Unformatted text preview: World Bank accused of razing Congo forests John Vidal, The Guardian, Thursday October 4 2007 http://www.guardian.co.uk/environment/2007/oct/04/congo.forests The World Bank encouraged foreign companies to destructively log the world's second largest forest, endangering the lives of thousands of Congolese Pygmies, according to a report on an internal investigation by senior bank staff and outside experts. The report by the independent inspection panel, seen by the Guardian, also accuses the bank of misleading Congo's government about the value of its forests and of breaking its own rules. Congo's rainforests are the second largest in the world after the Amazon, locking nearly 8% of the planet's carbon and having some of its richest biodiversity. Nearly 40 million people depend on the forests for medicines, shelter, timber and food. The report into the bank's activities in Democratic Republic of Congo since 2002 follows complaints made two years ago by an alliance of 12 Pygmy groups. The groups claimed that the bank‐backed system of awarding vast logging concessions to companies to exploit the forests was causing "irreversible harm". It will be discussed at board level in the World Bank within weeks and may lead to a complete rethink of how forestry in the DRC is practised. It is particularly embarrassing for the British government, which is a development partner of the bank and its third largest financial contributor. It encouraged the bank to intervene in the Congo forests with export‐driven industrial logging and has earmarked £50m for further Congo basin forestry aid. When the bank moved back into Congo in 2002, after years of war which cost up to 4 million lives, it said industrial forestry could contribute most strongly to the country's recovery. In its rush to reform the economy it devised new forestry laws, divided the county into zones and aimed to create a favourable climate for industrial logging. But although the bank is legally committed to protecting the environment, and trying to alleviate poverty, the panel found that the policies it imposed on the Congo were having the opposite social and environmental effects: An area of 600,000 square kilometres (232,000 square miles) of forest was earmarked for logging companies. The bank failed to address critical social and environmental issues. It ignored between 250,000 and 600,000 Pygmies believed to be living in the Congolese forests, even though their presence was well known and documented. It put the Pygmies in serious potential harm. Criticism is made of the forestry reforms that the bank imposed in return for loans of more than $450m. Initially, said the panel, "the bank provided [to the government] estimates of export revenue from logging concessions that turned out to be far too high. This encouraged a focus on reform of the forestry system at the expense of pursuing sustainable uses of forests, the potential for community forests and for conservation. For the most part foreign companies, or local companies controlled by foreigners, have been the beneficiaries of this," the report said. In a scathing analysis of the bank's economic reasoning, the panel said the bank had "distorted the real economic value of the country's forests" by looking solely at the tax and revenue that increased industrial logging might generate. "There seems to have been little action to support alternative uses of the forest resources," it said. The panel travelled deep into the forest to take evidence from the Pygmy communities, who told it they were not consulted before the bank launched its wide‐ranging forestry reforms. One Pygmy leader told the panel: "We are being made poor in every aspect ... the [logging] company prevents us from going into the forests." Another said that the company had bought the land so that people could no longer live in the forests. "Roads are going ever deeper into the forests, opening it up. We are increasingly deprived of our foods and drugs. We have never seen anything from the bank except promises," said a third. Research by non‐government groups last year showed that 12 foreign‐owned or foreign‐controlled companies were encouraged by the bank to dominate the entire industry. Some had concessions of more than 5m hectares, and all included Pygmy communities in their holdings. The bank is reviewing the legality of many of these concessions. Yesterday international groups that have worked with Congolese communities said they were shocked by the panel's findings. "The Pygmies must be fully involved in developing any future plans for the forest, and the bank need to find ways of helping them uphold their rights, rather than helping logging companies to destroy them," said Simon Counsell, director of the Rainforest Foundation. "The World Bank must change drastically its forest policies. Industrial logging is not contributing to poverty reduction, while its expansion undermines future financial benefits for environmental services," said Staphan van Praet, the Africa