NGOs Tell World Bank to Reconsider Bujagali Dam

Monday, May 20, 2002

In a May 2002 letter to Executive Directors, 120 NGOs urge the Bank to delay further funding approvals until a report by the Inspection Panel on the dam’s violations of Bank policy is released. They also request a "more realistic" economic assessment of the project, and a release of the project contract in Uganda.

Executive Directors
World Bank Group
1818 H Street, NW
Washington, DC 20433

Re: Bujagali Hydropower Project

Dear Executive Directors,

In December 2001, the World Bank’s Executive Board approved IFC and IDA funding of up to $225 million for the Bujagali Hydropower Project in Uganda. Several other financial institutions – including US OPIC, the United Kingdom’s ECGD, and Germany’s DEG – have declined involvement in the project. Sweden’s EKN has declined for the time being, and the export credit agencies of Norway and Finland have not yet taken any decisions. According to the reputed journal, "Development Today", EKN concluded that the project was "too risky".

Management now hopes to extend a MIGA guarantee of $215 million to the Bujagali project. Such a guarantee would cover the project’s political risk, would pull Nordic export credit agencies back into the funders’ consortium, and would thus rescue the project.

Ugandan and international NGOs have a series of concerns regarding the economic, social, environmental and cultural impacts of Bujagali. Ugandan NGOs and citizens submitted a complaint to the World Bank’s Inspection Panel in July 2001. We assume that the report on Bujagali will be completed very soon, but understand it has not yet been submitted to the Board.

A new report published by International Rivers on May 14, 2002, suggests that World Bank management and staff have seriously manipulated the appraisal of the purported economic viability of Bujagali, and may in fact have misled Executive Directors when support for the project was approved in December 2001. The International Rivers report documents that:

The World Bank’s and IFC’s Project Appraisal Document for Bujagali contains major discrepancies with other relevant Bank documents regarding essential aspects of the project. Discrepancies include figures on crucial aspects of the project, such as the future demand for expensive power from Bujagali.

The World Bank’s and IFC’s project documents misrepresent or withhold critical information from other Bank documents. They misrepresent the outcome of a private enterprise survey, which is used to justify the project, and do not inform readers that reports commissioned by IFC show a combined–cycle plant and geothermal energy to be the least–cost sources of power for Uganda.

The Bank’s and IFC’s project documents neglect evidence from other Bank projects, and from other official sources, on important features of the Bujagali project and Uganda’s power sector. Aspects which have been neglected include the potential impact of climate change on Bujagali’s hydrology.

Finally, the World Bank’s and IFC’s projections have already been proven over–optimistic regarding the growth of Uganda’s export revenues, and overall economic growth.

In conclusion, the International Rivers report puts forward strong evidence that Bujagali is not the least–cost option for Uganda’s power sector, that the project is economically highly unfavorable, and that it will add to Uganda’s debt burden – at a time when the IMF and IDA have recently expressed concern about Uganda’s "very high debt indicators.

Since the Executive Board approved IFC and IDA funds for Bujagali in December 2001, the context of the project has changed significantly. The International Rivers report produces serious evidence that Bank management and staff have misrepresented or withheld relevant information on Bujagali. Export credit agencies have declined involvement for economic reasons, which should encourage the Bank to reconsider the viability of the project. Finally, Uganda’s economic situation and debt outlook have deteriorated sharply since December 2001, as documented by an IMF/IDA report in April 2002.

We recommend that before taking any further decisions on Bujagali, the Executive Board should insist that the following conditions are met:

The World Bank Inspection Panel should submit its report on the Bujagali project to the Board and the claimants, and the Board should have the chance of an informed debate on the Panel’s findings.

A comprehensive and balanced assessment of all options for Uganda’s power sector should be carried out and submitted to the Board for discussion. In particular, such an assessment should take an in–depth look at geothermal power, which appears to be the least–cost option in the assessment done for IFC by Acres International.

If MIGA continues to consider supporting the Bujagali project, the economic viability of the project should be reappraised with a more realistic view of essential project and sector features, and taking into account the recent economic down–turn in Uganda.

The World Bank should request that the Bujagali Power Purchase Agreement be made public, so that the interested public can have an informed debate about the Ugandan government’s long–term obligations under it.

