Making Sustainable Urban Air Quality Commitments ... · Estanislao Gacitœa, Carlos Sojo with Shelton Davis August 2001. (Also available in Spanish.) Interest Groups and Organizations

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Urban Air QualityManagement —

CoordinatingTransport, Environ-

ment, and EnergyPolicies in Develop-

ing Countriesby Masami Kojimaand Magda Lovei,

September 2001.68 pages.

(ISBN 0-8213-4948-1)$10.00

For information on how to obtain these publications, please call the World BankEnvironment Department at (202) 473-3641, or e-mail [email protected].

BiodiversityConservation in theContext of TropicalForest Managementby Francis E. Putz,Kent H. Redford, JohnG. Robinson, RobertFimbel, and GeoffreyM. Blate, September2000. EnvironmentDepartment PaperNo. 75. 88 pages.

DevelopingIndicators —

Lessons Learnedfrom Central America

by Lisa Segnestam incollaboration with

Manuel Winograd andAndrew Farrow,

November 2000.56 pages. (Available

in Spanish.)

Social Exclusion andPoverty Reduction inLatin Americaand the Caribbeanby Estanislao Gacitúa,and Carlos Sojo,with Shelton Davis,August 2001. 304 pages.(Available in Spanish.)

World Bank/WWFAlliance for ForestConservation &Sustainable Use —Annual Report 200040 pages.Visit the Alliance websiteat: http://www-esd.world-bank.org/wwf.

Improving Urban AirQuality in South Asiaby Reducing Emis-sions from Two-Stroke EngineVehiclesby Masami Kojima,Carter Brandon, andJitendra Shah,December 2000.60 pages.

Making SustainableCommitments —An EnvironmentStrategy for the

World BankSeptember 2001.

276 pages.(ISBN 0-8213-4935-X)

$22.00

Agricultural TradeLiberalization in a

New Trade Round —Perspectives of

Developing Countriesand Transition

EconomiesWorld Bank Technical

Paper No. 418 byMerlinda Ingco and L.

Alan Winters, eds.September 2001. 172

pages. (ISBN 0-8213-4986-4). $22.00

toward environmentally and socially sustainable development � 2001

mattersA T T H E W O R L D B A N K

An Environment Strategy for the WAn Environment Strategy for the WAn Environment Strategy for the WAn Environment Strategy for the WAn Environment Strategy for the World Bankor ld Bankor ld Bankor ld Bankor ld Bank

In many developing countries, the costs of environmental degradation have beenestimated at 4 to 8 percent of GDP annually. Natural resources degradation�depleted soils, insufficient water, rapidly disappearing forests, collapsed fisher-

ies�threaten the quality of life of millions of people. Environment problems alsothreaten the health of millions; an estimated 6 million people die annually, andmany more get sick, in developing countries from water-related diseases, indoor airpollution, urban air pollution, and exposure to toxic chemicals. Environmentaldegradation also increases the vulnerability of people to natural disasters. Theimpact of environmental degradation threatens the basis for growth and livelihoodstoday and in the future. Environmental degradation also reaches across borders,affecting the quality of the regional and global commons. The Environment Strategyis responding to these challenges.

This Environment Strategy outlines how the World Bank will work with clientcountries to address their environmental challenges and ensure that Bank projectsand programs integrate principles of environmental sustainability. The Strategy setsa vision, objectives, and a course of action for the longer term and suggests specificactions, targets, and institutional measures for the next five years, as described inTables 1 and 2 of the Executive Summary. The Strategy is the product of a multi-yeareffort, including an extensive evaluation of the Bank�s past performance, andnumerous workshops and consultations with client governments, civil society,academia, multilateral and bilateral development agencies, and representatives ofthe private sector.

Over the last two decades, the Chinese government has made significantinroads in battling a range of environmental problems�including airpollution, water pollution, and deforestation. Yet environmental challenges

are likely to be far greater and more complex over the next 10 years, which willrequire a significant change in development strategy. This is the main finding of anew World Bank report entitled China: Air, Land, and Water � EnvironmentalPriorities for a New Millennium, which was released in August 2001.

The report was prepared by a World Bank team and assisted by technical specialistsfrom 10 Chinese research institutes, universities, and NGOs. It reviews the state ofChina�s environment, assesses the effectiveness of the government�s environmentalprotection work over the last 10 years, and makes recommendations on how toaddress the new challenges that will face the country over the next decade. Thereport points to three areas of success: broad-based and absolute reduction inindustrial air and water pollutant emissions during the second half of the 1990s; thereversal of deforestation through massive investments in reforestation and afforesta-tion; and the reversal of secondary salinization in irrigation areas through majorprograms of both control and prevention.

Overall, the report urges that China�s environmental strategy needs to become moreproactive. The current approach focuses mainly on remedying the adverse environ-mental effects of previous development decisions. In the future, more emphasisshould be placed on avoiding or minimizing the adverse environmental effects ofdevelopment policy in the first place.

Written for a broad audience, this book will be of interest to all those concernedabout environmental quality in Asia. A CD-ROM, which is included in the book,provides background research and additional technical detail.

MAKINGSUSTAINABLE

COMMITMENTS

MAKINGSUSTAINABLE

COMMITMENTS

To obtain these publications, please visit or contact the World Bank Info Shop at 701 18th Street, N.W., Washington, D.C.Phone 202-458-5454, fax 522-1500, website http://www.worldbank.org/infoshop/, e-mail: [email protected].

major

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publications

CHINA �AIR, LAND,AND WATER


Environmental Priorit ies for a New MillenniumEnvironmental Priorit ies for a New MillenniumEnvironmental Priorit ies for a New MillenniumEnvironmental Priorit ies for a New MillenniumEnvironmental Priorit ies for a New MillenniumName___________________________________________________________________________________

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To order other Environment Department publications, refer to our publications list and write those you would like

to receive below. To order more than 4, please contact the Environment Department publications office directly.

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Mail or fax to: Environment Department Publications Fax: (202) 477-0565; phone (202) 473-3641The World Bank1818 H Street, N.W., Room MC-5-126Washington, D.C. 20433 U.S.A.

Improving Urban Air Quality in South Asia by ReducingEmissions from Two-Stroke Engine VehiclesMasami Kojima, Carter Brandon, and Jitendra ShahDecember 2000

Cleaner Transport Fuels for Cleaner Air in Central Asiaand the CaucasusMasami Kojima, Robert W. Bacon, Martin Fodor, andMagda LoveiAugust 2000

Rural DevelopmentRural DevelopmentRural DevelopmentRural DevelopmentRural Development

Agricultural Trade Liberalization in a New Trade Round �Perspectives of Developing Countries and Transition EconomiesWorld Bank Technical Paper No. 418Merlinda Ingco and L. Alan Winters, eds.September 2001. (ISBN 0-8213-4986-4)Available for purchase in the World Bank Bookstore andonline at http://publications.worldbank.org

Rural Non-Farm Activities and Rural Development � FromExperience Towards StrategyRural Strategy Background Paper No. 5Peter Lanjouw and Gershon FederAvailable on the online World Bank Rural publications catalogat http://wbln0018.worldbank.org/essd/essd.nsf/RuralDevelopment/Pubs

What Has Changed Regarding Rural Poverty Since Vision toAction?Rural Strategy Background Paper No. 4Harold AldermanAvailable on the online World Bank Rural publications catalogat http://wbln0018.worldbank.org/essd/essd.nsf/RuralDevelopment/Pubs

Social DevelopmentSocial DevelopmentSocial DevelopmentSocial DevelopmentSocial Development

Social Exclusion and Poverty Reduction in Latin Americaand the CaribbeanEstanislao Gacitúa, Carlos Sojo with Shelton DavisAugust 2001. (Also available in Spanish.)

Interest Groups and Organizations as StakeholdersRobert Bianchi, Sherrie A. Kossoudji, SDV 35, June 2001.

Social Analysis, Selected Tools and TechniquesRichard A. Krueger, Mary Anne Casey, Jonathan Donner,Stuart Kirsch, and Jonathan Maack, SDP36June 2001

Inclusion and Local Elected Governments � The PanchayatRaj System in IndiaRuth J. Aslop, Anirudh Krishna, and Disa Sjoblom, SDP 37May 2001

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elcome to the 2001 edition of Environment Matters, which reviews the World Bank’s cur-rent environmental activities and describes the challenges ahead.

We have a very real chance of reducing world poverty, and doing so in a manner consistent with aclear social and environmental conscience. But it takes actions across all communities of the world—from a small farmers’ organization to a large private multinational corporation to the western governments of the world.

The international development community is now reaching a consensus on the critical development goals facing the worldon several fronts, and in every case environmental issues are a large part of the agenda. Particularly significant is an effortby the international development agencies to draft a common set of development goals; and important for the Bank is thenew World Bank Environment Strategy. In both of these initiatives, there is a redoubled effort to strengthen the linkagesbetween environment and poverty reduction goals.

The leaders of the major international development institutions—including the United Nations, Organisation for EconomicCo-operation and Development, International Monetary Fund, and the Bank—are working to develop a common set ofinternational development goals. The discussions in progress focus on integrating the international development goalsagreed to by these four institutions with the UN’s Millennium Development Goals. Ensuring environmental sustainabilityis one of the seven agreed goals.

The challenge ahead is to convert these goals into real progress on the ground. Environmental health risks still cause nearly20 percent of the burden of disease in developing countries; natural resources are under great pressure; and natural andman-induced disasters continue to cost billions of dollars and countless personal tragedies around the world.

To help make these goals a reality, the World Bank’s Environment Department has completed Making Sustainable Commit-ments, the Bank’s new Environment Strategy. For the first time, the Bank has consolidated its approach to environmentalprotection into a single document. The strategy will ensure economic growth does not come at the expense of people’shealth and future opportunities because of pollution and degraded natural resources and ecosystems. We have strived tointegrate environment into the development agenda of the Bank because sustainability is at the heart of development.

The Environment Strategy, which is the primary focus of this issue of Environment Matters, builds upon ongoing efforts andprograms. It considers lessons from the past, responds to a changing Bank and a changing global context, and deepens ourcommitment to sustainable development. The new elements of the Strategy include a strengthened emphasis on poverty-environment linkages and local environmental concerns; an increased focus on tools that help integrate environment intosectoral programs and policies; and efforts to improve institutional incentives to mainstream sustainability in projects.

The Strategy poses many new challenges for the way the Bank conducts its business. It stresses the need to strengthenaccountability and incentives; coordinate across sectors; improve the skills mix; adjust budgets to reflect corporate priori-ties; realign partnerships to effectively leverage scarce Bank resources; and monitor progress to track the implementation ofthe Strategy and the Bank’s performance.

In short, the international development community has set a clear direction for the future. Collective community action isneeded, and the World Bank will play its part. In the coming decades, we must find better ways to bring together govern-ments, the private sector, NGOs, local communities, and civil society to end poverty and build a sustainable world for ourchildren and grandchildren.

Ian Johnson

VICE PRESIDENTEnvironmentally and Socially Sustainable Development

letterfrom the

W

The World Bank Group

The World Bank

IBRD IDA IFC MIGA ICSIDInternational Bank

for Reconstruction

and Development

International

Development

Association

International

Finance

Corporation

Multilateral

Investment

Guarantee Agency

International

Centre for

Settlement of

Investment

Disputes

Est’b 1945183 countries own,

subscribe to its capital

Est’b 1960161 members

Est’b 1956174 countries



Lends to creditworthyborrowing countries,based on high real ratesof economic return

Lends at a favorablerate to poorercountries with a percapita GNP of less than$885

Assists economicdevelopment bypromoting growth inthe private sector

Assists economicdevelopment throughloan guarantees toforeign investors

Provides facilities forthe conciliation andarbitration of disputesbetween membercountries and investorswho qualify as nationalsof other membercountries

Welcome to matters. . .

Notes:

All $ = U.S. dollars.

Image on page 6 from Bhutan.

All images contained in the biodiversitybar on pages 10–23 were taken byJ. & K. MacKinnon.

IBRD maps numbered 31562 through31567 contained in the Regionalsection of the magazine wereproduced by the Map Design Unit ofthe World Bank. The boundaries,colors, denominations and any otherinformation shown on these maps donot imply, on the part of the WorldBank Group, any judgment on the legalstatus of any territory, or anyendorsement or acceptance of suchboundaries.

Environment Matters is a magazine ofthe World Bank Group. Also visit themagazine at the Bank’s website —http://www.worldbank.org/

Environmentally and Socially SustainableDevelopment Network Managers

Chair

Ian JohnsonEnvironment

Kristalina I. GeorgievaRural

Robert L. ThompsonSocial

Steen Lau Jorgensen

Environment Matters is produced by theWorld Bank’s Environment staff withcontributions from the Bank’s Regions.

Editorial & Production Teamfor the Annual Review

Technical EditorsKirk Hamilton and Stefano Pagiola

Story EditorRobert T. Livernash

Managing and Photo EditorJim Cantrell

Editorial AssociateJason Steele

Special Contributors

Anjali AcharyaKristyn EbroAnita Gordon

Publications Info: 202-473-1155General Inquiries: 202-473-3641Department Fax: 202-477-0565Web address: http://www.worldbank.org

Printed with soy ink on recycled, chlorine-free paper. Please recycle.

The World Bank Group1818 H Street, N.W.Washington, D.C. 20433

Founded in 1944, the World Bank Group consists of five closely associated institutions. Our

mission is to fight poverty for lasting results and to help people help themselves and their environ-

ment by providing resources, sharing knowledge, building capacity, and forging partnerships in

the public and private sectors.

The World Bank Group is owned by 183 member countries who are represented by a Board of

Governors and a Washington-based Board of Directors. Member countries are shareholders who

carry ultimate decisionmaking power in the World Bank.

Headquartered in Washington, D.C., the Bank operates in 100 country offices and has approxi-

mately 10,600 employees. James D. Wolfensohn is president of the five institutions.

The World Bank Group is the world’s largest source of development assistance. In fiscal 2000, the

institution provided more than $15 billion in loans to its client countries. It works in more than

100 developing economies, with the primary focus of helping the poorest people and the poorest

countries. For all its clients, the Bank emphasizes the need for:

� Investing in people, particularly through basic health and education

� Focusing on social development, inclusion, governance, and institution-building as key elements

of poverty reduction

� Strengthening the ability of governments to deliver quality services efficiently and transparently

� Protecting the environment

� Supporting and encouraging private business development

� Promoting reforms to create a stable macroeconomic environment that is conducive to investment

and long-term planning.

The Bank is organized in regions as follows:

AFR—Sub-Saharan Africa LCR—Latin America and the Caribbean

EAP—East Asia and the Pacific MNA—Middle East and North Africa

ECA—Europe and Central Asia SAR—South Asia

About the Cover:The crested wood partridge Rollulus roulroul is a common resident of lowland rain forestsin Sumatra and Borneo. These are now some of the most threatened forests on Earth—ithas been estimated that at present rates of clearance for agriculture and logging, alllowland forests in Sumatra will be cleared by 2005 and those in Kalimantan (IndonesianBorneo) will have vanished by 2010. The undisturbed rainforests have been vanishing atthe rate of 1.5 million hectares a year over the last 12 years. The partridge occurs withinthe Kerinci national park and adjacent forests, the site of a Bank/GEF integratedconservation and development project, which is strengthening park management andworking with local communities and forest concessions to maintain a permanent forestestate across a range of habitats from lowland forests to the peak of Sumatra’s highestmountain, Gunung Kerinci.

This year the crested wood partridge was chosen as the symbol for the JuneEnvironment Events at the World Bank to symbolize the linkages between healthy ecosystems,

biodiversity conservation, and sustainable development.

Photo: J. & K. MacKinnon

MAKINGSUSTAINABLECOMMITMENTS

2001

The WThe WThe WThe WThe World Bank�s neworld Bank�s neworld Bank�s neworld Bank�s neworld Bank�s newEnvironment StrategyEnvironment StrategyEnvironment StrategyEnvironment StrategyEnvironment Strategyis an integral paris an integral paris an integral paris an integral paris an integral par t of at of at of at of at of acomprehensive approachcomprehensive approachcomprehensive approachcomprehensive approachcomprehensive approachto development.to development.to development.to development.to development.

Letter from the Vice President, ESSD 1

VIEWPOINT, by Mohammed Valli Moosa 4South Africa�s Minister of Environment looks forward to the WorldSummit for Sustainable Development.

Making Sustainable Commitments 6 (see note above)

The World Bank�s Environment 10Strategy ConsultationsPreparing the Environment Strategy required extensive consulta-tions, both inside and outside the Bank.

From Strategy Preparation to Implementation 1212121212With the Bank�s Environment Strategy now completed, efforts haveto focus on implementation.

