NGOs have criticised a decision by the Asian Development Bank (ADB) to triple its capital, claiming projects it funded have done more harm than good to communities it aims to help.
On 30 April, ADB shareholders agreed to increase the bank's capital base from US$55 billion to $165 billion to allow it to respond to the global economic crisis and help Asia's poorest countries achieve the Millennium Development Goals, including halving the number of people living in poverty by 2015.
In a new report, the ADB said the economic crisis was broader and deeper than the 1997-1998 Asian financial crisis.
The report said an ADB study estimated that 60 million people who would have been lifted out of extreme poverty would remain very poor this year and the figure could reach 100 million by the end of 2010.
ADB President Haruhiko Kuroda said on 2 May that an "immense infrastructure deficit" in Asia was a huge constraint on investment and economic growth and efforts to reduce poverty.
But the NGO Forum on ADB, a network of 250 activist groups that has been monitoring the bank’s activities since 1992, called the move "irresponsible and dangerous", alleging the region had experienced forced displacement and environmental degradation caused by ADB-funded projects.
The NGO Forum said the capital increase was largely designed for private sector clients and big infrastructure, and numerous studies had shown that such financing did not benefit the poorest.
"If not managed well, this 200 percent general capital increase could easily translate into a more than 200 percent increase in social and environmental harm," Red Constantino, executive director of the NGO Forum, said in a statement.
Displacement
According to the International Accountability Project, a global development watchdog, at current rates, approximately 15 million people in the world every year are forcibly displaced from their homes, communities and lands to make way for large development projects such as mines, dams, power plants, infrastructure and plantations.
In Nepal, 20,000 people will be forced to move from their land to make way for the planned ADB-funded West Seti Hydropower Project in the northwest, said Ratan Bandari, whose family will be among those relocated if the project goes ahead.
"We're not provided with any information about the project, except from reports," Bandari told IRIN at the ADB annual meeting on the Indonesian island of Bali from 2 to 5 May.
"There's no internal investment in the project. There are so many problems. There's no information and there's no meaningful consultation with the locals," he said.
Kuroda said the bank had done its best to make its projects environmentally sustainable.
"We have appropriate accountability mechanisms through which any complaints regarding environmental safeguards, resettlement issues could be resolved appropriately," Kuroda told a news conference on 2 May in Bali.
"I think ADB has learned quite a lot from past experiences and we have made substantial progress and I must say most of our infrastructure projects actually improve the environment," he said.
Rethinking development finance
But Stephanie Fried of the Environmental Defense Fund, a New York-based environmental advocacy group, said problems surrounding Nepal's West Seti project were not unique, and similar issues had been reported by communities affected by ADB-financed projects across the Asia-Pacific region.
"Globally, this is a real opportunity to rethink development finance. Will the ADB use its capital increase in a responsible manner or will it continue business as usual at the cost of local people and the environment?" Fried asked.
ActionAid International in a report released on 3 May said case studies from Vietnam, Nepal, Bangladesh and Cambodia suggested that ADB-financed projects had failed to reduce poverty and vulnerability to climate, food and economic crises.
In Bangladesh, more than 60,000 small farmers, fishermen and households depending on wetlands could lose their livelihoods, land and crops due to an ADB water resource management project in the southwest, ActionAid said.
The Theun-Hinboun hydropower project sent 30,000 people in Laos into poverty by depriving them of the natural resources needed for their livelihoods, it said.
More than 1,500 families have been displaced by the ADB-funded Highway 1 project in Cambodia, said Leak Kay of Conservation and Development Cambodia, an NGO.
"ADB only massages the food, economic and climate crises but does not cure, and its own version of development has added to the crisis facing poor people in Asia," said Rashed al Mahmud Titumir, ActionAid's head of policy for Asia, in a statement.
ActionAid said the bank should create a condition-free funding facility in addition to the current schemes and increase investment in agriculture with a focus on protecting small farmers.
atp/ds/mw
On 30 April, ADB shareholders agreed to increase the bank's capital base from US$55 billion to $165 billion to allow it to respond to the global economic crisis and help Asia's poorest countries achieve the Millennium Development Goals, including halving the number of people living in poverty by 2015.