Civil society in Uganda should have the chance of an informed debate about the Inspection Panel report, the conclusions of an effective options assessment and the Power Purchase Agreement. The Executive Board should take such a debate into account before reconsidering the Bujagali project or its alternatives.

Thank you for your consideration of these concerns and recommendations.

Sincerely yours,

Frank Muramuzi, President
National Association of Professional Environmentalists

Juliette Majot, Executive Director
International Rivers

Carol Welch
Friends of the Earth/US

OTHER ENDORSERS (listed by country)


Martin Musumba
SAVE Bujagali Crusade

Basalirwa Asuman
SAVE Bujagali Crusade, Makerere Branch

Beatrice Obbo
National Association of Professional Environmentalists (NAPE)
Requester, representing people from Tororo – Eastern Uganda

Kamese Geoffrey
Rio + 10 Coalition: Intergrated Fresh Water Management Thematic Group

Timothy Byakola
Climate and Development Initiatives

Rosemary Namirembe
Uganda Environment Education Foundation (UEEF)

Kimbowa Richard
Uganda NGO Rio + 10 Coalition

Sentamu Somon
Joint Energy and Environment Projects (JEEP)

David R. Mutekanga
Uganda Wildlife Society

Kenneth Kakuru

Tabaro Denis and Weizire James
Adult Literacy and Basic Education Centre (ALBEC)

Dranda Richard
Adult Literacy and Basic Education Centre, Makerere University

Dr. Waiswa G. Baker
Interdisplinary Teaching of Human Rights, Peace, and Ethics

S. B. Tindifa
Human Rights and Peace Centre (HURIPEC), Makerere University

Kalema Billy
Interdisplinary Teaching of Human Rights Peace and Ethics Project, Makerere University

F. C. Oweyegha–Afunaduula
Department of Zoology, Makerere University

Kayondo Fred
East African Communities Organization for Mgt. of Lake Victoria Resources – Mukono District (ECOVIC)

Mugisa Patricia
Organization of Graduate Youth for the Enhancement of Environment Programmes and Poverty Alleviation (OGYEEPPA)

Alfred T. Balinda
Requester to the Inspection Panel on behalf of Concerned Citizens

Prof. Jassy Kwesiga and Jane Nabunnya
Development Network of Indigenous Voluntary Associations (DENIVA)

Fredric Musisi Kabuye
International Institute for Cultural and Ethical Development
DENIVA Board of Directors

Dick Nuwamanya

Bautu Robert
Faculty of Law, Makerere University–Kampala

Isoto Bibian
Faculty of Law Makerere University

Mayanga Dan
Global Insurance Company

Jane Afra Musinguzi
Professional Teacher/Environmentalist

Deo Lubega

Sylivia Birungi


Elba Stancich
Taller Ecologista

Jorge Cappatto
Federacion Amigos de la Tierra Argentina (FoEI)

Roque Pedacce
Amigos de la Tierra Buenos Aires

Anna Petra Roge de Marzolini
Asociacion Ambientalista EcoLaPaz

Susana Garay
MyPIMA –Esquel Chubut


Cam Walker and Damian Sullivan
Friends of the Earth Australia

Kate Walsh
AID/WATCH – Australia

John Sinclair
Fraser Island Defenders Organization

Terrie Templeton
WTO Watch
Community Information Association


Roberto Smeraldi
Friends of the Earth – Brazilian Amazon


Galina Georgieva
NM Ecoglasnost/FoE Bulgaria


Pamela Foster
Halifax Initiative Coalition

Grainne Ryder
Probe International


Juan Pablo Orrego
Fundación Terram

Andrea Munizaga
Comité Nacional Pro Defensa de la Fauna y Flora– Amigos de la Tierra Chile


Gabriel Rivas–Ducca
Coecoceiba–Friends of the Earth Costa Rica


Tove Selin
Finnish ECA Campaign


Roberto A. Epple
ERN European Rivers Nettwork

Philippe Lhort
SOS Loire Vivante

Camille de Maissin
Agir Ici


Heffa Schuecking

Heike Drillisch
WEED (World Economy, Ecology & Development)