Focusing on Poverty and Environmental Links 14The Environment Strategy highlights three broad linkages betweenpoverty and the environment: health, livelihoods, and vulnerability tonatural disasters.

Protecting the Global Commons 18Protecting the global and regional commons is a key component ofthe World Bank�s Environment Strategy.

The Safeguard Policies at the Core of the 22Environment StrategyThe World Bank�s safeguard policies help integrate environmentaland social concerns into design and implementation of Bank-supported activities.

REGIONAL REVIEWS

One size does not fit all. Working in collaboration with our clientsand partners to identify the critical environmental issues that shouldbe addressed in specific circumstances is a central theme of theStrategy. This section summarizes the main elements of the regionalenvironment strategies.

Sub-Saharan Africa 24

East Asia & the Pacific 28

Europe & Central Asia 32

Latin America & the Caribbean 36

Middle East & North Africa 40

South Asia 44

Building a Sustainable Development Roadmap 48IFC�s Strategy to ensure environmental and social responsibility

News Updates 52Includes updates on Environment Week at the Bank, the KyotoProtocol�Implications from Bonn, the Nile Basin Initiative, CEPF,Rio+10 preparations, and Greening the Bank.

The Bank�s Environment Portfolio 56Over the last decade the World Bank�s activities in the environmentalarea have evolved from primarily stand-alone projects toward abroader portfolio.

Environment by the Numbers 60Selected indicators summarize the main environmental trends incountries throughout the world.

BACK OF THE BOOK

Environmental Publications 64

Mailing List (inside back cover)

4 ENVIRONMENT MATTERS • 2001

Where do we come fromNext year in Johannesburg, world leaders will re-visit the his-

toric issues raised at the 1992 Rio Earth Summit: sustainable

development and the protection of the environment as one el-

ement of sustainable development.

In the preamble to the 1992 Earth Summit, the context of the

world’s development constraints was embodied in the interac-

tion among the economy, social structures, and the environ-

ment. This context has not changed. We still live in a world

where the disparity between rich and poor constantly increases.

As custodians for future generations, we must ensure a safer,

more prosperous future in which we deal with environment

and development issues in a balanced manner.

In 1992, Heads of State and senior government officials of 178

countries got together

to chart the road ahead

for a global partnership

that would ensure that

all nations would have

a safer and more pros-

perous future. This

partnership included

the development of

Agenda 21; a statement

on the management,

conservation, and sus-

tainable development

of all forests; and formulation of the United Nations Frame-

work Convention on Climate Change and the Convention on

Biological Diversity.

The world departed from Rio with Agenda 21 as a mandate for

sustainable development. The underlying message of that man-

date was simple—without better care of the environment, de-

velopment will be undermined; and without accelerated

economic and social development of poor countries, environ-

mental policies will fail.

The vision for Johannesburg 2002In September 2002, we shall gather in Johannesburg for a ten-year review of the historic 1992 meeting. The 2002 United Na-tions World Summit on Sustainable Development (WSSD)should focus on the identification of accomplishments and ar-eas where further efforts are needed to implement Agenda 21and other outcomes from Rio. This summit must focus on ac-tion-oriented decisions to implement Agenda 21. TheJohannesburg meeting is an opportunity to find renewed po-litical commitment and support for sustainable development.

A central issue is to ensure a balance between economic devel-opment, social development, and environmental protection asindependent and mutually reinforcing components of sustain-able development.

This Summit should be based on a constructive partnershipbetween the developedand the developingworld, which recog-nizes our common butdifferentiated responsi-bilities for workingtoward sustainable de-velopment. It mustclearly address the in-ternational challengesto the creation of an en-abling environment.

It should deepen the global commitment to sustainable devel-opment through a new “global compact,” and bring a new spiritinto the environmental debate. Fortunately there is an emerg-ing consensus that the primary focus of the Summit should beon “poverty, development, and the environment.”

Some of the themes that are already emerging include theinterlinkages among poverty, environment, and development;financing mechanisms; technology transfer; trade and the en-vironment; water; energy; environmental health; and land

VIEWPOINT by Mohammed Valli Moosa,

Minister of Environmental Affairs and Tourism, South Africa

How sustainable is a world that promotes

strident and unabated development in some

parts of the world, yet perpetuates, and even

exacerbates, underdevelopment, poverty,

and disease in other parts of the world?

Johannesburg 2002Johannesburg 2002MUST BE ABOUT PEOPLE, PLANET, AND PROSPERITY

JULY 2000–JUNE 2001 • (FY2001) 5

South African Government’s Department of Environmental Affairs andTourism, Private Bag X447, Pretoria 0001, South Africa. 012-310-3611,(fax) 012-322-0082. Website — http://www.environment.gov.za/

— Mohammed Valli Moosa

degradation. These issues are key to thedeveloping world and paramount forthe strengthening of the broad state-ments declared in 1992.

What Africa expectsfrom JohannesburgAt Johannesburg, the world consensuson the real and practical meaning of sus-tainable development must take a quan-tum leap forward. Shall we dare to askthe question: How sustainable is a worldthat promotes strident and unabated de-velopment in some parts of the world,yet perpetuates, and even exacerbates,underdevelopment, poverty, and disease in other parts of the world?

At the recent session of the Governing Council of the UnitedNations Environment Programme in Nairobi, elementsemerged that could guide discussions on governance and in-stitutional arrangements, including defining workable institu-tional arrangements; addressing finances, including lookinginto the decisionmaking of international financial institutions;and instituting a system that empowers small and developingcountries to participate meaningfully.

The Johannesburg Summit must not shirk the responsibility ofcritically assessing our successes and failures in implementingthe Rio decisions. There is still time to complete unfulfilledtasks. The time between now and the 2002 Earth Summit isvaluable time. Johannesburg must be more than just about look-ing back.

The WSSD and AfricaThe people of Africa, and indeed the world, will look upon thisgreat gathering of world leaders and want them to chart a pathforward with courage and determination. Such a path mustprovide hope:� To the millions who suffer from waterborne diseases

� To the children who suffer as a result of underdevelopment� To the women whose emancipation will continue to elude

us as long as they carry the burden of daily scavenging forsources of energy and clean water.

The Summit must have prominently on its agenda questions

of health, water, energy, and a better life for children and the

emancipation of women.

The impact of the loss of biodiversityon the poor, particularly as it relatesto the invasion of exotic species anddestruction of sources of food in thelakes of Africa, must be addressed.

We are talking about the intersectionbetween environment, poverty, anddevelopment. This intersection con-stitutes the core subject matter of theSummit.

There has been much discussion overthe past years on the question of en-vironmental governance. We will becowards if our discourse on this mat-ter is half measured and fails to ad-

dress the real issues. The noble decisions of Rio, and those thatemerge from Johannesburg, will be unfulfilled without work-able and democratic institutional arrangements to effect imple-mentation.

We need to develop a new system that can empower small anddeveloping countries to participate meaningfully in matters ofenvironmental governance. The present proliferation of struc-tures, agreements, programs, and conferences simply resultsin an inadequate participation on the part of developing coun-tries. The dispersed and fragmented nature of the system makesit fundamentally undemocratic. To succeed in implementingthe agenda for global change, environmental governance pro-cesses need to be transparent. There is a very small body ofpeople in this world who really and truly understand all ofthese processes and the large variety of acronyms that go alongwith it.

There is no point in having wonderful arrangements withoutadequate finances and resources, and we need to get that right.Hopefully, we will tackle these issues before we get toJohannesburg. The journey to Johannesburg is as important asthe Summit itself. Let us commit ourselves here to complete allthat needs to be done in our own national preparatory pro-cesses, including popular mobilization for sustainable devel-opment. Without popular mobilization, we will not havesustainable development.


We live in a timeof both aston-ishing progressand appallingdes t ruc t ion .

Economic development and the abil-

ity to connect around the globe have

led to dramatic improvements in

people’s quality of life. New growth

opportunities have produced gains

unparalleled in human history. But

these gains have been unevenly dis-

tributed. A large part of the world’s

population remains desperately poor,and we are often witness to devastationcaused by man and nature.

Challenging timesWe continue to struggle with environ-mental threats. Despite significantprogress, many damaging environmen-tal trends have not been fully arrestedor reversed, thus jeopardizing the live-lihoods and development prospects ofbillions. The statistics are familiar: 2 bil-

lion more people on the planet over thenext quarter of a century; nearly twothirds of the world’s population livingin water-scarce or water-stressed areasby 2025; the need to double food pro-duction over the next 40 years at a timewhen almost 23 percent of the world’sagricultural land has been degraded; theloss of more than 9 million hectares offorest a year, putting at risk more than1.6 billion people who depend onforests for their livelihoods; the over-exploitation and decline of more than 60percent of the world’s marine fisheries—

C. C

arne

mar

k

by Kristalina I. Georgieva, Director, Environment Department

An Environment Strategy for the World Bank

JULY 2000–JUNE 2001 • (FY2001) 7

threatening the livelihoods of fishermen,95 percent of whom live in the develop-ing world; and the possible disappear-ance of small island nations because ofrising sea levels due to climate change.

Environmental degradation is of in-creasing concern to both citizens andgovernments in many of the WorldBank’s client countries. In some coun-tries, annual losses of productivity andnatural capital run as high as 4–8 per-cent of GDP. That is without the antici-pated impacts of climate change, whichthreaten to undermine long-term devel-opment and the ability of hundreds ofmillions of people in the developingworld to escape poverty. The Intergov-ernmental Panel on Climate Change es-timates that the steady warming of theEarth’s surface temperature will lead tofalling agricultural production in tropi-cal and sub-tropical countries, especiallyin Sub-Saharan Africa.

The combination of resource depletionand population growth places thesustainability of development at risk ina large number of the poorest countries.The “genuine” savings rate—the changein the total wealth of a country, factor-ing in natural, human, and producedcapital—is negative in nearly 30 coun-tries, while wealth per capita is declin-ing in another 20. This implies that theasset base underpinning development isbeing eroded in these countries, withconsequences for social welfare now andin the future.

Poor people are particularly underthreat. One-and-a-half billion of themstill do not have access to safe drinkingwater, nor to adequate sanitary facilities.This, along with air pollution and vec-tor-borne diseases, is causing nearly 20percent of the mortality and morbidityin the developing world.

A strategy for thefutureDevelopment organizations like theWorld Bank are facing these challengeswith a renewed commitment to supportthe efforts of developing countries toaddress them. Our experience hastaught us that environment is also a pov-erty and a development issue, and in-herently relevant to poor people’s hopesfor a better life. Two things are indisput-able in today’s world: The reduction ofpoverty is critical to the quest for a sus-tainable future, and environmentalsustainability is intrinsic to povertyreduction.

Earlier this year, the Bank introduced anew Environment Strategy as an inte-gral part of a comprehensive approachto development. Central to the Strategyis the understanding that if we wantdevelopment to succeed, environmentcannot be an afterthought—it must beconsidered early and often in develop-ment planning.

The new Environment Strategy outlineshow the World Bank will work togetherwith its client countries to address theirenvironmental challenges and ensurethat Bank projects and programs inte-grate principles of environmental sus-tainability. The Strategy sets a vision,objectives, and a course of action for thelonger term and suggests specific ac-tions, targets, and institutional measuresfor the next five years. It is the productof a multiyear effort, including an ex-tensive evaluation of the Bank’s pastperformance, and numerous workshopsand consultations with client govern-ments, civil society, academia, multilat-eral and bilateral development agencies,and representatives of the private sec-tor. The consultations played an impor-tant role in shaping the final document.

The Bank is profoundly grateful to allthose who took the time and trouble tocontribute to the process.

The Strategy places emphasis on devel-oping country priorities, spelling outthree objectives:

� Improving the quality of life—people’shealth, livelihood, and vulnerabil-ity—affected by environmental con-ditions

� Improving the quality of growth—bysupporting policy, regulatory, andinstitutional frameworks for sustain-able environmental management andby promoting sustainable privatedevelopment

� Protecting the quality of the regional andglobal commons—by dealing with cli-mate change, forests, water resources,and biodiversity.

These three elements make up the ho-listic approach the World Bank is pur-suing in order to link environment anddevelopment, on both the local andglobal levels. Let me use two examplesto demonstrate what this means inpractice.

The first is about one of the regional andsub-regional initiatives supported by theWorld Bank. For countless generations,the Nile River has sustained the hopesand dreams and lives of millions ofpeople living along its banks. Now,many of the Nile Basin countries aresharing a common vision of harnessingthe full potential of regional cooperationthrough the Nile Basin Initiative (seeNewsUpdates, page 53).

The riverine states—Ethiopia, Sudan,Eritrea, Egypt, Burundi, Rwanda, Tan-zania, Democratic Republic of theCongo, Uganda, and Kenya—are seek-ing to develop the water resources of theNile Basin in a sustainable and equitable


way. The range of development projectswill vary according to country needs,but will include water supply and sani-tation, fisheries development, and sus-tainable management of wetlands andbiodiversity conservation. Further, theywill include joint health and environ-ment activities, such as the control ofmalaria and other endemic diseases;protection of wildlife; environmentalmanagement; and disaster forecastingand management.

The second example comes from thecoldest capital of the world, the city ofUlaanbaatar in Mongolia, where resi-dents mainly use traditional coal stovesfor cooking and to heat their felt tents(gers) and homes. More than 70,000 in-efficient coal stoves produce high levelsof air pollution—both indoors and out-doors—especially during the bitterlycold and long winter months when thesmoke hovers over towns. This pollu-tion accounts for half of the country’s

child deaths and a major part of childand adult morbidity. It also contributesto Mongolia’s greenhouse gas emis-

sions—one of the highest in the world

per capita and per unit of GDP.

To address this problem, the World Bank

used a grant from the Global Environ-

ment Facility to develop, with the help

of local and international experts, a

small project to produce low-cost “kits”

for insertion into the normal stoves. The

kits improve the stove’s efficiency, re-

duce indoor and outdoor air pollution,

and also cut down CO2 emissions by 54

percent. Many low-income consumers,

about two thirds of the population in the

ger area, will benefit from these im-

provements in terms of fuel cost and

health impacts (see Photo, below).

The Mongolia story is just one of count-

less such activities all over the world,

where the World Bank is working with

client countries to link local and global

environmental concerns and to make the

connections between environment and

development.

R. M

assé

F. Do

bbs

For countless generations, the Nile River has sustained the hopes, dreams, and lives of millions of peopleliving along its banks. Cairo, Egypt.

To help address Mongolia’s greenhouse gas emissions the World Bank used a grant from the GlobalEnvironment Facility to develop, with the help of local and international experts, a small project to producelow-cost “kits” for insertion into traditional coal stoves. The kits improve the stove’s efficiency, reduce indoorand outdoor air pollution, and also cut down CO2 emissions by 54 percent.

JULY 2000–JUNE 2001 • (FY2001) 9

Sustainable management of environ-ment and natural resources require ef-fective government policies, regulations,and institutional frameworks. The newstrategy calls for support to strengthenthe regulatory and enforcement capac-ity of client governments, and also formarkets that work for the environment,not against it. New solutions must befound to address complex problems.

One of the innovations the strategy pro-motes is about correcting the failure ofthe market to recognize valuable ecosys-tem services. For example, many of theecosystem services that forests pro-vide—from timber to climate regulationto water supply to recreation— are notaccounted for in decisionmaking be-

ducing the ecological footprint of itsphysical facilities; setting benchmarksfor its social and environmental perfor-mance, and reporting on progress withindependent verification; and greeningits procurement practices.

Working together tomake a differenceNow, more than ever, it is imperativethat the World Bank help forge a senseof community and common interestboth within the Bank and with partnersand potential partners in client coun-tries, other multilateral organizations,donor countries, nongovernmental or-ganizations, and the private sector. Nei-ther the Bank nor any other institutionor even country can by itself reach thedevelopment goals needed to reducepoverty. Some partnerships already ex-ist (see Box). Others are yet to be forged.

The World Summit on Sustainable De-velopment to be held in Johannesburgin September 2002 will be an opportu-nity, not just for the World Bank but forthe whole world, to demonstrate that thepower of partnership is alive and well,and working for the common good. Iecho the words of South Africa’s Envi-ronment Minister Mohammed ValliMoosa, “This Summit should be based ona constructive partnership between the de-veloped and the developing world, whichrecognizes our common but differentiatedresponsibilities for working toward sustain-able development.”

Such partnerships and sense of commu-nity at all levels are critical if we are tohelp build an equitable, sustainable,and peaceful world. Now, more thanever, it’s important for all of us—bothindividually and collectively—to be-lieve that we can be a force for good.

— Kristalina Georgieva

cause they do not enter into markets. Tohelp alleviate this problem, the WorldBank is working with several clients todevelop systems of payments for envi-ronmental services that would help sub-stitute for these missing markets. Asystem is already in place in Costa Rica,and work is under way in several othercountries.

