World Bank, Greens Ready for Faceoff

WASHINGTON —  The annual meeting of the World Bank is usually a staid affair, with finance ministers chatting over canapes at cocktail hour and gliding around Washington in limousines. But this year, that cozy decorum may be jolted: The Greens are coming.

Environmentalists from 70 countries, dissatisfied with the World Bank’s policies, are planning a protest march, seminars and sessions with top officials during the Sept. 25-28 meeting that will give them a far more visible presence here than they have ever had before.

They want the World Bank to step up pressure on debtor countries to end deforestation and other practices that may have short-term value in economic development but ultimately damage the environment.

They will urge the 151-country institution to place environmental conditions on loans to Third World countries--in particular, to require that loan recipients take steps to slow the perceived warming of the atmosphere, which some scientists have warned could cause rising seas and environmental calamity.

Insulated by Secrecy

Phil Williams, president of International Rivers Network, which is organizing the effort, said that the World Bank has been guilty of a “stubborn refusal to recognize the link between environmental destruction, impoverishment and economic collapse.”

Williams said the huge dam projects that the bank has sometimes financed “do nothing but hurt the very people they are meant to help.” He said the bank has “insulated itself from outside criticism through secrecy and obfuscation.”

Bank officials say they have already delayed or scrapped a number of plans, including a rural electrification project in Brazil and a dam in India, out of environmental concerns.

“We no longer even are talking about loans like that,” said a senior bank official, who added that the bank has changed so much that some of its member countries fear that its economic goals may be jeopardized.

For the environmentalists, getting much more might prove difficult. Although the Greens’ scorched-earth political tactics--massive demonstrations and inflammatory rhetoric--may influence national legislatures, they sometimes backfire when used on the more stolid national finance ministers.

William R. Cline, an analyst with the Institute for International Economics, predicted that the bank will maintain a cautious approach to environmental issues as long as the industrial countries that supply the funds that the bank lends “want it to get on with development projects without any costly delays.”

“There’s no indication yet that the World Bank is ready to begin telling countries such as China that, say, they no longer can develop their coal,” Cline said.

This year’s fireworks have already begun over the issue of global warming. The environmentalists say they want the World Bank to “recognize” the dangers from global warming and to use the bank’s financial leverage to prod client countries into actions that will help to head it off.

No Patience

But the bank’s own assessment--and that of many private scientists as well--is that while the global warming issue deserves close monitoring, the evidence is not yet conclusive that it is reaching crisis proportions. The Natural Resources Defense Council earlier this month leaked a bank staff paper recommending such a middle-of-the-road approach.

Environmentalists have no patience with that attitude. Paul J. Allen, an NRDC spokesman, called “preposterous” World Bank President Barber B. Conable’s statement, in a speech last Monday, that some warming of the atmosphere might be beneficial. Allen called this “symptomatic of the bank’s failure” to live up to earlier pledges to overhaul its environmental policies.

For most of its 43 years, the bank has kept strictly to an economic agenda, first rebuilding war-torn Europe and later aiding development in the Third World. Along with many of society’s institutions during those years, it essentially ignored environmental concerns.

As a result, the bank’s “achievements” have included some admitted environmental atrocities. The one most often cited--the financing of road-building across Brazil’s Amazon River basin--is spectacular by any measure. Several dam projects also are on the Greens’ lists.

But in the mid-1980s, largely as a result of pressure from the United States, the bank began changing its position. It has stopped several projects that threatened the environment. It has incorporated ecological concerns into its planning and increased its lending to environmental projects. In recent years, the bank has:

- Held up a $200-million road-building project in northwestern Brazil for three years, until the Brazilians worked out ways to soften its impact on native settlements.

- Suspended processing of $225 million for rural electrification in Brazil because the project did not protect forests and soil.

- Halted a multimillion-dollar dam and hydroelectric plant on the Narmada River in India because it would have displaced masses of people.