forest campaigner for Greenpeace International. Destroying African Agriculture [excerpted] Walden Bello, June 3, 2008 http://www.fpif.org/fpiftxt/5271 African agriculture is a case study of how doctrinaire economics serving corporate interests can destroy a whole continent’s productive base. * * * left the dirty details of implementation to the state bureaucracies. In Africa, where they dealt with much weaker governments, the Bank and Fund micromanaged such decisions as how fast subsidies should be phased out, how many civil servants had to be fired, or even, as in the case of Malawi, how much of the country’s grain reserve should be sold and to whom. In other words, Bank and IMF resident proconsuls reached into the very innards of the state’s involvement in the agricultural economy to rip it up. * * * At the time of decolonization in the 1960s, Africa was not just self‐sufficient in food but was actually a net food exporter, its exports averaging 1.3 million tons a year between 1966‐70. Today, the continent imports 25% of its food, with almost every country being a net food importer. Hunger and famine have become recurrent phenomena, with the last three years alone seeing food emergencies break out in the Horn of Africa, the Sahel, Southern Africa, and Central Africa. Agriculture is in deep crisis, and the causes are many, including civil wars and the spread of HIV‐AIDS. However, a very important part of the explanation was the phasing out of government controls and support mechanisms under the structural adjustment programs to which most African countries were subjected as the price for getting IMF and World Bank assistance to service their external debt. * * * Unable to deny the obvious, the Bank has finally acknowledged that the whole structural adjustment enterprise was a mistake, though it smuggled this concession into the middle of the 2008 World Development Report, perhaps in the hope that it would not attract too much attention. Nevertheless, it was a damning admission: Structural adjustment in the 1980’s dismantled the elaborate system of public agencies that provided farmers with access to land, credit, insurance inputs, and cooperative organization. The expectation was that removing the state would free the market for private actors to take over these functions—reducing their costs, improving their quality, and eliminating their regressive bias. Too often, that didn’t happen. In some places, the state’s withdrawal was tentative at best, limiting private entry. Elsewhere, the private sector emerged only slowly and partially—mainly serving commercial farmers but leaving smallholders exposed to extensive market failures, high transaction costs and risks, and service gaps. Incomplete markets and institutional gaps impose huge costs in forgone growth and welfare losses for smallholders, threatening their competitiveness and, in many cases, their survival. In sum, biofuel production did not create but only exacerbated the global food crisis. The crisis had been building up for years, as policies promoted by the World Bank, IMF, and WTO systematically discouraged food self‐ sufficiency and encouraged food importation by destroying the local productive base of smallholder agriculture. Throughout Africa and the global South, these institutions and the policies they promoted are today thoroughly discredited. But whether the damage they have caused can be undone in time to avert more catastrophic consequences than we are now experiencing remains to be seen. Walden Bello is a senior analyst at Focus on the Global South, a program of Chulalongkorn University's Social Research Institute, and a columnist for Foreign Policy In Focus (www.fpif.org) What support the government was allowed to muster was channeled by the Bank to export agriculture – to generate the foreign exchange earnings that the state needed to service its debt to the Bank and the Fund. But, as in Ethiopia during the famine of the early 1980s, this led to the dedication of good land to export crops, with food crops forced into more and more unsuitable soil, thus exacerbating food insecurity. Moreover, the Bank’s encouraging several economies undergoing adjustment to focus on export production of the same crops simultaneously often led to overproduction that then triggered a price collapse in international markets. For instance, the very success of Ghana’s program to expand cocoa production triggered a 48% drop in the international price of cocoa between 1986 and 1989, threatening, as one account put it, “to increase the vulnerability of the entire economy to the vagaries of the cocoa market.” * * * As in many other regions, structural adjustment in Africa was not simply underinvestment but state divestment. But there was one major difference. In Latin America and Asia, the Bank and Fund confined themselves for the most part to macromanagement, or supervising the dismantling of the state’s economic role from above. These institutions ...
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