The World Bank is also answering thechallenge to put social and “green” re-sponsibility on the corporate agenda.Part of the strategy for the future is totransform the World Bank into a globalleader on social and environmental re-sponsibility. The Bank will focus onbeing a good citizen for the local envi-ronment and community we live in; re-

� As an implementing agency with the United Nations Development Programand United Nations Environment Program of the Global EnvironmentFacility (GEF), the Bank is supporting projects in four key areas:biodiversity conservation; addressing climate change; the phaseout ofozone-depleting substances; and the protection of international waters.

� As an implementing agency for the Montreal Protocol’s Multilateral Fund,the Bank supports programs in 20 countries and has committed $445million since 1991 for over 558 projects to help enterprises convert to ozonefriendly technologies.

� The World Bank/WWF Alliance for Forest Conservation and SustainableUse, in which the Bank has invested close to $2 million, calls for 50 millionhectares (124 million acres) of highly threatened forest area around theworld to be protected by 2005 (www-esd.worldbank.org/wwf).

� The CEO Forum on Forests—chaired by President Wolfensohn and theWorld Bank/WWF Alliance—is a private sector/civil society dialogueprocess for improved forest management and forest conservation.

� The World Bank, Conservation International, the GEF, and the MacArthurFoundation are partners in the Critical Ecosystem Partnership Fund (CEPF)to better safeguard developing countries’ biodiversity hotspots—highlythreatened regions where some 60 percent of all terrestrial species diversityare found on only 1.4 percent of the planet’s total surface area(www.cepf.net).

� The World Bank partners with governments and private companies for thePrototype Carbon Fund (PCF)—a $145 million fund created by the Bank todevelop real-world experience on how carbon markets and trading couldoperate in developing countries and in countries with economies in transi-tion (www.PrototypeCarbonFund.org).

Building a Sense of Community Worldwide —Bank Partnerships on the Environment

ENVIRONMENT MATTERS • 200110

In April 1999, the WorldBank Group embarked ona comprehensive effort to

develop an environment strat-egy to enhance the Bank’s ef-fectiveness in addressingenvironmental challenges in itsclient countries. As part of thiseffort, the World Bank soughtto learn more about our part-ners’ views about how best tolink environmental protectionwith development assistance;how they view their environ-mental partnerships with theBank; and how they view theBank’s overall effectiveness inproviding environmental as-sistance.

The consultationprocessIn early May 2000, the WorldBank initiated a broad-basedconsultation on the emergingEnvironment Strategy, using aprogress report and six draftregional environment strate-gies as the basis for discussion.The consultation consisted ofworkshops with client and do-nor countries, including repre-sentatives of government, civilsociety, the private sector, andacademia; a dialogue with sev-eral of our multilateral and bi-lateral partners; meetings withinternational nongovernmen-tal organizations (NGOs); anda broad-based information dis-semination and feedback pro-cess through e-mail and theInternet.

Between May 2000 and June2001, over 30 formal and infor-mal meetings or working ses-sions took place in each of the

Bank’s client regions, as well asin Japan, North America, andWestern Europe (see map). Inaddition, a dedicated Environ-ment Strategy Consultationlink on the World Bank Web-site provided access to theprogress report, backgroundpapers, schedules, updates,links to open discussion fo-rums, e-mail contacts, and aquestionnaire. Between Au-gust 2000 and the end of Janu-ary 2001, this website receivednearly 35,000 download re-quests for papers, and morethan 2,000 people from 98countries registered and com-mented through the site.

The reports of the consultationmeetings and outcomes in thesix client regions, North Amer-ica, Japan, and Western Europecan be found on the Environ-ment Department website,along with background pa-pers, and the text of the Envi-ronment Strategy, which wassubmitted to the World BankBoard of Executive Directors inJuly 2001.

The impact of theconsultations on thestrategyThe value of the consultationswas inestimable. They provid-ed a forum for face-to-face dis-cussions, promoted greaterdissemination of informationabout the issues, and have ledto a better understandingamong the participants of ourmutual concerns. There was aconsensus across the regionsthat the environmental issues

heTWorld Bank�sEnvironment

StrategyConsultations

JULY 2000–JUNE 2001 • (FY2001) 11

we are confronting worldwideare urgent and that this urgen-cy must visibly inform thework of the Bank and the textof its Environment Strategy.

In general, most of the consul-tation participants agreed thatenvironmental objectivesshould be systematicallylinked with developmentgoals, particularly poverty re-duction, as the sustainable useof natural resources is funda-mental to the long-term suc-cess of those goals. Participantsrequested that the Bank ac-knowledge and strengthen itsleading position as a globalrole model, facilitator, and cat-alyst, and recognize its respon-sibility to set high internationalbenchmarks for good environ-mental practice. In addition,some urged the Bank to lobbyindustrial countries to improvetheir own environmental per-formance and to make largerfinancial commitments to aiddeveloping nations in their ef-forts to build up sound envi-ronmental management. Therewas a general call in the con-sultations for the World Bankto make changes within itsown operations in several crit-ical areas. For example, theBank should:

! Mandate a longer time-frame for policy analysis,planning, and assistanceprograms, so that the long-term impacts of develop-ment decisions on thesocial and physical en-vironment can be betterreflected in the design ofits actions.

! Support Strategic Environ-mental Assessments andother in-depth, cross-sectoral environmentalanalyses early in country-policy dialogues, so thatthe complex, positive andnegative synergies amongdevelopment goals andactivities may be capturedor mitigated.

! Support increased trans-parency and accounta-bility on the part of bothborrowers and the WorldBank by instituting regu-lar reporting to externalstakeholders, using clearbenchmarks or perfor-mance indicators.

In direct response to the con-cerns the World Bank teamheard expressed during theconsultations, the Environ-ment Strategy emphasizes thatour environmental challengesmust be tackled within the sus-tainable development frame-work. Development goals andkey areas of assistance are char-acterized by three major objec-tives: quality of life, quality ofgrowth, and quality of the re-gional and global commons.The Strategy’s action plan hascommitted the Bank to the fol-lowing implementation activ-ities:

! Environmental analysiswill occur earlier in thepolicy dialogue; cross-sectoral analysis will bestrengthened; and stra-tegic environmental assess-ments and country en-vironment profiles will be

applied systematically tohelp integrate longer-termspatial, ecological, andsocial concerns.

! The World Bank willemphasize in-countrycapacity building whilecarrying out project-levelenvironmental assess-ments, strategic enviro-nmental assessments, andin the participatory pro-cesses related to initiativessuch as Country Assis-tance Strategies and Po-verty Reduction StrategyPapers.

! As part of their analyticalwork, World Bank staffwill support the linkagesamong local and regional/global concerns by iden-tifying the overlaps be-tween environmentalgoals at the local, regional,and global levels.

! The World Bank willsupport greater trans-parency regarding itsenvironmental perfor-mance by developing and

This article was prepared by JudithMoore of the Environment Depart-ment, (202) 458-9301, fax (202) 522-1735.

disseminating environ-mental and sustainabilityindicators for client coun-tries, and by establishingan Environmental Perfor-mance Reporting unitwithin the EnvironmentDepartment for the pur-pose of reporting perfor-mance based on clearbenchmarks.

The Environment StrategyConsultation—and the Strate-gy, itself—is an ongoing pro-cess. In particular, it does notintend to cut short the globaldebate under way on develop-ment directions. The dialoguewith all of our developmentpartners will continue, and theStrategy will be revisited, eval-uated, and adjusted.

North AmericaNorth America

Latin America/Latin America/

CaribbeanCaribbean

WesternWestern

EuropeEuropeEurope

EasternEastern

Europe/Europe/

Central AsiaCentral Asia

South AsiaSouth Asia

MiddleMiddle

East/ NorthEast/ NorthEast/ NorthEast/ North

AfricaAfrica

SubSub--

SaharanSaharan

AfricaAfrica

EastEast

Asia/Asia/

PacificPacific

Formal and informal consultations on the Environ-ment Strategy were conducted worldwide


The preparation of theBank’s EnvironmentStrategy led to a fruit-

ful intellectual dialogue withcolleagues in the Bank, clients,partners, and critics. It ener-gized the Bank’s environmentcommunity, reinforced man-agement commitment to envi-ronmental sustainability, andstrengthened cross-sectoraland cross-institutional dia-logue and cooperation on en-vironmental issues. Ourconsultations brought togeth-er diverse stakeholders, in-formed them about the Bank’sagenda and objectives, andstrengthened partnershipsaround common objectives.This process does not end withpublishing the Strategy paper.Now we have to focus our en-ergy on implementation.

A gradual shiftThere is no clear dividing linebetween preparation and im-plementation. Even before theStrategy was completed, theintellectual debate and emerg-ing strategic priorities startedto influence project design andled to new programs. Follow-ing the strengthened focus onpoverty-environment linkag-es, for example, we initiated apilot program to integrate en-vironment into Poverty Reduc-tion Strategy Papers (PRSPs)(see Box, at left).

We also have to recognize thatimplementing the Strategy willbe a gradual process. We needto align our incentives, skillsmix, resources, and partner-ships to accelerate the shiftfrom viewing the environmentas a separate, freestanding con-cern to considering it as an in-

tegral part of our developmentassistance. We then need to putthis understanding into prac-tice in our analytical work, pol-icy dialogue, and projectdesign.

Strengthening ourinternal incentivesTo make a substantial and last-ing difference, we must ensurethat environmental issues arenot just the concern of a small,specialized group, but are ful-ly internalized into all Bankactivities. The Strategy calls fora client-centered accountabili-ty framework, emphasizingthat our core responsibility isto support sustainable devel-opment in our client countries.

Within the Bank, we need tomaintain clear lines of respon-sibility and a consistent set ofincentives that support theimplementation of the Strate-gy. This includes incentives forworking across sectors and dis-ciplines. As an example of ef-forts to recognize goodperformance in this area, thefirst “green awards” werelaunched in June 2001 (see Box,top of next page).

“Green awards” are only partof a larger set of incentivesunderpinned by managementcommitment to improve ourenvironmental performance.Other elements include sys-tematic reviews and feedbackto senior management on theenvironmental aspects ofcountry assistance strategies(CASs), projects, and pro-grams; and staff performanceevaluations linked to key ob-jectives of the Strategy.

rom StrategyFPreparation to

Implementation

INTEGRATING ENVIRONMENT INTO

POVERTY REDUCTION STRATEGY

PAPERS (PRSPS)As of September 1999, all low-income coun-tries use participatory processes to preparePRSPs to obtain debt relief or concessionallending from the International DevelopmentAssociation. Building on the analytical basedeveloped during Strategy preparation, theBank has launched a pilot program to assistclient countries in integrating environmentalissues into their PRSPs.

The program takes a three-pronged ap-proach:

1. Analytical work in pilot studies defines thepoverty-environment linkages

2. Training on environment-poverty issuesand cross-sectoral linkages in pilot coun-tries equips decisionmakers with theknowledge and analytical skills to designeffective interventions

3. Systematic reviews assess the environ-mental aspects and sustainability ofPRSPs.

The first reviews indicate considerable vari-ation across countries in the degree of envi-ronmental mainstreaming. They identifyseveral good practices, and suggest areasfor future improvement.

JULY 2000–JUNE 2001 • (FY2001) 13

Adjusting our skillsEnvironmental issues are in-herently cross-sectoral. Theneed to integrate work on en-vironment with other sectors isa key theme of the Strategy.The increasing focus on cross-sectoral work and the shift inemphasis from project-levelsafeguards toward integratedportfolio-level risk assessmentand quality enhancement re-quires a gradual shift in staffskills. We also need to prepareto adjust to a changing globalcontext, new development is-sues, and to the Bank’s chang-ing lending profile.

Training will be an importantpart of adjusting our skills. Acomprehensive learning pro-gram is being developed thatwill focus on the priority areasidentified by the Strategy: pov-erty-environment linkages,vulnerability to environmentalchange, environmental policyand compliance, environmen-tal health, and natural resourcemanagement. New learningactivities will focus on strate-gic environmental assessment(SEA) and country environ-

mental diagnostics. Particulareffort will go to safeguardstraining to familiarize Bankstaff and managers with theobjectives and rationale of safe-guard policies in order to im-prove compliance and de-velopment impact.

Integrating environmental as-pects into country and sectorprograms and projects, andshifting accountability for en-vironmental performance be-yond the environment sector,require a cultural and institu-tional change. We will supportthis shift by joint appointmentsand work programs with oth-er sectors, staff rotation, sec-ondments with other sectorsand partner institutions, andstrategic human resource man-agement.

Realigning ourresources andpartnershipsWe are realigning budget allo-cations in response to chang-ing work program priorities.But achieving the Strategy’sobjectives also requires addi-

tional resources. This was rec-ognized by the Bank’s manage-ment when it approved budgetincreases in two key areas: (1)improving the safeguard andcompliance system; and (2)supporting the mainstreamingof environmental issues intoBank operations, with specialfocus on CASs, PRSPs, cross-sectoral and cross-institution-al programs, and regional andsub-regional environmentalactivities.

No single public agency hasthe legitimacy, credibility, andfinancial and organizationalcapacity to influence decisive-ly all major development is-sues alone. Partnerships withother development institu-tions, civil society, and the pri-vate sector can be importantcontributors to common objec-tives. We will continue ourconstructive partnerships inthe framework of the GlobalEnvironment Facility (GEF),the Multilateral Fund for theMontreal Protocol (MFMP),the Prototype Carbon Fund(PCF), and others to help im-plement major internationalconventions and facilitate fi-nancial transfers to client coun-tries. We are engaged innumerous other partnershipsin a range of areas. During thecoming years, we will system-atically review and align ourpartnerships to support the ef-fective implementation of theStrategy.

Monitoring progressOur ultimate goals are longterm. To ensure that we are onthe right track, we need to setbenchmarks, monitor pro-gress, learn from successes andfailures, and adjust our pro-

GREEN AWARDS REWARD

ENVIRONMENTAL EXCELLENCE

In June 2001, the World Bank awarded the first annual “GreenAwards” to project directors and project teams across the Bankwho have been promoting the mainstreaming of environmentinto their operations.

Awards were given in two categories: country director and taskteam. In the country director category, awards were given toJames W. Adams (Tanzania and Uganda), Olivier Lafourcade(Mexico), Andrew N. Vorkink (South Central Europe CountryUnit), and Mark Baird (Indonesia).

In the task team category, the winners were the Bolivia/BrazilGas Pipeline Project, the MNSID Water Team, the India Ener-gy Team, the Panama Land Administration Project, and thePoland Coal Restructuring Project.

grams. Our Strategy puts spe-cial emphasis on enhancingour performance monitoringand reporting framework (seeBox, below). We will use the In-ternet and other means of com-munication with key stake-holders to make available re-ports and information aboutthe Bank’s environmental per-formance, discuss issues, andreceive feedback.

BENCHMARKS FOR

MONITORING BANK

PERFORMANCE IN

STRATEGY

IMPLEMENTATION

! Country diagnostic stud-ies carried out to assessenvironmental prioritiesand management capac-ity to inform CASs andPRSPs in 5–15 prioritycountries annually. Levelof environmental main-streaming in CASs im-proved.

! Targeted environmentalinput (analytical work andtraining) in 5–15 priorityPRSP countries annually.

! Structured learning onSEAs based on 10–20SEAs carried out annual-ly to inform sectorprojects and programs.Level of mainstreaming inkey sectors improved.

! Systematic client trainingdelivering 20,000–25,000“participant training days”annually.

! Improved safeguard com-pliance indicators.

! Ninety percent of all op-erational Bank staff andmanagers trained in en-vironmental safeguardsby 2006.

This article was prepared by MagdaLovei of the Environment Depart-ment, (202) 473-3986, fax (202) 522-1735.


P overty is not just a mat-ter of low income. It isalso a question of the

poor having few economic op-portunities, of insecurity in theface of financial and otherrisks, and of lack of voice orempowerment. The WorldBank Environment Strategyemploys this broader conceptof poverty in order to high-light, in addition to the ques-tion of empowerment, threebroad linkages between pover-ty and the environment:health, livelihoods, and vul-nerability to natural disasters.

Environment and poverty arelinked by a multiplicity of po-tential pathways (see Figure,below). While these linkagesare in reality multi-dimension-al and involve feedback mech-anisms, the main tendenciescan be seen in this Figure. Thequality of the natural resource

base affects livelihoods, partic-ularly in rural areas. The healthof poor households is heavilyinfluenced by access to waterand sanitation, as well as ex-posure to indoor and outdoorair pollution. Poor householdsare often the most exposed tonatural disaster risks, partlylinked to the fragility of near-by ecological systems. Lack ofproperty rights and access toinformation limits the ability ofthe poor to participate in deci-sions affecting their welfare.

