No Future Without Addressing the Past

by Peter Bosshard
Saturday, December 15, 2007

The World Bank has traditionally been the most important international founder of large dams. Since its founding, the Bank has supported more than 550 dams around the globe, with over US$90 billion (in 2007 dollars) in loans and guarantees. World Bank-backed dams include some of the world’s worst development disasters, and their legacy lives on. After a short-lived period of caution and introspection, the World Bank adopted a new high risk approach to large dams in 2003. In recent years it has approved the controversial Nam Theun 2 Dam in Laos and the Bujagali Dam in Uganda (see page 3). In fiscal year 2007 alone, the Bank approved US$814 million in support for nine hydropower projects. This is $132 million more than it provided for all renewable energy and energy efficiency projects combined during the same period. The Bank’s preference for centralized, top-down approaches thus crowds out smaller, more sustainable water and energy solutions.

As the Bank plunges back into the big dam business, the legacy of its past dam projects remains unaddressed. This global legacy includes the displacement of at least 10 million people, lost livelihoods, damaged ecosystems, corruption, massive debt burdens and, in some cases, serious human rights violations. The landmark report of the World Commission on Dams (WCD) found in 2000 that “in too many cases an unacceptable and often unnecessary price has been paid to secure the benefits [of dams], especially in social and environmental terms.”

World Rivers Review has repeatedly covered the unresolved legacy of the World Bank’s past dam projects. Africa’s Tonga people, who were forced from their lands along the Zambezi River by the Kariba Dam in the 1950s, are still awaiting assistance to rebuild their lives. Guatemalan farmers are still seeking justice for the murder of hundreds of family members who opposed the Chixoy Dam between 1982 and 1984. Affected people have been left impoverished by the Lesotho Highlands Water Project, while multinational companies enriched themselves through corrupt dealings. And coastal communities in Pakistan continue to be harmed by a seriously deficient drainage project and the floods and devastation it causes (see p. 4).

The World Commission on Dams recognized that dam builders can only regain their credibility if they address the ongoing human suffering and environmental degradation which their past dams have caused. The WCD report proposed in 2000 that “outstanding social issues associated with existing large dams [be] identified and assessed,” and that “processes and mechanisms [be] developed with affected communities to remedy them.” Governments, the dam industry and funders such as the World Bank share the responsibility to do so.

The World Bank has rhetorically endorsed the strategic priorities of the WCD, including the need to address the legacy of past dams. Yet it still lacks the necessary tools to do so in its own projects. The Bank rarely monitors projects after their physical completion. It cannot provide grants, but only new loans or credits, to compensate affected people for their losses. The Bank’s Inspection Panel, which has documented harmful violations of internal policies, has no mandate to monitor and ensure that remedial actions are implemented.

The World Bank defends its renewed zeal for large dams with assertions that it has learned from past mistakes. This claim is not credible as long as it does not address the legacy of its own failures. The Bank urgently needs to develop the tools required to address its big dam legacy. These tools include the following:

The World Bank should provide reparations from its own resources. It should work directly with communities who have been harmed in its past projects to develop reparations processes and rehabilitation plans.

The mandate of the Inspection Panel should be extended to include the review and monitoring of remedial actions.

The Bank should help develop an enforceable compliance system for addressing the needs of dam-affected people. As recommended by the WCD, such a system should include benchmarks for success, and the use of financial guarantees to underwrite commitments to affected people. Truly independent monitoring bodies, which include members of civil society, must be created. The choice of such bodies should be left to affected communities.

Until they have developed the tools for actively addressing the legacy of its dams, International Rivers will continue to keep the World Bank and other dam builders accountable for the failures of their past projects.