In a new report, the ADB said the economic crisis was broader and deeper than the 1997-1998 Asian financial crisis.
The report said an ADB study estimated that 60 million people who would have been lifted out of extreme poverty would remain very poor this year and the figure could reach 100 million by the end of 2010.
ADB President Haruhiko Kuroda said on 2 May that an "immense infrastructure deficit" in Asia was a huge constraint on investment and economic growth and efforts to reduce poverty.
But the NGO Forum on ADB, a network of 250 activist groups that has been monitoring the bank’s activities since 1992, called the move "irresponsible and dangerous", alleging the region had experienced forced displacement and environmental degradation caused by ADB-funded projects.
The NGO Forum said the capital increase was largely designed for private sector clients and big infrastructure, and numerous studies had shown that such financing did not benefit the poorest.
"If not managed well, this 200 percent general capital increase could easily translate into a more than 200 percent increase in social and environmental harm," Red Constantino, executive director of the NGO Forum, said in a statement.
Photo: Shamsuddin Ahmed/IRIN  |
| An ADB study estimated that 60 million people who would have been lifted out of extreme poverty would remain very poor this year (file photo) |
According to the International Accountability Project, a global development watchdog, at current rates, approximately 15 million people in the world every year are forcibly displaced from their homes, communities and lands to make way for large development projects such as mines, dams, power plants, infrastructure and plantations.
In Nepal, 20,000 people will be forced to move from their land to make way for the planned ADB-funded West Seti Hydropower Project in the northwest, said Ratan Bandari, whose family will be among those relocated if the project goes ahead.
"We're not provided with any information about the project, except from reports," Bandari told IRIN at the ADB annual meeting on the Indonesian island of Bali from 2 to 5 May.
"There's no internal investment in the project. There are so many problems. There's no information and there's no meaningful consultation with the locals," he said.
Kuroda said the bank had done its best to make its projects environmentally sustainable.
"We have appropriate accountability mechanisms through which any complaints regarding environmental safeguards, resettlement issues could be resolved appropriately," Kuroda told a news conference on 2 May in Bali.
"I think ADB has learned quite a lot from past experiences and we have made substantial progress and I must say most of our infrastructure projects actually improve the environment," he said.
|
Photo: Naresh Newar/IRIN |
| In Nepal, 20,000 people allegedly will be forced to move from their land to make way for the planned ADB-funded West Seti Hydropower Project in the northwest (file photo) |
But Stephanie Fried of the Environmental Defense Fund, a New York-based environmental advocacy group, said problems surrounding Nepal's West Seti project were not unique, and similar issues had been reported by communities affected by ADB-financed projects across the Asia-Pacific region.
"Globally, this is a real opportunity to rethink development finance. Will the ADB use its capital increase in a responsible manner or will it continue business as usual at the cost of local people and the environment?" Fried asked.
ActionAid International in a report released on 3 May said case studies from Vietnam, Nepal, Bangladesh and Cambodia suggested that ADB-financed projects had failed to reduce poverty and vulnerability to climate, food and economic crises.
In Bangladesh, more than 60,000 small farmers, fishermen and households depending on wetlands could lose their livelihoods, land and crops due to an ADB water resource management project in the southwest, ActionAid said.
The Theun-Hinboun hydropower project sent 30,000 people in Laos into poverty by depriving them of the natural resources needed for their livelihoods, it said.
More than 1,500 families have been displaced by the ADB-funded Highway 1 project in Cambodia, said Leak Kay of Conservation and Development Cambodia, an NGO.
"ADB only massages the food, economic and climate crises but does not cure, and its own version of development has added to the crisis facing poor people in Asia," said Rashed al Mahmud Titumir, ActionAid's head of policy for Asia, in a statement.
ActionAid said the bank should create a condition-free funding facility in addition to the current schemes and increase investment in agriculture with a focus on protecting small farmers.
atp/ds/mw
This article was produced by IRIN News while it was part of the United Nations Office for the Coordination of Humanitarian Affairs. Please send queries on copyright or liability to the UN. For more information: https://shop.un.org/rights-permissions
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