This broader notion of pover-ty and of poverty-environmentlinks is beginning to be em-ployed by World Bank clientsin the preparation of PovertyReduction Strategy Papers(PRSPs). Initially required as acondition for debt relief, thePRSP will become a key docu-ment in determining Bank as-sistance to all low-income

ocusing onFPoverty and

EvironmentalLinks

Environmental dimensions of poverty

Rural and urbanlivelihoods

Health

environmentalVulnerability to

change

Participation indecisionmaking

Examples of

environmental

determinantsDimensions

of povertyElements of

well-being

Natural resourcebase

Access to waterand sanitation

Air quality

Ecological fragility

Likelihood ofnatural disasters

Opportunity

Security

Empowerment

Property rights

Access to environ-mental information

JULY 2000–JUNE 2001 • (FY2001) 15

(IDA) countries as of July 2002(see Box, above).

Environmentalhealth and povertyRecent estimates suggest that

premature death and illness

due to major environmental

health risks account for one

fifth of the total burden of dis-

ease in the developing world—

comparable to malnutrition

and larger than any other pre-

ventable risk factors and

groups of disease causes. The

contribution of environmental

risks to the total burden of dis-ease is 10 times larger in poorcountries than it is in rich coun-tries (see Figure, at right).

Environmental health risks fallinto two broad categories. Tra-ditional hazards, related topoverty and lack of develop-ment, include lack of safe wa-ter, inadequate sanitation andwaste disposal, indoor air pol-lution, and vector-borne dis-eases such as malaria. Theserisks affect developing coun-tries the most. Modern hazardscaused by development with-out environmental safeguards

and other exposure to agro-in-dustrial chemicals and waste.

Worldwide, an estimated 3million people in developingcountries die every year fromwater-related diseases causedby exposure to microbiologicalpathogens resulting from inad-equate sanitation and wastedisposal, inadequate watersupply for personal hygiene,exposure to unsafe drinkingwater, and bacteriological con-tamination through a varietyof other water uses, such ascooking and bathing. The ma-jority of fatalities are childrenunder age 5. Water-related dis-eases impose an especiallylarge health burden in the Af-rica, Asia, and Pacific regions.In India alone, nearly 1 millionpeople die annually as a resultof water-related diseases.

More than half of the world’shouseholds use unprocessedsolid fuels, particularly biom-ass (wood, crop residues, anddung) for cooking and heating,often in inefficient stoves with-

SOURCEBOOK FOR POVERTY REDUCTION

STRATEGY PAPERS (PRSPS)Poverty Reduction Strategy Papers provide the basis for assistance from the Bank and the IMFand for debt relief under the Highly Indebted Poor Country (HIPC) initiative. PRSPs are intendedto be country-driven, comprehensive in scope, partnership-oriented, and participatory.

The PRSP Sourcebook was designed to assist countries to develop and strengthen their povertyreduction strategies. It is meant to be used selectively as a resource to provide information aboutpossible approaches. The book covers core techniques, including poverty measurement andanalysis, cross-cutting issues such as gender and environment, and a full range of macroeco-nomic and sectoral issues.

The Environment chapter begins with an overview of the ways in which environmental conditionscan contribute to different aspects of poverty. It then outlines an approach to analyzing these linksin order to define priorities both between sectors and within the environmental domain—this isbroken down into understanding the links, choosing targets for improvement, choosing the mosteffective public action, and monitoring and evaluation of the actions implemented. Next, the chaptersummarizes an approach to “mainstreaming” of environment in PRSPs that has been developedwithin the World Bank. It also provides summary lessons from a systematic review of 25 interimand full PRSPs. To field test many of the ideas in the environment chapter, two workshops on“Mainstreaming Environment in PRSPs” were held in Nairobi and Johannesburg in February andMarch 2001. These workshops, organized in partnership with DFID, aimed to contribute to inte-grating environmental issues and opportunities in PRSPs and their underlying processes. At theJohannesburg meeting, participants came from Lesotho, Malawi, Mozambique, and Zambia; atthe Nairobi meeting, participants came from Ethiopia, Kenya, Tanzania, and Uganda. Donorsfrom the EU and the Netherlands were also represented. Similar workshops are planned for WestAfrica.

In Europe and Central Asia, support for the PRSP process was provided to the governments ofAlbania, Azerbaijan, and Georgia, with work upcoming in Bosnia and Herzogovina, Tajikistan,and the Kyrgyz Republic. Two successful workshops were held in Albania and Azerbaijan todiscuss the macroeconomic and sectoral linkages between the main components of the PRSPstrategy and the environment. As a result, the environment is being mainstreamed in the PRSPprocess, with working groups taking more account of the important linkages. This work was sup-ported by grants from DFID. In Georgia, the regional environment unit is working closely with thegovernment on PRSP preparation, with the assistance of Austrian trust funds.

include urban (outdoor) airpollution and occupational

The environmental contribution to the burdenof disease is highest in developing countries

Note: Disability-Adjusted Life Years (DALYs) are a measure of the burden of dis-ease. They reflect the total amount of healthy life lost, to all causes, whetherfrom premature mortality or from some degree of disability during a period oftime.

DA

LYs

per

mill

ion

peo

ple

(tho

usa

nd

s)

0

100

200

300

Developingcountries

Developedcountries

Other causes Environmental factors


out proper ventilation. Theoutcome is that people—main-ly poor women and children inrural areas and urban slums—are exposed to high levels ofindoor air pollution. It is esti-mated that nearly 2 millionchildren and women die everyyear in developing countries asa result. About half of thesedeaths occur in India and Chi-na.

Vector-borne diseases are af-fected by a range of environ-mental conditions and factors,including inadequate drainagefrom drinking water and fromirrigation; polluted and stand-ing water; clogged stormdrains; floods; and open sew-ers and certain types of sanita-tion. In Africa alone, malaria is

responsible for about 800,000deaths annually.

Natural resourcesand the livelihoodsof poor householdsResearch shows that links be-tween the natural environmentand the livelihoods of the poorcan be very strong, althoughthe precise nature and direc-tion of the links can vary sub-stantially from case to case.Poor rural households oftenderive a significant share oftheir incomes from natural re-sources. A study of 29 villagesin southern Zimbabwe showsthat environmental resourcesaccount for more than 30 per-cent of average total householdincome, and the poorer thehousehold, the greater theshare of income from environ-mental resources (see Figure, atright). However, even thoughthe poor are more resource de-pendent, they generally useless of these resources than thebetter-off. The poorest house-holds use three to four timesless in quantity terms than therichest. This illustrates two keypoints: first, that the poorestare most vulnerable to re-source degradation in relativeterms; but second, that pres-sure on natural resources willnot automatically be alleviat-ed when income rises.

Poor rural women in develop-ing countries tend to be dispro-portionately affected by thedegradation of natural resourc-es because they tend to be pri-

wood appears to harm manywomen’s health.

Poverty and naturaldisastersPoor people are also dispropor-tionately vulnerable to naturaldisasters, because they tend tolack access to secure housingand to live on marginal landmore prone to the effects ofdroughts, floods, or landslides.With few savings, the poor alsoare much more vulnerable toconsumption shortfalls intimes of crisis.

The vulnerability of the poorto natural disasters is com-pounded by the generallyweak capacity of government

Source: Cavendish, W. 1998. �The Complexity of the Commons: EnvironmentalResource Demands in Rural Zimbabwe.� WPS/99-8, May 1998. Oxford Univer-sity: Centre for the Study of African Economies (processed).

Zimbabwe � Poorer households obtain agreater share of their income from environ-mental resources

0

10

20

30

40

50

60

70

80

90

100

Q1 Q2 Q3 Q4 Q5

Income quintile

Per

cent

age

ofin

com

e

Total environmental income

Total own produced goods

Total net gifts/transfers

Total cash income(excluding environmental cash income)

marily involved in the collec-tion of fuel, fodder, and water.Depending on the availabilityof biomass resources, collec-tion of fuel and fodder maytake anywhere from 2 to 9hours. In Lombok, Indonesia,and in some areas of Kenya, forexample, women spend 7hours each day on cooking andon collecting dead wood or ag-ricultural residues as fuel. Be-cause of deforestation, theymay have to walk longer dis-tances and spend more timeand energy to collect fuel-wood. This reduces time spenton income-generating activi-ties, crop production, andhousehold and child-rearingresponsibilities. In addition,carrying heavy loads of fuel-

C. Ca

rnem

ark

— Bhutan

JULY 1999–JUNE 2000 • (FY2000) 17

This article was prepared by KirkHamilton of the Environment De-partment, (202) 473-2053, fax (202)522-1735, Julia Bucknall of Europeand Central Asia’s Environmentallyand Socially Sustainable Develop-ment Sector Unit, (202) 473-5323,fax (202) 522-1164, and Jan Bojö ofthe Africa Technical Families: Envi-ronment and Social DevelopmentUnit, (202) 473-4429, fax (202) 473-8185.

agencies to predict and re-spond to disasters and by thelack of social safety nets thatwould protect the incomes andconsumption of the poor dur-ing and after disasters. In thePhilippines, for example, theextreme weather associatedwith El Niño caused a greateroverall increase in povertythan the financial crisis. The ElNiño shock was regressive, inthat it increased inequality.

When ecosystems collapse, thesocial systems built to manage

and use them come underthreat. This can lead to con-flicts, particularly over envi-ronmental resources such aswater and fisheries.

Looking forwardThe Environment Strategy out-lines a broad approach to deal-ing with the challenges ofpoverty and environment. Partof the response entails empha-sizing poverty-environmentlinks in analytical work and inCountry Assistance Strategies,

and equipping our clients todeal with poverty-environ-ment links as they preparePRSPs. Operational responsesat the level of projects and non-lending services will include:

! Identifying cost-effectivemeasures to reduce envi-ronmental health risksthrough a range of sectorinvestments, includingwater and sanitation,energy, transport, agri-culture, and health.

C. Ca

rnem

ark

— Ghana

! Enhancing livelihoods byprotecting the long-runproductivity of naturalresources and ecosystems.This will involve reform-ing property rights; in-creasing the scope ofc o m m u n i t y - d r i v e ndevelopment programsand community forestmanagement; assistingfarmers to invest in thequality of their land;piloting new mechanismssuch as payments forecological services; andreducing the level ofdistortions in prices andincentives affecting re-source management deci-sions.

! Reducing the risks ofnatural disasters by in-creasing analytical work;identifying natural re-source investments (suchas upland forest planting)that can reduce the inci-dence and severity ofnatural disasters; improvingweather forecasting; andproviding information topoor households and com-munities on the risks theyface.


P rotecting the globaland regional commonsis a key component of

the World Bank’s EnvironmentStrategy. Developing countriesare likely to be most threatenedby global environmental im-pacts since a larger share of thepopulation is dependent onnatural resources for their live-lihoods, and because they areless able to afford mitigationand adaptation measures. Cli-mate change is projected tocause significant increases infamine and hunger in many of

the world’s poorest areas. De-creasing precipitation willworsen conditions in manyarid and semi-arid areas, espe-cially in Sub-Saharan Africa.Rising sea levels could displacemillions of people from small-island states such as theMaldives and from low-lyingdelta areas of Bangladesh, Chi-na, and Egypt, while increas-ing temperatures couldincrease the incidence of vec-tor-borne diseases such as ma-laria and dengue fever.

rotectingthe GlobalCommons

THREATS TO THE GLOBAL ENVIRONMENT

While the task may seem monumental, protecting the globalcommons—climate, ecosystems, the diversity of life, sharedwater resources—must be at the forefront of sustainable de-velopment. Water is essential for the sustenance and health ofhumankind and indeed all species. Coastal and marine eco-systems include some of the most diverse and productive hab-itats on Earth, while marine fisheries are an important part ofthe world’s food supply. Agriculture, forestry, water resourcemanagement, and human settlement patterns depend on a sta-ble climate. Ecological processes maintain soil productivity, re-cycle nutrients, cleanse air and water, and regulate climatecycles. At the genetic level, diversity found in natural life formssupports the breeding programs necessary to protect and im-prove cultivated plants and domesticated animals, and thushelps safeguard food security. Yet, the global commons arebeing degraded at an alarming rate:! Eleven percent of the Earth’s vegetated surface (1.2 billion

hectares) has been significantly degraded by human activi-ty over the past 45 years, affecting more than 900 millionpeople in 100 countries.

! More than one fifth of the world’s tropical forests have beencleared since 1960. Globally, 12 million to 15 million hect-ares of forest are lost every year, in addition to substantialareas of grasslands and wetlands.

! The Earth is losing species at a rate higher than at any timein its history.

! The world’s oceans are threatened by nutrient and heavymetal pollution, severe overfishing, and disease. Coral reefsare being degraded at an unprecedented rate—as much as40 percent of the world’s reefs will be lost in the next 10 to20 years at current rates.

! According to the Intergovernmental Panel on ClimateChange, the Earth’s average surface temperature is expect-ed to rise by between 1.4 and 5.8 degrees C during the next100 years, compared with just over 0.6 degrees during thelast 100 years. Sea levels, which have risen by 10 to 20centimeters since 1900, could rise by between 8 and 88centimeters during the next 100 years.

P

JULY 2000–JUNE 2001 • (FY2001) 19

Genetic varieties, species, andplant and animal communitieshave critical uses as food,sources of new crop varieties,commodities, medicines, polli-nators, soil formers, and mod-erators of climate andhydrology. Biodiversity losscan thus undermine agricul-tural productivity both nowand in the future. Further, eco-systems provide importantbenefits such as water storageand purification, flood andstorm protection, and nutrientretention. In addition, manypeople consider biodiversityand ecosystems as having in-trinsic value for moral, reli-gious, or cultural reasons.These various values havebeen recognized in the Con-vention on Biological Diversi-ty, as well as the more targetedRamsar Convention on Wet-lands.

The Bank�s roleThere has been a slow butgrowing realization that globalenvironmental concerns, suchas long-term climate changeand biodiversity loss, shouldbe addressed as an extensionof the local, national, and re-gional environmental issuesthat underpin sustainable de-velopment. In that light, theBank has found that global en-vironmental interventions canonly be effective if such pro-grams take into account thedevelopment needs, local pri-orities, and constraints of com-munities and countries.

The Bank is committed to as-sisting client countries addressglobal environmental objec-

tives through internationalconventions and their associat-ed protocols, including theconventions on climatechange, stratospheric ozoneprotection, and biodiversity. Inthe early 1990s, the World Bankbegan a systematic program toassist client countries meet re-gional and global environmen-tal objectives. The initial rolewas as an implementing agen-cy for two global financingmechanisms: the MultilateralFund for the Montreal Proto-col (MFMP) and the GlobalEnvironment Facility (GEF).Since then, the Bank has mul-tiplied and diversified its ini-tiatives, partnerships, projects,and funding sources in an ef-fort to better help client coun-tries meet the objectives of theglobal conventions.

Under the Bank’s EnvironmentStrategy, the Bank’s global en-vironmental interventions willbuild on five principles:

1. Focus on the positivelinkages between povertyreduction and environmentalprotection. Many interven-tions designed to reducepoverty by improvinglocal environmental quali-ty and sustainable naturalresource management alsoprovide regional and glo-bal benefits. For example,community-based forestmanagement projects cansupport sustainable liveli-hoods while reducingforest loss and preservingbiodiversity and carbonsinks.

2. Focus first on local envi-ronmental benefits, and build

on overlaps with regional andglobal benefits. There aremany areas of potentialoverlap between local andglobal environmentalbenefits. For example,replacing low-qualitybiomass fuels withmodern and renewableenergy sources in ruraland peri-urban house-holds reduces indoor airpollution, mitigates res-piratory diseases, andreduces greenhouse gasemissions.

3. Address the vulnerabilityand adaptation needs ofdeveloping countries. Poorcountries suffer dispro-portionately from thedegradation of the globalcommons and from itsconsequences, such asclimate change. The Bankwill help assess the long-term impacts of climatechange on the vulner-ability of people in clientcountries. These assess-ments will contribute tobroader poverty reductionstrategies.

4. Facilitate transfer of finan-cial resources to clientcountries to help them meetthe costs of generating globalenvironmental benefits notmatched by national benefits.In cases where actionsdesigned to address re-gional and global concernsare not in the short- andmedium-term interests ofdeveloping countries, theBank will seek to engagethe GEF, the MFMP, orother special financing

mechanisms to compen-sate countries for theincremental costs theyincur to protect the globalcommons. In this regard,assistance with the phase-out of persistent organicpollutants (POPs) will bean important new area inwhich we can put thelessons learned under theMFMP program to work(see Box, top of page 20).