Jaroslava Colajacomo and Antonio Tricarico
Campaign to Reform the World Bank

Elvira Dizon
Franciscan Missionaries of Mary


Ikuko Matsumoto
Friends of the Earth Japan


Argwings Odera
Sondu–Miriu Community Advocacy Campaign


Medha Patkar
Narmada Bachao Andolan

Ashish Fernandes
Sanctuary Asia

S. Parasuraman

Shripad Dharmadhikary,
Manthan Adhyayan Kendra (Manthan Reserach Centre)
Member of Dams and Development Project Steering Committee

Manoj Saranathan
Friends of River Narmada


Anung Karyadi
National Coordinator Indonesia for RWESA

Nur Hidayati
WALHI (Indonesian Forum for Environment)/FoE Indonesia


S.M. Mohamammed Idris
Friends of the Earth Malaysia and Consumers’ Association of Penang Malaysia


Cecilia Sánchez
INCIDE, Desarrollo y Estrategias en Comunicacion A.C.


Anabela Lemos


Monique de Lede
Friends of the Earth Netherlands

Wiert Wiertsema

Joyce Kortlandt

Chelsea Mozen
ASEED Europe – Action for Solidarity, Environment, Equality, and Diversity


Environmental Rights Action (ERA)/Friends of the Earth


Tonje Folkestad
FIVAS (Association for International Water and Forest Studies)


Naeem Iqbal
Pakistan Network of Rivers Dams and People


Sanis Kak
Kasela Palu Group


Joan Carling
Cordillera Peoples Alliance


Luís Galráo

Maria Joáo Pereira
Liga para a Protecá"o da Natureza (LPN)


Demba Moussa Dembele
Forum for African Alternatives


Roman Havlicek
Friends of the Earth – Slovakia

Juraj Zamkovsky
Center for Environmental Public Advocacy


Juan Carlos Rodríguez Murillo
Ecologistas en Acción


Liane Greeff
Environmental Monitoring Group

John Taylor
Sustainable Water Forum

Patrick Dowling
The Wildlife and Environment Society of South Africa

Patrick Bond, Professor
University of the Witwatersrand, Johannesburg


Johanna Sandahl


Peter Niggli
Swiss Coalition of Development Organizations

Christine Eberlein
Berne Declaration


Alex Wilks
Bretton Woods Project

Sean Scannell
Ilisu Dam Campaign

Johan Frijns
Friends of the Earth International

Nick Hildyard
The Corner House

Chris Woodford
UK Rivers Network


Shiney Varghese
Institute for Agriculture and Trade Policy

Soren Ambrose
50 Years Is Enough Network

Joanne Carter

Paul Jenkin
Surfrider Foundation, Ventura County Chapter/Matilija Coalition

Tom Bolema
High Desert Greens, Antelope Valley

Paula Palmer
Global Response

John Peck
University of Wisconsin Madison Greens

Graham Saul
Bank Information Center

Dan Silver
Endangered Habitats League

Neil Watkins
Center for Economic Justice

Diana Bohn
Nicaragua Center for Community Action

Mara Vanderslice
Jubilee USA Network

Janet Gottschalk, MMS
Alliance for Justice

Marty Bergoffen
Southern Appalachian Biodiversity Project (SABP)

Bruce Rich
Environmental Defense

Shankar Krishnan
Friends of River Narmada

Daphne Wysham
Institute for Policy Studies

Erica Etelson
Project Underground

Rita A. Clark
The Nicaragua–US Friendship Office

Mary Turgi
Congregation Justice Committee/Sisters of the Holy Cross

Sage Douglas Eagle Remington
Southern Ute Grassroots Organization (SUGO)
Southern Ute Indian Reservation

Taleigh Smith
Dos Pueblos

Alan Muller
Green Delaware

Frances Bartelt
Wisconsin Fair Trade Campaign /Milwaukee

Noah Madlin
Rainforest Action Group for Indigenous Peoples

Tony Littman
SF Bay Area Jubilee Debt Cancellation Coalition

Margaret Nagel
Neighbors for Peace/GeneWise

Iris Young, Professor
Political Science, University of Chicago


Teresa Perez
World Rainforest Movement