receipt by the U.S. Government. Requiring that an EIA be prepared and available to the U.S. Government and U.S. public a reasonable time before votes on proposed MDB actions will enable the U.S. Government to engage in an informed decisionmaking process, and to take into account the views of interested members of the public. Equally important, as noted above, this requirement will enable the other members of the MDBS' boards to take account of environmental impacts when they vote. The amendment provides that the EIA must be made available to the public, pursuant to the Freedom of Information Act, as soon as possible after it is received by any agency or official of the U.S. Government. The Committee believes it extremely important that the public be informed as soon as possible, so members of the public may make known their views concerning the way the United States should vote. The intent of the amendment is that the United States shall not withhold any such EIA merely because it was produced by an international organization (the MDB in question) or on account of any objection by the country or countries which are the subjects of the proposed MDB actions (normally a borrower country seeking a loan), unless the President invokes the national security exception provided in the amendment and makes his reasons known to the Congress. The Committee considered applying this requirement to other international financial institutions of which the United States is a voting member, such as the International Monetary Fund. However, the Committee felt that it had too little information to do so at this time." Mr. Chairman, that concludes my statement. I look forward to working with the Committee on this important issue. 6 CRS REPORT FOR CONGRESS ENVIRONMENTAL EFFECTS OF WORLD BANK PROJECTS: by Susan R. Abbasi Specialist Environment and Natural Resources Policy Division July 17, 1987 ENVIRONMENTAL EFFECTS OF WORLD BANK PROJECTS: A SUMMARY Over the past four years the World Bank has been under close scrutiny by environmental interest groups who have brought to the Congress their evidence of negative environmental impacts of World Bank projects. In response to these allegations, some 18 hearings on these issues have been held by various committees and subcommittees of the Congress--including both authorizing and appropriations committees for the World Bank. The major concerns were that the World Bank and other multilateral development banks (MDBs) funded large projects, many of which had adverse, often unforeseen, environmental impacts. In some cases, critics argued that the major purposes of the projects were undermined by such impacts. Examples included large dam projects that failed to include watershed protections and led to erosion and siltation; irrigation projects that led to salinization of the soil due to inadequate design for drainage; and resettlement projects that led to human hardship when lands unsuitable for farming were settled for agricultural production. It was argued that the World Bank's small environmental staff, with some four to six professionals and only one ecologist, had been unable to monitor the large volume of projects undertaken by the Bank. In addition, project planning and design methods, it was argued, did not provide for inclusion of environmental considerations, and staff throughout the Bank did not have training in natural resources and environmental areas. CRS-2 Although the World Bank established its Environment Office early in the 1970s, and had numerous environmental guidelines in various sectors available, the drawbacks mentioned above--small environmental staff and lack of environmental expertise among analytical and design staff--prevented their widespread usage. As a result of the hearings process and an examination of the problems brought up by the environmental groups, the U.S. Treasury Department determined that there were environmental problems that hindered the success of World Bank projects, and U.S. Directors of the World Bank were given instructions to examine environmental impacts before voting in favor of World Bank projects. In addition, language in several successive appropriations acts that provided funding for the World Bank gave explicit direction to Treasury to examine environmental impacts of projects. 99th Congress Legislation In 1986, the continuing resolution passed in October (P.L. 99-591) contained in section 539 additional specific instructions to the Secretary of the Treasury, the Secretary of State and the Administrator of the U.S. Agency for International Development (AID). The Treasury Secretary was directed to promote a commitment by the multilateral lending institutions to add professionally trained staff with experience in ecology and related areas to: undertake environmental review of projects; develop and implement management plans to ensure systematic and thorough environment review of projects CRS-3 affecting natural resources; and create career and other institutional incentives for all bank staff to incorporate environmental and natural resources concerns into project planning and country programming activities. Specific activities by the banks are to be sought by U.S. Executive Directors of the MDBs: creation of a line unit to carry out environmental reviews of projects; appointment of an environmental adviser to MDB presidents; and programs to monitor ongoing projects to ensure enforcement of Changes to be promoted by U.S. Directors included: active involvement of environmental and health ministers in preparation of environmentally sensitive projects; participation of non-governmental indigenous peoples and conservation organizations in all stages of project planning; and informing local communities and appropriate non-governmental organizations of all project planning. environmental conditions. Additional directives to Treasury include: promoting a commitment by MDBs to rehabilitation and management of ecological resources, with special attention to soil conservation, wildlife, wetlands, estuaries, croplands, grasslands, etc.; improving programs of training in environmental sciences recipient countries; providing extension work; commitment to increasing the proportion of MDB programs supporting environmentally beneficial projects; increased emphasis on energy efficiency; promoting establishment within the Economic Development Institute of the World Bank a component to provide training in environmental and natural resource planning and program develop ment. The Secretaries of State and Treasury were directed to undertake diplomatic and other initiatives to encourage similar emphasis on environmental soundness among other representative institutions in the MDBs. The |