5. Stimulate markets for globalenvironmental public goods.We will help our clientcountries develop andbenefit from trade inenvironmentally crediblegoods and services, suchas greenhouse gas emis-sion reductions, and sus-tainably harvested andindependently verifiednatural resources.

Projects andprogramsOver the last decade, the Bank

has developed a sizable port-

folio that directly addresses

global environmental con-

cerns. Since 1991, the Bank has

committed more than $1.5 bil-

lion dollars in combined GEF

and MFMP funding, with as-

sociated funding of $5 billion

for climate change mitigation,

biodiversity conservation, the

phaseout of ozone-depleting

substances (see Box, bottom of

page 20), and protection of in-

ternational waters. In the cli-

mate change area, the World

Bank/GEF portfolio today in-

cludes 62 projects, for which


$6.2 billion has been mobi-

lized, including $730 million

from the GEF and the balance

from the World Bank Group,

donors, private investors, and

government counterparts.

The GEF program has cata-

lyzed funding for local action

in support of global environ-

mental objectives, effectively

engaged NGOs and other ele-

ments of civil society in the

country dialogue on environ-

mental management, and pi-

loted innovative approaches to

financing biodiversity conser-

vation and renewable energy

development. With access to

GEF resources, the Bank has

also been able to help riparian

countries and stakeholders

agree and act on regional en-vironmental priorities, thussupporting the developmentand implementation of region-al conventions or agreementsfor the management of a num-ber of international river ba-

sins, shared lakes, regionalseas, and shared groundwateraquifers. GEF resources havealso been successful in cata-lyzing private sector financingfor environmental improve-ments.

The GEF and MFMP programscomplement a significantlylarger share of Bank lendingtargeted toward the conserva-tion and sustainable use ofbiodiversity, the sustainableuse of forests, the managementof fresh and marine water re-sources, and the halting of landdegradation. The broadercountry and sector dialogueand consequent lending indi-rectly support such concerns.For example, lending for ener-gy pricing reform creates in-centives for adoption ofclimate-friendly technologies.Assistance for agricultural in-tensification or rural nonfarmemployment often serves toreduce pressures on naturalhabitats and biodiversity. Ca-pacity building for manage-ment of local environmentalissues will help overcome bar-riers to addressing global con-cerns. These impacts need to bebetter understood and evalu-ated.

MainstreamingWhile many GEF operationswere largely independent from

A DECADE OF OZONE PROTECTION AT THE WORLD BANK

Signed in 1987, the Montreal Protocol for the Protection of the Ozone Layer differentiates be-tween large consuming countries of ozone-depleting substances (ODS) and developing coun-tries with consumption under 0.3 kg per capita. The latter group of countries (Article 5 countries)are allowed more time to phase out ODS. In addition, Article 5 countries have received financialassistance to meet the incremental costs of converting to ozone-friendly technologies throughthe Multilateral Fund (MLF) for the Implementation of the Montreal Protocol.

In its 10 years working under the MLF mechanism, the Bank has channeled $291 million in grantfunding through 350 MLF-approved projects in over 20 Article 5 countries. The Bank was the firstagency to tackle the supply side of ODS. Since introducing these types of projects, the Bank hassigned agreements with the two largest Article 5 CFC producers and the Russian Federation—constituting 70 percent of global production by Article 5 countries and Russia. Russia has, as ofDecember 2000, ended all CFC production, and China and India are decreasing production an-nually with final closure by 2009. Completed projects have resulted in the phaseout of over 100,000tons of ozone-depleting potential—74 percent of the total ozone-depleting potential has beenphased out under the MLF to date.

GLOBAL ACTION UNDER THE STOCKHOLM

CONVENTION ON PERSISTENT ORGANIC POLLUTANTS

Persistent Organic Pollutants (POPs) are considered to be among the most dangerous pollutantsreleased into the environment by human activity. They are highly toxic, and can cause death,disease, and birth defects, among both humans and wildlife. Once released into the environment,they remain intact for exceptionally long periods of time and are transported by air and water,resulting in widespread distribution across the globe. They bioaccumulate in the food chain, andcan lead to high concentrations in fish, predatory birds, mammals, and humans.

An international treaty to control POPs was concluded in Stockholm in May 2001. Its goal is toprotect human health and the environment from the generation, use, and release of POPs. TheStockholm Convention includes comprehensive provisions to address the risks posed by an ini-tial group of 12 POPs (aldrin, chlordane, chlorinated dioxins and furans, DDT, dieldrin, endrin,heptachlor, hexachlorobenzene, mirex, polychlorinated biphenyls (PCBs), and toxaphene) usedin agriculture, disease vector control, industrial processes and created as unintentional byprod-ucts through some combustion processes. Other chemicals may be added to the list as scientificknowledge develops.

All parties to the Convention commit to developing alternatives to the use of POPs and to devel-oping action plans to reduce or eliminate the release of POPs to the environment. The WorldBank is assisting client countries to prepare for the implementation of the the Stockholm Conven-tion through its Montreal Protocol/POPs Unit. Countries are presently in the early stages of devel-oping capacity to meet their future obligations under the Convention. Under a Canadian POPsTrust Fund of CDN$ 20 million established at the World Bank and in its role as an implementingagency of the GEF (named as the interim financial mechanism under the convention), the Bank isworking with countries in all regions to help them better understand the Convention’s obligationsand the present status of POPs within their countries. The Bank is also assisting countries inidentifying initial capacity-building and enabling activities to help address identified issues.

JULY 1999–JUNE 2000 • (FY2000) 21

This article was prepared by ToddJohnson of the Environment Depart-ment, (202) 458-2435, fax (202) 522-2130.

World Bank operations duringthe “pilot” phase of the GEF,there has been a steady in-crease in the integration of GEFand Bank operations. The pro-portion of Bank-GEF projectswith directly associated IDA orIBRD funding increasedsteadily from 23 percent in fis-cal 1995 to 65 percent in fiscal2000. In the energy sector, en-ergy efficiency and renewableenergy operations today com-prise a huge share of the Bank’sportfolio in many client coun-tries.

Continued progress in incor-porating global environmentalobjectives at the project leveldepends on mainstreaming theenvironment and its global di-mension in the country dia-logue. Progress on this fronthas been mixed. The analysisof CASs completed in fiscal1999 showed that a limitednumber addressed local envi-ronmental issues of global con-cern and that GEF activities,although mostly identified,were only in part linked stra-tegically to the CAS objectives.

With a few notable exceptions,CASs did not acknowledge arole for the Bank in helpingcountries address their respon-sibilities under global environ-mental conventions.

PartnershipsThe Bank has entered into nu-merous formal and informalpartnerships to address issuesof regional and global impor-tance that cannot be addressedat the country level. Thesepartnerships have provided animportant adjunct to the tradi-tional Bank-government rela-tionship by building on theemergence of a vocal civil so-ciety and the increasing impor-tance of private sector invest-ments.

Through the CEO Forum onForests, the Bank has sought toapply the process of indepen-dent, transparent multistake-holder verification of compli-ance with forestry manage-ment standards that protectthe livelihoods of the poor.Under the IUCN/World Bank-

sponsored World Commissionon Dams (WCD), government,NGO, and industry represen-tatives have laid out key con-siderations governing thedevelopment of dams. Wehave also helped catalyze newmarket mechanisms, as in thecase of the Prototype CarbonFund (PCF), which demon-strates the feasibility of tradinggreenhouse gas emission re-ductions under the emergingregulatory framework of theKyoto Protocol’s Clean Devel-opment Mechanism (CDM).The World Bank/WWF ForestAlliance was formed in 1998 asa result of both organizations’deep concern about the con-tinuing depletion of forests

GEF and MFMP commitments, fiscal 1992�2000

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

1992 1993 1994 1995 1996 1997 1998 1999 2000

Fiscal year

GEF commitments

GE

Fan

dM

FM

Pco

mm

itm

en

ts(U

S$

millio

ns)

MFMP commitments

Note: Commitment amounts are based on World Bank management approvals.

worldwide and the effect ofthis depletion on many of theworld’s poorest people. Its goalis to significantly reduce therate of loss and degradation offorests of all types. Other part-nerships have engaged civilsociety in implementingprojects with significant globalenvironmental benefits. TheCritical Ecosystem PartnershipFund, for example, providessmall grants to NGOs to man-age ecosystem hotspotsaround the world.

Wor

ld Ba

nk

Poison dart frogs are native to the tropical rainforests of Nicaragua, Costa Rica,and Panama.


T he World Bank’s envi-ronmental agenda hasevolved gradually,

moving from a “do no harm”focus in the 1980s to a morecomprehensive, proactiveagenda aimed at “promotinggood” today. The Bank hasdesignated 10 key environ-mental and social “safeguardpolicies,” and the entire projectpipeline is subject to systemat-ic screening as a standard re-quirement of project prepara-tion and approval. Safeguardpolicies and procedures pro-vide guidelines for staff inidentifying and preparing pro-grams and projects. They helpintegrate environmental andsocial concerns into design andimplementation of Bank-sup-ported activities and promotesustainable development ob-jectives in client countries.

The safeguard policies comple-ment international and region-al environmental agreementssigned by client countries, rel-evant national and local lawsand procedures, and nationalrequirements for environmen-tal assessment. Although notwritten as an integrated set ofdocuments, the Bank’s safe-guard policies share comple-mentary objectives and under-lying principles. They havebecome internationally recog-nized references.

Evolution andcoverage ofsafeguard policiesThe Bank’s social safeguard

policies, namely Involuntary

he SafeguardPolicies at

the Core of theEnvironment

Strategy

T

Resettlement and Indigenous

Peoples, were among the first

to be established, in the early

1980s. Together with the 1989

Environmental Assessment (EA)

Policy, they have helped the

Bank and its clients incorpo-

rate environmental and social

aspects of proposed invest-

ments into the decisionmaking

process. Since 1989, policies

have been added to further

protect specific aspects of the

environment and physical cul-

tural property. This reflects a

continual broadening of the

safeguard approach, from an

evaluation of potential im-

pacts using EA, to inclusion of

complementary instruments

such as resettlement plans,

indigenous peoples’ develop-

ment plans, and pest man-

agement plans.

The coverage and quality of

application of Bank safeguard

policies at a project level have

gradually improved over the

past two decades. Our clients,

staff, and partners have be-

come better at identifying,

early on, investments with po-

tentially significant adverse

environmental and social im-

pacts. The experience of work-

ing on Bank projects often has

contributed to strengthening

local capacity to carry out EAs

and implement environmental

management plans. Public

consultation and disclosure

mechanisms have fostered de-

bate about alternative devel-

opment options and impacts

from proposed programs, and

A REGIONAL PERSPECTIVE

ON SAFEGUARDS —THE AFRICA REGION

A few countries in Sub-Saharan Africa havestrong capacities in environmental assessment.Most, however, do not, especially in terms ofenforcement and compliance. This provides usa challenge and opportunity to emphasize ca-pacity building and to spend more time work-ing with task teams and borrowers. Even withsome degree of technical and human capaci-ty, environmental units in African countries haveto convince heavyweight public decisionmak-ers such as Ministries of Finance or Planning,a situation which has its parallels inside theBank.

In spite of these challenges, noticeableprogress has been made recently in areas likeprivatization where environmental audits aremore and more frequent. The Africa Region isparticularly proud of the praise it received forgood safeguard practice on the Regional TradeProject, an innovative field.

More efforts are needed to strengthen EA ca-pacity and create, in most cases, social safe-guard capacity. Above and beyond the recurrentissue of getting the right resources to work moreeffectively, what is most important is to movefrom a compliance mentality to a pro-activemode by focusing on the safeguards’ purpose,such as protecting vulnerable groups and theenvironment from unintended impacts of Bank-funded projects in Africa and ideally making ourprojects more sustainable for the long run.

JULY 2000–JUNE 2001 • (FY2001) 23

helped communities to better

benefit from development ac-

tivities.

Challenges forimprovementEarly evaluation. A 1996 review

by the Bank’s Operations Eval-uation Department (OED)found that EAs in manyprojects subject to full environ-mental assessment (categoryA) did not adequately consid-

er alternative designs, or start-ed too late to adequatelyinfluence decisionmaking.Similar problems throughoutthe world have led to increaseduse of EAs at the strategic

level.

Changing lending profile. In-creased emphasis on policyand programmatic lending,use of innovative instruments

such as Adaptable ProgramLoans (APLs) and Learningand Innovation Loans (LILs),and expansion of CommunityDriven Development (CDD),pose challenges for safeguard

policies, which must be adopt-

ed and effectively used in these

settings. The principles of con-

sultation and disclosure of in-

formation must be applied

routinely.

Development of integrated safe-

guard system. Treatment and

implementation of safeguard

policies as an integrated

“suite” is now accomplished

through a “parliament” of

practitioners in the Bank: the

Safeguard Management and

Review Team (SMART), which

includes all regional safeguard

policies coordinators and poli-

cy specialists. Its secretariat is

provided by the Quality Assur-

ance and Compliance Unit

(QACU), which reports to the

Vice-Presidency for Environ-

mentally and Socially Sustain-

able Development (ESSD).

Strengthening institutional

frameworks . Implementing

safeguard policies in projects

depends on the regulatory and

incentive framework estab-

lished by client country envi-

ronmental legislation. The

Bank will continue to assistmany countries in introducingenvironmental policies andprocedures.

Increased emphasis on supervi-

sion. Bank reviews indicatethat whereas environmentaland social safeguard policiesare often successfully usedduring project design andpreparation, problems can oc-

cur in implementation ofagreed mitigation, monitoring,and institutional strengtheningactions. This requires carefulevaluation of client countries’commitment, access to re-

sources, and skills needed toundertake agreed actions.

Greater cost efficiency. Increas-ing costs of compliance withsafeguard policies have be-

come a concern for the Bankand its clients. The most effec-tive way to reduce costs is toidentify issues at the earliestphase of program or projectdevelopment and fully inte-

grate safeguard studies intothe planning, review, and de-cisionmaking process.

Expanded coordination with part-

ners. Use of EA and other in-

struments can be improved byexpanding cooperation withother international financialinstitutions, donors, exportcredit agencies, and the privatesector. Coordinated approach-

es to safeguard policies at theinstitutional and/or projectlevel helps to avoid conflictsand improves project develop-ment.

This article was prepared by JeanRoger Mercier, (202) 473-5565, of theEnvironment Department’s QualityAssurance and Compliance Unit, fax(202)477-0565.Safeguards website —http://wbln0018.worldbank.org/in-stitutional/manuals/opmanual.nsf

Coming upPreparation of the Bank’s En-

vironment Strategy provided

an opportunity to examine

ways to increase safeguard

policy effectiveness. Efforts are

focusing on:

! Mainstreaming the inte-

grated safeguard policy

approach, notably through

use of an Integrated Safe-

guard Data Sheet

! Reaching out to bor-

rowers, other financiers,

consultants, and civil

society through infor-

mation and training

programs in association

with the World Bank

Institute

! Strengthening borrowers’

policies and institutional

capacity

! Expanding the use of

Strategic Environmental

Assessment (SEA) as a tool

for “upstreaming” envi-

ronmental and social

safeguards issues into

development policy, plan-

ning, and investment

processes

! Harmonizing environ-

mental assessment princi-

ples among international

development financiers.

J. &

K. Ma

cKin

non

— Indonesia


terized by high rates of soil erosion and deforestation, as wellas declining rangelands, wetlands, and fish and wildlife popu-lations. Climate variations, already a serious threat to liveli-hoods and economic development in much of the region, arelikely to be further aggravated by climate change within thenext few decades. Environmental degradation is—along withpopulation growth, political conflicts, and the HIV-AIDS cri-sis—one of the major factors threatening the fragile progress ineconomic, social, and political development that many Africancountries have achieved over the past few decades.

The Africa Region EnvironmentStrategyThe Africa Region Environment Strategy (ARES) aims to helpWorld Bank clients achieve sustainable poverty reductionthrough better environmental management. Approachingenvironment through a “poverty lens,” the strategy targetsfour main objectives:

Africa Region

IBRD 31567 OCTOBER 2001

I n Africa, perhaps more than in any other

region, the World Bank’s mission to

fight poverty is inescapably linked withenvironmental protection and improved management of re-newable natural resources. In both rural and urban settings,the poor are the most affected by the loss of natural resourcesand the deterioration of environmental services. They are alsoat the greatest risk from natural disasters, particularlydroughts and floods, whose impacts are aggravated by envi-ronmental degradation. The national economies of Africancountries rely mainly on agriculture and on extraction of min-eral and biological resources. In Africa, better environmentalmanagement is not just a matter of preserving nature; it is amatter of survival.

