Turkana region of Kenya, highlights the role of the World Bank even more directly. Her campaign to stop the Gibe 3 dam which would block 90 percent of Lake Turkana's water supply to generate hydro-power for East Africa's industries and cities, faced as its first challenge the fact that the World Bank, and the EU and African Development Banks, were all financial partners in Gibe 3. When Angeli was able to persuade the Kenyan Parliament to demand an independent economic assessment (a demand the president of Kenya has ignored) and got UNESCO to oppose the continuation of construction, the Bank and its partners withdrew their financing offers, leaving Ethiopia trying to secure funding from other sources for a 40 percent completed project. But for Dr. Kim the question now becomes, how can the World Bank find ways to get capital flowing not to mega-dams like Gibe 3, but to mini-hydro, wind and distributed solar, technologies that are more suited to meeting the desperate energy needs of rural and poor communities in Ethiopia and Kenya than big dams?

This pattern, of big development projects being ramrodded through over the opposition and against the interests of local communities, particularly poor and marginal ones, is not unique to emerging countries. The North American winner this year,Caroline Cannon, is leading the effort of Inpupiat people in Point Hope, Alaska, to fight off offshore oil leases in the Chukchi Sea. When Caroline met with President Obama, he promised to protect her community. But now his Administration proposes to let Shell Oil proceed with off-shore drilling under circumstances which no one in their right mind can believe would permit a rapid clean up response if something went wrong -- under the ice in the Arctic winter. As she said last night, "Now is the time to hold him to his promise."

Dr. Kim's first big controversy is an ironic one. One of the major controversies at the World Bank is over the funding of coal fired power plants. These plants have not turned out to be very good banking investments -- the most recently commissioned, India's Mundra (one of the largest coal plants in the world), was premised on wildly unrealistic estimates of how much coal would cost, and as a result is losing vast sums of money each month it operates. So much so that the CEO of Tata Power has publicly state the project is 'economically unviable' at today's coal prices and cannot become viable without significant increases in power rates on average Indian citizens.

And they have obviously contributed to enormous public health problems for communities around them, since they are built without modern pollution controls -- not to mention the environmental devastation of mining the coal, and the climate impact of burning it.

The Bank has been debating for over a year whether or not to adopt a policy phasing out coal plants in middle-income countries like India. A sensible policy considering these countries do not need concessional loans for such projects, not to mention the local health impacts these projects for citizens to bear make the real cost of coal far higher for it's intended beneficiaries. The U.S. and Europe have been pushing for the new policy, while countries like India and China have been resisting. The candidate for Bank President who Dr. Kim beat, Nigeria's Dr. Ngozi Okonjo-Iweala, was broadly supported by the Bank's recipient nations, and during her candidacy spoke unequivocally in favor of continued Bank investment in coal. "I think the World Bank should be helping [countries] to find affordable alternatives," she said. "But where this is not possible, then using the best technology possible to try and use this coal."

But this ignores the growing calls from other developing countries that refuse to be the battleground for a political fight that sacrifices the health and livelihoods of their populations. As a result, third-world anti-coal activists like Kosovo's Nezir Sinani welcomed Kim's victory as one that supports public health and therefore limits on coal finance. But the Kosovo plant which Sinani is battling -- currently the World Bank's biggest pending coal investment -- has actually been forced upon Kosovo by a Bush-era U.S. State Department decision that due to 'zombie-like' bureaucratic inertia has failed to be overturned. If Dr. Kim's public health credentials hold true his first job will be to stop a coal project being supported primarily by a U.S. administration whose general policy has been that the Bank should not emphasize coal -- except in Kosovo! Indeed, the Obama administration's latest rule-making, requiring new coal plants in the U.S. to reduce their carbon emissions, effectively says "No" to new U.S. coal -- but we are urging the World Bank to lock a poor country like Kosovo into a dirty fuel we are no longer willing to invest in ourselves.

A veteran leader in the environmental movement, Carl Pope is the former executive director and chairman of the Sierra Club. Mr. Pope is co-author -- along with Paul Rauber -- of Strategic Ignorance: Why the Bush Administration Is Recklessly Destroying a Century of Environmental Progress, which the New York Review of Books called "a splendidly fierce book

 
 
 

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