Third World Resistance

Now the institution is working on a novel accounting system that would help it predict the economic impact of damage to natural resources. And it is preparing new proposals on environmental issues for the finance ministers to consider next week.

Conable, a former U.S. congressman with decidedly more concern for environmental issues than most international officials, has been far more receptive to such change than his predecessors. “We need to do more,” he conceded in his speech last week.

But the bank faces obstacles that could leave its management and the more aggressive environmental groups at odds for the foreseeable future.

For one, Third World countries are angrily resisting restrictions designed to protect the environment. They say the industrialized nations were not shackled with such rules, and some of the poorer countries even see the bank’s new stance as evidence of a plot to keep them down.

Brazil’s President Jose Sarney has rejected outsiders’ demands about Amazon projects as challenging his nation’s sovereignty. And Conable pointed out last week that residents of the Third World, the bank’s major client, are responsible for only a fraction of world’s pollution.

Second, although the bank’s top management is awakening to environmental concerns, the institution’s governing board, whose members are appointed by the finance ministries of the 151 member countries, has indicated that it does not want the bank to move too rapidly on the issue.

sh ‘Real Logjam’

“The U.S. is a little bit alone in this right now,” said a U.S. official who is familiar with the board’s operations. “Most of the other industrialized countries feel that the initial steps have been taken and it’s time for the bank to catch its breath.”

The board finds it difficult enough to prod Third World governments into making needed economic reforms, and some board members fear that placing environmental conditions on development funds would impede that effort. Cline said that may already have happened in Brazil, where the bank’s decision to cut off loan money, partly because of pressure from environmentalists, “has contributed to a real logjam that has made Brazil’s short-term financing problems more acute.”

And some of the Greens’ demands--that environmentalists be given World Bank staff jobs and that local environmental groups be given veto power over the banks’ projects--have particularly annoyed bank officials.

“The real issue now is that environmentalists want to pre-screen every project,” complained one U.S. official who has been sympathetic to their broader goals. “Some want to stop development to protect the environment, while others want to use whatever leverage is necessary, no matter what. But at the end of the day, it’s the decision of the country and the institution to decide.”

U.S. officials also complain that environmental groups have been too quick to marshal forces in Congress to exert pressure on the bank--a practice that sometimes alienates other governments that believe the institution is already too willing to do America’s bidding.

Largely to satisfy domestic constituents, the U.S. lawmakers have added to appropriations bills some two dozen amendments requiring Treasury Department officials to oppose specific bank practices or to make costly--some say unnecessary--studies of environmental impact.

Uncharacteristic Reserve

“No one’s got what it takes to stand up to (the environmentalists) and say ‘Enough is enough,’ ” one American official said. Another worried that if Congress cuts the U.S. contribution to the World Bank, it will only reduce America’s potential influence on the institution’s policies.

Perhaps because they realize that, the environmentalists are approaching this year’s World Bank meeting with what some would describe as uncharacteristic reserve. Except for one protest march over three and a half blocks, they plan no mass demonstrations.

Even Greenpeace, which routinely sends its speedboats to intercept whaling ships on the high seas, has forsaken guerrilla-theater tactics. Instead, “there will be a lot of negotiations with bank staff,” said Kay Treakle, a Greenpeace spokesman.

Still, the strains are likely to continue. The recommendations that the bank has prepared for the finance ministers next week, while calling for increased attention to the environmental issue, do not propose any sweeping new program.

Brent Blackwelder, vice president of Friends of the Earth, one of the groups participating in next week’s blitz, says the environmentalist organizations will keep pushing for change.

“They’ve changed some of their rhetoric,” Blackwelder said of World Bank officials, “but right now, we’re having a hard time getting anything but lip service. The bank could do a lot more, could be leading the way. But they’re just sitting there with blinders.”

The environmentalists say they want the World Bank to “recognize” the dangers from global warming and to use its financial leverage to prod countries into actions that will help to head it off.