Yet this natural resource base on which so much depends issteadily deteriorating. Many parts of the region are charac-

C. Ca

rnem

ark

— Kenya

JULY 2000–JUNE 2001 • (FY2001) 25

! Ensuring sustainable livelihoods. Thestrategy highlights the over-whelming importance of landdegradation and desertification; thedeterioration in quality and growingscarcity of surface water andgroundwater; and the loss ofproductive natural ecosystems.

! Improving environmental health .Africans suffer a higher total burdenof disease than their counterparts inother regions. Many of the mostwidespread and debilitatingdiseases, particularly those thatdisproportionately affect the poor,stem from environmental conditionssuch as water and air pollution.

! Reducing vulnerability to naturaldisasters and extreme climate events.Africa is characterized by a highdegree of climate variability,resulting in chronic and severeimpacts on economic developmentand livelihoods, particularly of thepoor. Droughts, floods, landslides,and wildfires are all naturallyoccurring events whose frequencyand impacts can be increased byenvironmental degradation.

! Maintaining global ecosystems andvalues. Africa’s vast and uniquebiodiversity endowment is rapidlybeing lost as natural ecosystems aredepleted or converted to other uses.The region is also highly vulnerableto climate change, which is expectedto increase average temperatures andmake rainfall even more erratic,particularly in the already hard-pressed Sudan-Sahelian andsouthern regions.

Lessons learnedThe Africa Environment Strategy summa-rizes Bank experience and lessonslearned, including:! The importance of longer time frames

to support institutional developmentand environmental action

! The need for institutional capacitybuilding to go beyond national to

local government and communitylevels, and to take into account thechanging roles of government, civilsociety, and the private sector

! The need to move the EnvironmentalAssessment (EA) process both“upstream” into sectoral and area-based planning processes and“downstream” into the projectimplementation phase

! The need to develop long-term andsustainable financing mechanisms,and to ensure that institutionaldevelopment is based on a realisticassessment of resources availablenow and in the future.

Priorities for actionFollowing the structure of the Bank-wideEnvironment Strategy, the Africa Strategyorganizes priorities for action within thethree broad categories of improving thequality of life, improving the quality ofgrowth, and maintaining the quality ofthe global commons.

The strategy identifies specific prioritiesfor action in six sub-regions: the Sudano-Sahelian belt, humid West Africa, theCongo Basin, East Africa, Southern Africa,and the Indian Ocean Islands. Some is-sues, such as land degradation, areequally significant across the continent,while others, such as coastal zone man-agement and water scarcity, are more lo-calized. The strategy also identifiespriorities relating to key sectors. Sectorstargeted for their strong significance toenvironmental management include ag-riculture and rural development, naturalresource management, energy, urban de-velopment, water resource management,transport, health, and private sector de-velopment.

The strategy calls for a “people-focusedecosystem management” approach to de-velopment. Maintaining well-functioningecosystems and ecological processes is

critical to meeting human needs and en-hancing economic production on a sus-tainable basis. For example, the Bank isactively supporting integrated coastalzone management through regional, sub-regional, and country-specific initiatives,including coastal and marine biodiversitymanagement projects in Mozambique,the Gambia, Senegal, Guinea and GuineaBissau, as well as a Western Indian OceanFisheries project (see Box, page 26).Adopting an ecosystem-based approachhas important strategic and operationalimplications, such as planning and man-aging land use over large (often cross-border) areas; developing consensus andcoordination among many differentstakeholders; making compromises andtrade-offs among different environmen-tal and development objectives; and de-veloping up-to-date information onecosystem conditions and the processesthat sustain them.

The Africa Strategy places a high prior-ity on creating an enabling environmentthat motivates and enables large numbersof people and diverse institutions to man-age and protect the environment. The es-sential elements include a broadconsensus on environmental and sustain-able development objectives; policy,regulatory/legal, and institutional frame-works to support these objectives; andmechanisms to monitor results and usethem in decisionmaking. To improve theeffectiveness of our support for environ-mental management, the Bank must fo-cus on reversing the incentives thatcurrently drive people, individually andcollectively, to destroy or degrade the en-vironment, and on providing the essen-tial technical and institutional tools forenvironmental stewardship. For example,government policies often encourage thedestruction of natural habitats by award-ing land rights to people who “improve”these areas by converting them to agri-culture and other uses. In the Burkina

A f r i c a RA f r i c a RA f r i c a RA f r i c a RA f r i c a R e g i o ne g i o ne g i o ne g i o ne g i o n


Faso PRONAGEN project, local commu-nities will become the managers and cus-todians of key wildlife areas and willreceive both assistance and direct incen-tives for good stewardship.

Lack of adequate resources to promote,implement, and monitor the impacts ofenvironmental action is a perennial con-straint to improving environmental man-agement. Bilateral and multilateralassistance for environmental manage-ment and protection will continue to beimportant in Africa, particularly in rela-tion to global environmental objectives,but it must be complemented by othermechanisms, including revenue genera-tion and greater private sector invest-ment. Key objectives include generatingsustainable funding for environmentalmanagement through supporting policyreforms that create an enabling environ-ment for environmentally sound invest-ment; introducing and refining user fees,taxes, penalties, and other economic andmarket-based instruments; targeting Glo-bal Environment Facility funding for ac-tivities that address both national/localand global priorities; enhancing Africancountries’ access to markets for global en-

vironmental services; and supporting the

development of long-term financing

mechanisms such as trust funds. A num-

ber of recent projects include components

to establish trust funds or revenue gen-

eration mechanisms to ensure the

sustainability of biodiversity conserva-

tion and other environmental objectives

(for example, the Malawi Mulanje Moun-

tain Conservation Trust). Several initia-

tives are also under development to

mobilize investments for carbon seques-

tration through forest management,

reforestation, and improved land man-

agement—for example, under the Inte-

grated Land and Water Management

Action Program in Africa (see Box, page27).

Implementing the StrategyWhile environmental management is along-term undertaking, urgent action isneeded to stem ongoing environmentaldegradation and to prevent further deg-radation resulting from poorly conceivedor implemented activities. Such actionsinclude:! Improving the application of

Environmental Assessments and

other environmental and socialsafeguards, particularly by increas-ing attention to implementation andmonitoring and by moving assess-ments “upstream” into planningprocesses through Strategic Environ-mental Assessments

! Moving toward longer-term pro-grammatic operations that combineconcrete, substantive goals forimproving environmental qualitywith a flexible approach to imple-mentation.

In-country capacity building will con-tinue to be a main focus. Specific activi-ties at the regional and country levels willinclude building in-country capacity forenvironmental management, includingstrengthening of EA legislation, applica-tion, and monitoring; training andstrengthening employment opportunitiesfor local environmental professionals;and environmental support programsthat focus on strengthening environmen-tal planning and action within sectoralagencies and at the community level.Examples include the Uganda Environ-mental Management Capacity Building

IMPLEMENTING INTEGRATED COASTAL MANAGEMENT IN SUB-SAHARAN AFRICA

The Africa Region has developed a process to identify promising opportunities forintegrated coastal zone management projects. The process involves screening ofcountries based on “first order criteria” such as political stability; a high level of de-pendence on coastal resources; use or potential use of coastal and marine resources;and a substantial threat to these resources. Candidate countries are then rankedbased on “second order” criteria such as country commitment, availability of partners,and external assistance through existing World Bank or other donor-financed pro-grams. Identifying and designing specific interventions calls for an evaluation of “thirdorder” criteria such as clarity of property rights regimes, existence of incentives forand against sustainable use of coastal and marine resources, and the level of localcapacity. Global criteria—that is, the global significance of certain marine and fresh-water coastal areas—are also significant, in part because of the opportunity to mobi-lize GEF co-financing. Another important consideration is the opportunity to enhancesub-regional integration through collaborative management and development of sharedcoastal resources.

Countries with priority integrated coastal management initiatives include the Seychelles,South Africa, Mozambique, Mauritius, Madagascar, and Ghana. Countries where inte-grated coastal management needs are urgent and complex, but where the “institu-tional core” is not as strong, include Senegal, the Gambia, Tanzania, Nigeria, Kenya,Namibia, Cote d’Ivoire, Guinea, Benin, and Guinea Bissau.

— Tanzania

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A f r i c a RA f r i c a RA f r i c a RA f r i c a RA f r i c a R e g i o ne g i o ne g i o ne g i o ne g i o n

Project, the Malawi Environment Man-agement Project, the Burkina FasoCommunity Support Program, the Mada-gascar Environment Program, the Nige-ria Micro-Watershed and EnvironmentalManagement Program, and many others.

Over the long term, effective environ-mental management requires buildingenvironmental objectives, actions, andtargets into country and sectoral strate-gies and operational programs. This re-quires providing the information neededto inform and persuade decisionmakersthat addressing environmental andrelated social concerns is essential to de-velopment; identifying realistic develop-ment options and spelling out the costs,benefits, and trade-offs involved; and pro-viding the tools to support implementa-tion of environmentally favorableoptions. Priority will be given to coun-tries where there are strong and clear link-ages between environmental improve-ments and poverty alleviation, demon-strated interest on the part of clients and

GEF IN AFRICA — INTEGRATION,DIVERSIFICATION, AND QUALITY

The Global Environment Facility (GEF)portfolio in Africa has grown over thepast few years and become more di-versified. Land degradation, the high-est priority environmental issue for mostAfrican countries, provides an importantentry point. The newly launched GEF-financed Africa Integrated Land andWater Management initiative will sup-port strategy development, capacitybuilding, and pilot operations in at leastsix countries. Programs that can linkglobal and local issues, such as com-munity-driven development, are underpreparation in countries such asBurkina Faso and Niger.

The Africa Global Environmental Coor-dination Team is responsible for moni-toring and evaluation of the Region’sportfolio. During the past year, the Co-ordination Team has piloted video de-briefing sessions as a means ofcapturing experiences, lessons, andgood practice from project preparationand implementation.

Country Teams, and substantial Bank in-volvement.

Key activities will include developingand piloting tools and models for coun-try-specific analysis of environmentalconditions, issues, and opportunities;enhancing environmental sustainabilityin key sectors by improving incentivestructures; and developing meaningfuland practical indicators for assessing en-vironmental conditions and trends, envi-ronmentally related poverty impacts, andthe extent to which environment is inte-grated into development planning andoperations. For example, a major studyin Nigeria will analyze environmentaldegradation, impacts on poverty, andoptions for harmonizing sectoral priori-ties. A similar analysis in the DemocraticRepublic of Congo will focus particularlyon environment/health linkages.

Strategic partnerships will be vital to theimplementation of the Strategy. In addi-tion to traditional partners such as bilat-eral donors and international NGOs, the

Collecting water in Senegal. Lack of access to clean water supplies and sanitation is an environmentalhealth risk affecting millions of the region’s poor.

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This article was prepared by Agi Kiss of theAfrica Technical Families: Environment andSocial Development Unit, (202) 458-7180, fax(202) 473-8185. AFR website —http://wbln0018.worldbank.org/afr/afr.nsf

Bank will continue to explore the poten-tial for collaboration with the private sec-tor in areas such as technologydevelopment and transfer, specializedtraining and information exchange, andenvironmental cleanup.


East Asia and Pacific Region

Countries in the East Asia and Pacific

Region have two distinguishing fea-

tures with important environmen-tal implications: high population densities and relatively rapidrates of economic growth. The region, now home to 1.8 billionpeople, is expected to reach 3.1 billion by the year 2015. Nearlytwo thirds of the region’s people live in rural areas, with farm-ing or other resource-dependent occupations as their primarymeans of livelihood. But the share of the population living inurban areas is rapidly increasing. Between 1980 and 1998, theurban population nearly doubled from 310 to over 600 millionpeople, placing additional strains on the environment.

Notwithstanding the economic crisis that occurred during the1990s, the region experienced the fastest rate of economicgrowth in the world over the past 25 years. In some respects,this growth created the potential for benefiting the environ-

ment by introducing cleaner technologies and generating newsources of revenue for addressing environmental externalities.However, rapid industrialization and an expanding urbanpopulation have so far outpaced the ability of new technolo-gies and pollution control investments to reduce overall pol-lution loads, resulting in deteriorating air, water, and solidwaste pollution in many countries in the region.

Air and water pollution stand out as the region’s most seriousand economically costly environmental issues. More than500,000 infants die each year as a result of waterborne diseaseslinked to polluted water. About 60 percent of these deaths areattributable to deficient rural water supplies, while another 30percent are caused by the lack of sanitation in urban areas.These impacts are equivalent to shortening the average lifeexpectancy of everyone in the region by nearly two years. Inaddition, damages from air pollution are serious in many largecities in the region—including Jakarta, Manila, and Bangkok—and are extremely costly in China, where air pollution is esti-


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mated to cause over 200,000 prematuredeaths annually. In some cities in the re-gion, it is estimated that total health dam-ages are equivalent to 20 percent ofannual income.

In many parts of the region, natural re-sources are deteriorating and are undergrowing pressure. Though more difficultto measure than pollution costs, thestakes are high, since they involve thesustainability of key natural resource-based activities—such as agriculture, fish-ing, and forestry—and of humansettlement patterns. In the early 1990s,deforestation rates in East Asia were thehighest of any region. Indonesia alone lostabout 20 million hectares of forest coverbetween 1985 and 1997. Since the 1960s,the Philippines has lost nearly 90 percentof its productive old-growth forests. Inthe Pacific Island nations, marine ecosys-tems are being progressively destroyed.Climate change could exacerbate manyof these problems and is a major threat tosmall islands, coastal areas, and drylandand non-irrigated agricultural systems.

The Bank�s record andfuture challengesIn the EAP Region, the Bank has beenactive in three main areas: (1) environ-mental institutional development; (2) ur-ban environment and industrial pollutioncontrol; and (3) natural resource manage-ment.

Environmental Institutional Development.The Bank has provided technical assis-tance to strengthen national environmen-tal agencies in the region. Through theirrole as implementing agencies for Bank-supported environmental projects, manyprovincial and municipal agencies—inthe areas of transport, construction, andutilities, as well as environment—haveimproved their technical, financial, andassessment capabilities in the environ-

ment field. Examples include the YangtzeBasin Water Resources DevelopmentProject and Huai River DevelopmentProject in China, and the Java Water Irri-gation and Water Resources ManagementProject in Indonesia. To be effective overthe long term, the Bank’s support for en-vironmental capacity must emphasizestrengthening local environmental sys-tems, community participation, environ-mental education, and the importance ofinstitutions other than environmentalagencies to promote policy reform andfollow-through on implementation. Insti-tutional capacity building is a necessarycomponent of overall environmental im-provement and must be done in tandemwith environment and policy develop-ment, environmental infrastructure in-vestments, and awareness raising.

Urban Environment Pollution Control. TheBank has been an important source of fi-nance for environmental infrastructure inthe region. In the sanitation sector incountries such as China and the Philip-pines, the Bank has promoted the creationof autonomous water and wastewatercompanies and the establishment of wa-ter and pollution charges, both to helpreduce pollution and to finance operationand maintenance to guarantee long-termsustainability. Water pollution invest-ments have predominantly been for theprovision of clean drinking water sup-plies, sanitation, and drainage. Futurepublic investments for water and air pol-lution management will depend on solv-ing recurrent financing issues, which inturn requires political commitment to theadoption and reform of environmentaland resource policies.

Natural Resource Management (NRM). De-spite more than a decade of attention,policymakers in the region are just begin-ning to recognize the importance of NRMissues to sustainable economic develop-ment. Most Country Assistance Strategies

(CASs) have not been effective in high-lighting the macroeconomic, policy, andinstitutional factors that affect a country’senvironmentally sustainable develop-ment. Over the past 10 years, the Regionhas prepared strategy studies on forestry,watershed management, and biodi-versity. Some studies, including those forthe Philippines, Indonesia, and Vietnam,have been instrumental in shaping natu-ral resource management programs inthose countries. While many agriculturaldevelopment projects have been success-ful in raising farm-level incomes, theyhave not generally been effective in pro-moting sustainable NRM. The challengeis to redirect rural development initiativesaway from individual agricultural pro-duction projects toward sustainableNRM.

Strategic priorities andactionsIn three areas—the quality of life, qualityof growth, and quality of the regional andglobal commons—the Bank can simulta-neously promote poverty reduction andenvironmentally sustainable develop-ment in the region.

Quality of Life. Nearly all client countriesare experiencing severe water pollution-related health problems. New and in-creased support for urban sanitation anddrainage investments and for rural andperi-urban water supply and sanitationactivities is envisaged in most countriesin the region. Fine particulates, producedprimarily from fuel combustion, are agrowing concern in nations such asChina, Indonesia, the Philippines, Thai-land, and Vietnam. The Bank is support-ing a number of cost-effective solutionsto address this issue within the East AsiaClean Air Initiative (see Box, page 30). Inthe transport area, interventions includeswitching to unleaded gasoline; improv-ing fuel quality; introducing cleaner ve-


hicle technologies and improved mainte-nance and inspection; and promoting ur-ban planning that is less traffic-intensive.

Better management of natural resourcesis essential for safeguarding rural liveli-hoods in the region. Effectively address-ing these issues requires a long-term andconcerted effort, including integratingnatural resource policy within macroeco-nomic policy and agricultural develop-ment agendas of national governments.A priority for the Bank is to identify criti-cal NRM issues in countries of the region,and ensure that policies that support sus-tainable resource management are incor-porated within the CAS/CDF/PRSPprocesses, as in the case of Indonesia,Mongolia, Thailand, and Vietnam. Asidefrom the “5 million hectare” afforestationprogram in Vietnam, the Bank will pri-marily support smaller-scale communityforestry programs, with an emphasis onconservation and sustainable forestry de-velopment. A resumption of Bank sup-port to the forestry sector in Indonesia isdependent on progress on two issues:broadening the dialogue on forestry

policy and management to non-forestagencies, and delegating managementauthority over degraded forests to par-ties outside the forestry bureaucracy, suchas local communities, NGOs, the privatesector, and other natural resource agen-cies.

Reducing vulnerability to natural disas-ters is a critical issue in the region. TheBank has provided support for relief andreconstruction following floods, volcaniceruptions, and earthquakes in nationssuch as Cambodia, China, and Mongolia.Moving from curative to preventive ac-tions, the Bank plans to become more in-volved in addressing long-term riskreduction and mitigation measures aspart of its advisory assistance and invest-ment operations.

Quality of Growth. In the macroeconomicand sector policy arena, the Bank willpromote policy reforms that improvenatural resource use and reduce pollutionexternalities. In addition to investment

projects, the Bank can also promote envi-ronmentally sound policies within thecontext of sectoral adjustment loans.

In nations such as China, the Philippines,and Thailand, the Bank continues to pro-vide support for environmental assess-ment, strengthening local environmentalplanning and regulatory capacities, andimproving environmental financing. Inaddition, the Bank is actively promotingnew approaches in environmental regu-lation through both lending and non-lend-ing activities. Public disclosure ofenvironmental information is a promisingway to encourage pollution preventionand abatement and publicize the environ-mental performance of industrial enter-prises (see Box, page 31). Furthermore,recent reviews of the Bank’s safeguardsrecord indicate that increased attentionneeds to be paid to building up localenvironmental management and en-vironmental assessment capacity, improv-ing public consultation, and integratingenvironmental and social assessments.

ENVIRONMENTAL PARTNERSHIPS

To help countries in the region to ad-dress major environmental concerns,the Bank is developing a number of for-mal and informal partnerships. Severalforestry activities are under way as partof the World Bank/WWF Forest Alli-ance, while the World Bank-NatureCouncil-Birdlife International partner-ship focuses on major biodiversity con-cerns. Under the Clean Air Initiative, theBank will collaborate with multilateraland bilateral donors, the private sector,and regional governments to share ef-fective air quality lessons. The WorldBank-Korea Knowledge Partnership isdesigned to share Korea’s environmen-tal experience with other countries in theregion. Currently focusing on industrialpollution abatement and environmentalmanagement, this partnership could ex-pand to cover other issues of impor-tance in the region.

A two-stroke engine, three-wheel motor vehicle. China.

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This article was prepared by Giovanna Dore ofthe East Asia and Pacific Region, (202) 473-2934, fax (202) 522-1666; and Todd Johnson ofthe Environment Department, (202) 458-2435,fax (202) 522-2130. EAP website —http://wbln0018.worldbank.org/eap/eap.nsf

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Quality of the Re-gional and GlobalEnvironment. As amultilateral insti-tution, the Bankcan play an im-portant role inhelping addressregional environ-ment issues, suchas river basinmanagement andacid rain. Some ofthese issues havealready gainedthe attention ofpolicymakers inthe region. GEFrecently approvedsupport for theMekong RiverCommission to establish mechanisms topromote and improve coordinated andsustainable water management, includ-ing reasonable and equitable water utili-zation by the countries of the Basin; andto protect the environment, aquatic life,and the ecological balance of the Basin.

In the climate change area, the Bank willsupport energy efficiency and fuel switch-ing through GEF and other concessionalresources that build on lessons learnedthrough the Asia Alternative Energy Pro-

MONITORING ENVIRONMENTAL TRENDS

IN EAST ASIAN COUNTRIES

Making information on environmental trends accessibleto decisionmakers and to civil society is essential to in-formed public debate on environmental issues. The En-vironment Monitor series, initiated in 1999, aims topresent available information on key environmentaltrends in East Asian countries. The Monitors use charts,graphs, and explanatory text to follow trends in variousenvironmental indicators such as air and water quality,deforestation, and waste management. As far as pos-sible, the Monitors describe both current conditions andtrends over time.

Environment Monitors have been prepared for the Phil-ippines and Thailand. Similar efforts will be undertakenin Cambodia, China, Papua New Guinea, and Vietnam.

gram and operations like the ThailandChiller Replacement Project. New opera-tions are planned for Cambodia, China,Mongolia, the Philippines, Thailand, andVietnam.

In the face of serious threats to ecosys-tems and biodiversity in the region, theBank has developed an extensive portfo-lio of biodiversity projects, most of whichtake an ecosystem approach to conserva-tion and are focusing on biodiversitymanagement, both within protected ar-eas and beyond their boundaries into the

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production landscape. The Kerinci-SeblatNational Park Integrated Conservationand Development Project is a sound ex-ample of this approach, and similar ini-tiatives are underway in Vietnam, and thePhilippines.

Supporting the phaseout of ozone-depleting substances is a continuing pri-ority. Currently, there are phase-outprojects for ozone-depleting substances(ODS) in China, Indonesia, Malaysia,Thailand, and the Philippines. The re-gional program, particularly the one inChina, has moved from a project-level toa programmatic approach, allowing amore systematic and comprehensivephaseout from all the key contributingsectors. Furthermore, given the region’sintensive industrialization and wide-spread use of agricultural chemicals,there are plans to develop a major pro-gram to address persistent organic pol-lutants (POPs).

A coastal village in Indonesia damaged by both an earthquake and a tsunami.


Europe and Central Asia Region

— Romania

Regional and environmental context

The 27 countries in the Europe and

Central Asia Region are all in vari-

ous stages of transition from cen-trally planned economies, with the exception of Turkey. Thepace of environmental improvements also varies, in part be-cause of the different nature of environmental issues facingthese countries and in part because poverty rates are widely

divergent, from below 10 percent in countries in Central Eu-rope to 68 percent in Tajikistan. Civil conflicts, natural disas-ters, refugees, and ethnic problems are major complicatingfactors in Central Asia, the Balkans, and the Caucasus.

Regional Divergence. Environmental challenges vary within the

region. Environmental challenges from past liabilities remainan issue in highly polluting industries such as chemicals, pet-

rochemicals, and metallurgy. Water supply and water resourcemanagement are the over-riding priorities in Central Asiancountries and Azerbaijan, in part due to the collapse of theSoviet-era system of canals and dikes. Severe soil salinizationis also a legacy from this system and requires improved irri-gation and drainage management. Reducing agricultural andindustrial pollution, restoring wetlands, and improving waste-water management are priorities throughout the region.Biodiversity is also under pressure from infrastructure devel-opment and illegal logging and poaching. Forest resourcesand their management are also critical. Russia, for example,has 22 percent of the world’s forests and 18 percent of OECD’sgreenhouse gas emissions. The cost of meeting EuropeanUnion (EU) environmental requirements is an issue for theEU accession countries.

Reforms are Critical. The ability to address environmental is-sues is closely linked with progress in implementing impor-tant structural reforms, such as:

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! Privatizing the consumer andindustrial sectors, promoting freetrade, and other measures thatestablish fiscal and macroeconomicstability and help promote theefficient use of resources

! Assessing the real costs of watersupply and tradeoffs between energyand agriculture; introducing betterwater management and irrigationpractices; rehabilitating irrigationschemes, and making water userspay to maintain them

! Reforming municipal water andsewerage and solid waste utilities,including eliminating subsidies andraising tariffs

! Introducing incentives for efficientenergy use, eliminating fuelsubsidies, making the energy sectorcompetitive, promoting lead-freefuel, introducing metering, andotherwise reforming district heatingcompanies

! Introducing more cost-effective andsustainable natural resource man-agement practices

! Establishing basic environmentalprotection and management systems,and ensuring public participation inenvironmental issues.

The political dynamics in the region fre-quently impede such reforms. For ex-ample, municipalities are often reluctantto eliminate energy and water subsidiesor raise tariffs, despite deteriorating in-frastructure and evidence of tremendouswaste that threaten access to clean waterin many urban areas. Politicians fear theirconstituents cannot afford rate increases,even though evidence suggests that muchof the population could do so. Wage ar-rears, barter payments, lack of metering,and the relative insolvency of many mu-nicipalities also complicate utility re-forms. As a result, privatization witheffective regulation is proving more suc-cessful than attempts to reform munici-pal enterprises.

Energy Availability. Lack of domestic en-ergy supplies is driving a rush for newstrategic alliances, and generating pro-posals for new oil and gas pipelines thatraise environmental concerns associatedwith construction and potential oil spills.In energy-rich countries, such as Russiaor Kazakhstan, the desire to maximizeexport earnings of oil and gas places re-newed pressure on domestic users toburn dirtier fossil fuels, particularly coal.For energy-poor countries, the increasingprices of energy inputs, together with theabsence of reforms at the distributionlevel, has led to the collapse of districtheating plants, the burning of alternativedirtier fuels, and the installation of less-efficient small boilers.

Government Commitment. Although mostcountries in the region have a relativelygood legal and regulatory framework forenvironmental management, institu-tional capacity to implement and enforceregulations is weak, and government of-

ficials do not always agree on the impor-tance and urgency of environmental is-sues. On the positive side, increasingfreedoms have led to an increasingly vo-cal and influential civil society, includingNGOs and independent journalists, whoare pressing for these laws to be followed.

The regionalenvironment strategyThe Bank has developed a regional Envi-ronment Strategy for Europe andCentral Asia, based on extensive consul-tations with stakeholders in client coun-tries, other international organizations,and the donor community. The consulta-tions helped achieve consensus on envi-ronmental priorities, including the needto link environmental issues to povertyand health and to the general reformagenda. Individual country strategies aretied to localized environmental issues aswell as broader macro and reformagendas.

E u r o p e a n d C e n t r a l A s i a RE u r o p e a n d C e n t r a l A s i a RE u r o p e a n d C e n t r a l A s i a RE u r o p e a n d C e n t r a l A s i a RE u r o p e a n d C e n t r a l A s i a R e g i o ne g i o ne g i o ne g i o ne g i o n

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Paticipatory studies to understand the perspectives of users of natural resources including, in this case,irrigation water. Kyrgyz Republic.


To improve the quality of life, the regionalenvironment strategy will work to im-prove access to safe drinking water andsanitation; mitigate health threats fromindustrial accidents and toxic substances;support conversion to less polluting heat-ing fuels, more efficient heating, improv-ed traffic management, and reducedpower emissions; improve livelihoodsthrough support for sustainable forests,watershed management and energy con-servation; and improve security by plan-ning for and mitigating natural disasters.For example, the Kosovo Pilot Water Sup-ply Project and the Russia MunicipalWater and Wastewater Project are aimedat ensuring the availability of water andwastewater services to urban populationswhile implementing institutional andcommercial reforms to improve theirlonger term sustainability. In Moscow, a

newly approved Urban Transport Projectwill address traffic management and re-habilitate bridges, which should contrib-ute to the reduction of transportemissions. A project to assist Turkey to re-cover from the Marmara Earthquake in-cludes support to help Turkey better planfor earthquakes, mitigate their conse-quences, and recover more quickly after-wards.

To ensure the quality of growth, the strat-egy will focus on integrating environ-ment into macro and sector policies;building local capacity to assess the en-vironmental impact of policies; strength-ening legal and regulatory frameworksand environmental review capacity; andimproving the framework for private in-vestment through helping governmentsaddress environmental liability in thecontext of privatization. For example, theBank is supporting environmental re-forms and assisting the Government ofBulgaria to help newly privatized com-panies comply with environmental lawsand clean up environmental liabilities cre-ated prior to their privatization.

To improve the quality of the regional andglobal commons, the strategy will helpreduce greenhouse gas emissions; sup-port biodiversity conservation with theparticipation of local communities; im-prove management of international wa-ters; complete the phaseout of ozone-depleting substances; and begin to ad-dress broader resource degradation anddesertification issues. Projects to end theuse of ozone-depleting substances areunder way in Poland, Belarus, and Rus-sia (see Box, at right). Several forestryprojects address desertification, amongother problems (see Box, top of next page).The region has four important seas whereimproved transboundary cooperationand improved management are needed:the Aral Sea, the Caspian, the Black Sea,

and the Baltic Sea. We have ongoingprojects in each of them. The BulgariaWetland Restoration and Pollution Re-duction Project, for example, aims to helpreduce transboundary nutrient loads andconserve biodiversity in the Danube andBlack Sea Basins through improved man-agement and sustainable use of water re-sources and restoration of wetlands, someof which were former floodplains (seeBox, bottom of next page). In Latvia, theLiepaja Region’s Solid Waste Manage-ment Project includes measures to utilizelandfill gas for electricity generation. Theresulting reductions in greenhouse gasemissions will be partly sold to the Pro-totype Carbon Fund (PCF), making thisthe first project financed with PCF assis-tance.

The regional environment strategy is be-ing supported through a number of stud-

SPECIAL INITIATIVE FOR OZONE

DEPLETING SUBSTANCES

PRODUCTION CLOSURE

Russia has traditionally been one of theworld’s largest producers of ozone-depleting substances (ODS). In 1998,its production capacity represented al-most 50 percent of global capacity stillactive. The World Bank’s Special Initia-tive for Ozone Depleting SubstancesProduction Closure brings together 10donors and the GEF to help close allODS production in the Russian Federa-tion. Under the project, the Bank pro-vided a grant to the Russian Federation,which in turn provided payments to theenterprises as partial compensation forcosts associated with closing ODS pro-duction, based on clearly defined andverifiable outcomes. All ODS productionin Russia was terminated by Decem-ber 20, 2000. As of June 2001, closureactivities at all enterprises are substan-tially complete, such that they no longerhave the capacity to produce ODS. Clo-sure Verification Reports are underpreparation and final compensationpayments, subject to the Bank and Do-nor expert panel verification, are antici-pated in the fall of 2001.

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E u r o p e a n d C e n t r a l A s i a RE u r o p e a n d C e n t r a l A s i a RE u r o p e a n d C e n t r a l A s i a RE u r o p e a n d C e n t r a l A s i a RE u r o p e a n d C e n t r a l A s i a R e g i o ne g i o ne g i o ne g i o ne g i o n

This article was prepared by Jane Holt of theEnvironmentally & Socially SustainableDevelopment Sector Unit, (202) 458-8929, fax(202) 614-1528. ECA website —http://wbln0018.worldbank.org/eca/eca.nsf

ALBANIA: COMMUNITY-BASED FOREST MANAGEMENT IN A TRANSITION ECONOMY

Forests cover 38 percent of Albania’s land area, with broad-leaved forests—mainlyoak and beech—predominating. Fuelwood accounts for over 40 percent of recordedtimber production. Pasture land covers 15 percent of land area, and 60 percent of thepopulation is dependent or partially dependent on pastoralism. Forest and pastureland are owned by the state. Since 1990, Albania has moved rapidly with market-based reforms, but there have been increasing problems of governance and law andorder, including illegal timber harvesting.

The Community-based Forest Management Project aims to restore degraded state-owned forest and pasture areas and promote their sustainable use; promote conser-vation of natural forest ecosystems; and initiate a transition of the forestry/pasturesector to a market economy, separating commercial from regulatory functions andestablishing mechanisms for self-financing of the commercial activities. In addition toassisting with improving forest management at the local level and reorganizing theforest sector institutions, the project is improving trade, marketing, and pricing poli-cies to enhance revenue; implementing an action plan to reduce illegal harvesting, incollaboration with local governments and the Ministry of Finance Tax Inspection; andsupporting community forestry by providing local communities with legal user rightsfor communal and forest pastures, assistance to improve their management, andmechanisms to reinvest users fees into improved management and into training for-est specialists in the public and private sector.

Because of broader poverty, law and order, and governance issues, controlling illegalharvesting and improving forest management on publicly managed land has beendifficult. The transfer of user rights and management to local communities has workedwell; user rights have been transferred for 10 years. Local communities have beenassisted with development of management plans, and have invested user fees inimproving the resource. This component is being expanded, and may form the basisfor a follow-on natural resources and environment project.

THE STRATEGIC PARTNERSHIP ON THE BLACK SEA AND DANUBE BASIN

The environment of the Black Sea/Danube Basin has degraded drastically over thepast four decades, due to untreated wastewater discharges from industry and towns,excessive use of pesticides and fertilizers, land use changes, inadequate manage-ment of animal waste, oil spills, introduction of alien species, and overfishing. Envi-ronmental contamination has caused significant losses to riparian countries throughreduced revenues from tourism and fisheries, loss of biodiversity, and increased water-borne diseases. Over-fertilization (“eutrophication”) of water bodies by nitrogen andphosphorus discharges from municipal, industrial, and agricultural sources was themost significant cause of this ecological near-disaster.

The GEF Strategic Partnership on the Black Sea and Danube Basin was establishedby the Global Environment Facility (GEF), the World Bank, the United Nations Devel-opment Programme (UNDP) and the United Nations Environment Programme (UNEP).The goal of the Partnership is to return the Black Sea environment to its 1960s level.Clearly, reaching this goal requires cooperation by all stakeholders, including govern-ments, national and international NGOs, international organizations, private sectororganizations, and citizens of the region. The backbone of the partnership is the WorldBank GEF Investment Fund for Nutrient Reduction in the Black Sea/Danube Basin, tohelp finance investment projects in industrial and domestic wastewater treatment,wetland restoration, and environmentally friendly agriculture. A GEF grant of $29 mil-lion for the project will be invested during the first two years of a six-year, multi-trancheprogram.

ies, including efforts to understand thelinks between environmental problemsand health and poverty; evaluate the linksbetween energy and environment; adoptcleaner fuels, improve traffic flows, andpromote more fuel-efficient vehicles;quantify the fiscal and environmentalimpacts from better natural resourcemanagement, particularly forests; andlink agricultural productivity and rurallivelihoods to better agricultural practicesand irrigation restructuring.

Throughout the region, support for ca-pacity building is also continuing.

ImplementationarrangementsGiven the many linkages between envi-ronmental issues and other sectors,implementing this strategy requiresstrong cross-sectoral alliances with col-leagues working on energy infrastruc-ture, particularly urban water and districtheating, as well as agriculture, rural de-velopment, and forestry. Social assess-ments will be integrated into efforts todevelop rural community-based im-provement projects in water supply, irri-gation, and agricultural practices. Closecollaboration with our colleagues in thepoverty reduction and human develop-ment groups will also be required, par-ticularly to better assess linkages betweenpoverty, health, economic growth, struc-tural reforms, and environment; to assessthe environmental impacts of proposedstructural and policy reforms; and to in-corporate environmental agendas andpriorities into Country Assistance Strate-gies (CAS). We will also increase our ef-forts to be selective and leverage limitedresources through partnerships.


The Latin America and Caribbean Re-

gion countries are characterized by

economies that are increasingly in-tegrated into the world economy; the formation of regionaltrading blocks such as Mercosur; a high degree of urbaniza-tion; and a deepening of democracy, coupled with a trend to-ward increasing decentralization and improved governance.The key environmental issues in the region include (a) urban-industrial pollution; (b) mismanagement of natural resourcesin areas of both existing and new settlement, and the conse-quent loss of both terrestrial and marine biodiversity; and (c)high vulnerability of urban and rural populations to naturaldisasters.

The World Bank prepared an environment strategy for theregion during 2000-2001 with inputs from a wide variety ofstakeholders. The strategy, which reflects the considerable

heterogeneity in social and economic conditions within theregion, both within and across countries, seeks to supportshort-term poverty alleviation without compromising long-term sustainability. Its key development objectives are (a)enhancing livelihoods and reducing vulnerability throughsustainable natural resource management; (b) improvinghealth conditions affected by environmental factors; (c) de-veloping appropriate enabling frameworks for sound envi-ronmental management; and (d) facilitating equitablesolutions to regional and global challenges.

Enhancing livelihoodsTo enhance livelihoods through the sustainable managementof natural resources, the strategy supports efforts to identifyand analyze the causes, impacts, and costs of environmentaldegradation and natural resource depletion. It promotes theadoption of sustainable environmental management practicesto address environmental degradation and natural resource

Latin America and Caribbean Region


World

Ban

k

— Ecuador

JULY 2000–JUNE 2001 • (FY2001) 37

LLLLL a t i n A m e r i c a a n d C a r i b b e a n Ra t i n A m e r i c a a n d C a r i b b e a n Ra t i n A m e r i c a a n d C a r i b b e a n Ra t i n A m e r i c a a n d C a r i b b e a n R e g i o ne g i o ne g i o ne g i o na t i n A m e r i c a a n d C a r i b b e a n R e g i o n

depletion—particularly win-win activi-ties that both improve poor people’s live-lihoods and reduce environmentaldegradation.

One focus will be on developing a betterunderstanding of environment-poverty-economic growth linkages and trade-offs,including long-term versus short-termimplications of natural resource use. ThePanama Country Assistance Strategy pro-vides an example of this approach (seeBox, at right). As another example, theMexico Decentralization Loan seeks tolink objectives of overall accountabilityand transparency of fiscal transfers toimproved service delivery in the healthand environment sectors through decen-tralization.

Sustainable integrated natural resourcemanagement of land, freshwater, andmarine ecosystems will be another areaof emphasis. Efforts in this area will fo-cus on highly degraded or threatenedecosystems and disaster-prone areas. Inthe Mesoamerican Biological Corridor,the Bank is working with a number ofother donors to promote a pattern of sus-tainable land use that provides incomeopportunities from environmentallyfriendly options such as ecotourism, or-ganic farming, and shade coffee.

Improvingenvironmental healthTo guide interventions in the environ-mental health area, the linkages between

environment and health need to be iden-

tified and analyzed. Important research

priorities in the region include develop-

ment of health-environment project indi-

cators, as well as studies of the economic

benefits of reducing pollution. For ex-

ample, a recent Bank-funded study ana-

lyzed the economic benefits of efforts to

reduce emissions in the Mexico City Met-

ropolitan Area. The study found signifi-

cant economic benefits to meeting air

quality standards, including as much as

$6.8 billion per year for compliance with

ozone standards and $6.5 billion per year

for compliance with PM10 (particulate

matter) standards.

To address environmental health prob-

lems, the regional environment strategy

emphasizes the need to increase the effi-

ciency, effectiveness, and sustainability of

municipal services targeted to the poor.

In addition, it promotes clean industrial

production, including environmental

management systems in small- and me-

dium-sized enterprises.

Reducing vulnerabilityThe region has experienced several natu-ral disasters in recent years. The impactof these disasters has been aggravated byenvironmental degradation. In manycases, it is the poor who are most vulner-able to natural disasters. One approachto addressing these problems is to assistclients to better prepare for and respondto natural and human–induced disastersby developing early warning systems andrisk management services such as insur-ance schemes. Recent projects that havetaken this approach include the DisasterManagement Project in Mexico and theNatural Disaster Vulnerability Project inNicaragua. The Trinidad and TobagoWater Resources Management Strategydeals both with vulnerability to floods aswell as with quantity and quality of wa-ter (see Box, below).

THE PANAMA CASAND BIODIVERSITY—

TOWARD BEST PRACTICE

The fiscal 1999 Country AssistanceStrategy (CAS) for Panama focuses onpoverty alleviation and recognizes thatthis issue is particularly severe in ruralareas. Consequently, one of the pillarsof the strategy is environmentally sus-tainable development in rural areas.The proposed activities recognize thatPanama is home to a very rich andunique biodiversity, and that its conser-vation and sustainable use are neces-sary elements for such development.

In the past, Panama has used Bank as-sistance and GEF resources to en-hance its participation in theMesoamerican Biological Corridorthrough strengthening its capacity tomanage a large protected area system,to increase rural incomes and curtailenvironmental degradation, and to de-velop a National Biodiversity Strategyand Action Plan. The CAS emphasizesthe need to take these goals further andto address land tenure issues and policydistortions that provide incentives forunsustainable use of natural resources.In addition, it identifies the need to pro-tect the Panama Canal watershed, in-cluding the establishment of ecologicalreserves.

TRINIDAD AND TOBAGO

WATER RESOURCES

MANAGEMENT STRATEGY

The Water Resources ManagementStrategy has integrated several cross-sectoral issues, including the develop-ment of a water resources policy andinstitutional framework for the regula-tion of water resources; a water re-sources development planningframework, which will use surface wa-ter, groundwater, and desalinated wa-ter for municipal, industrial, andagricultural supply; a flood control strat-egy; and a pollution control and waterquality management strategy.

Recommendations include:! Implementing the concept of

integrated water resourcesmanagement

! Establishing an effective andfinancially autonomous institutionalframework that facilitates efficientwater resources management

! Acting to meet growing demand forwater

! Protecting environmental qualityand ecological systems

! Developing capacity and supporttools.


Anticipated changes in sea level will havea particularly serious impact on the sus-tainable development of low-lyingcoastal states of the Caribbean. A projectfinanced by the Global Environment Fa-cility (GEF) is designed to support Car-ibbean countries in preparing to copewith the adverse effects of climate change.

Addressing global issuesThe Bank continues to place a high prior-ity on addressing the global environmen-tal priorities of client countries bymainstreaming global financing instru-ments like the GEF and the Montreal Pro-tocol; utilizing programs supported bybilateral donors such as the ClimateChange Strategy Studies and GlobalOverlays programs; and by actively par-ticipating in targeted partnerships like thePilot Program to Conserve the BrazilianRain Forest and the Critical EcosystemPartnership Fund. The region has the

largest GEF medium-sized project pro-gram in the Bank. This program has en-couraged greater innovation in projectdesign and active engagement with a widevariety of nongovernmental partners.

Given the prevalence of worldwidebiodiversity hotspots in Latin America,biodiversity remains one of the region’shighest global environment priorities.Interventions aimed at preserving globalbiodiversity are more diverse than in thepast, and generally will become more in-tegrated into projects with wider sustain-able development objectives. The varietyof biodiversity projects include protectedareas management; sustainable use ofbiodiversity outside protected areas; con-servation of biodiversity through indig-enous peoples groups and NGOs;piloting of new economic instruments forfinancing and promoting biodiversitypreservation; and sustainable use of natu-ral resources in production landscapes.

C. Ca

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Population pressure and scarcity of agricultural land often force farmers to cultivate steep hillsides, as in thiswatershed in Colombia’s Cauca Valley.

S. Pa

giola

Every year, tens of millions of Monarch butterflies migrate to Mexico for the winter. However, deforestation isthreatening this vital part of the Monarch’s life cycle.

JULY 2000–JUNE 2001 • (FY2001) 39

LLLLL a t i n A m e r i c a a n d C a r i b b e a n Ra t i n A m e r i c a a n d C a r i b b e a n Ra t i n A m e r i c a a n d C a r i b b e a n Ra t i n A m e r i c a a n d C a r i b b e a n R e g i o ne g i o ne g i o ne g i o na t i n A m e r i c a a n d C a r i b b e a n R e g i o n

This article was prepared by Teresa Serra, (202)473-5754, fax (202) 676-9373, and Tom Lovejoy(202) 458-7837, of the Latin American andCaribbean Regional Office Environment Family.LCR website —http://wbln0018.worldbank.org/external/lac/lac.nsf

THE BIODIVERSITY OVERLAYS PROGRAM—FISHERIES MANAGEMENT

PLANNING AND BIODIVERSITY CONSERVATION IN ARGENTINA

Argentina’s coastal zone represents one of the richest and most productive temper-ate marine ecosystems in the world. Recent studies indicate that overfishing has notonly depleted local hake (Merluccius hubbsi) resources almost to the point of extinc-tion, but may have also adversely affected the marine mammals and birds that feedon these fish stocks, as well as the larger marine ecosystem on which they rely. Thisbiological diversity supports an important tourism industry along the Argentine coast.Unless the incentives that drive the fishing industry are changed, efforts to conservethis globally important marine biodiversity area are likely to fail, and the basis for asustainable tourism industry will be undermined.

At the request of the Government of Argentina, the Bank has assisted with a studythat would help evaluate the design and implementation of a fisheries managementplan (Individual Transferable Quotas) to limit the fishing effort in the hake and otherfisheries. An ecosystems/biodiversity overlay was added to this study to provide in-sights into the consequences of alternative strategies for fisheries management.

The expected major contribution of the overlay is to sensitize fishery policymakers tothe need for a comprehensive ecosystems approach to fisheries management and tohelp identify priority research needs to effectively support such an approach.

The Bank as a multilateral institutionplays an important role in helping ad-dress regional environmental issues suchas transboundary water management, re-source protection, and knowledgetransfer for common environmental man-agement challenges. Examples of regionalinitiatives include projects focused oncruise ship waste management in theCaribbean; coral reef protection andtransboundary corridor biodiversity pro-tection in Central America; and ground-water aquifer protection and large marinefisheries management in South America,such as the Biodiversity Overlays Pro-gram in Argentina (see Box, below). TheClean Air Initiative program was estab-lished to bring together municipal stake-holders to share experience andknowledge on improving urban air pol-lution. In concert with the urban air pro-gram, some interventions on thetransport side of the urban air pollutionchallenge are being tested with projectsfocused on land use pattern changes;modal and consumer behavior shifts; andtechnology upgrades.

Greater awareness of the impacts of cli-mate change, and the need to adapt more

vulnerable areas to impacts, has createdstrong demand within the region for ac-tions to address climate change and car-bon emission reduction objectives.Programs are under way to promote con-versions to low- or no-carbon renewableenergy technologies; encourage energyefficiency investments; and promote car-bon sequestration in wetlands, forests,and soils of both preserved and activelymanaged lands. Most climate change in-

vestments are being coupled with policy

reform measures to provide a better en-

abling environment for these invest-

ments, and in many cases are being

targeted at under-served poorer popula-

tions (for example, off-grid rural electri-

fication projects). The largest growth in

global programs is likely to occur in the

climate change area over the next decade.

Actions stemming from new interna-

tional conventions on persistent organic

pollutants (POPs) and biological safety in

food will also begin to be mainstreamed

into the Bank’s agricultural and urban

pollution work as global funding mecha-

nisms are more fully defined. The

Montreal Protocol Program, which has

been largely successful on the consumer

side in supporting technology change and

institutional strengthening, will begin to

shift its focus to target residual produc-

tion sites, in line with similar initiatives

across the world.

— ChileGuatemala—

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Cons

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Inter

natio

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The Middle East and North Africa in-

cludes 20 World Bank client coun-

tries with a combined population of290 million in 1999. The substantial investments made since

the 1960s on health, education, basic infrastructure services,

and more recently on family planning have begun to show

positive results. Between 1980 and 1999, population growth

declined from 3.2 to 2 percent annually; infant mortality

dropped from 95 to 44 per 1,000 live births; life expectancy

increased from 59 to 68 years; and secondary school enroll-

ment increased from 42 to 64 percent. From 1987 to 1998, the

proportion of the population living below $2 per day fell from

30 to 20 percent. However, the region still faces large income

gaps. On average, the richest 20 percent account for more than

45 percent of total income, while the poorest 20 percent ac-

count for less than 7 percent.

The Middle East and North Africa is the world’s richest re-gion in terms of oil and gas reserves, but the world’s poorestin renewable water and arable land. It continues to rely ex-cessively on natural resources as a development strategy.Water and oil are being tapped at unsustainable levels. Theregion’s countries have the following longstanding environ-mental issues:! Water scarcity and quality. Annual internal renewable water

resources per capita are declining in most countries (seeChart, top of next page). Water allocation is a majorconcern for governments. In part because of efforts toincrease food self-sufficiency, 88 percent of the region’swater resources are allocated to agricultural use,compared to 7 percent for domestic use. The degradationof water quality is also aggravating the water scarcityproblem.

! Land degradation and desertification. Less than 6 percent oftotal land area is suitable for agricultural use, and seriousland degradation and recurrent droughts are shrinking

Middle East and North Africa Region

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— Iran


JULY 2000–JUNE 2001 • (FY2001) 41

0

500

1,000

1,500

2,000

Iran

Cu

bic

mete

rsp

er

cap

ita

Iraq

Leba

non

Om

an

Moro

cco

Alger

ia

Djib

outi

Syria

Tunisia

Jord

an

Yem

en

Saud

i Ara

bia

Egypt

this area. Unsustainable agriculturalpractices on rainfed lands havecombined with natural factors—suchas wind and floods—to cause asubstantial loss of productive landand desertification.

! Coastal degradation. Major coastalcities are growing rapidly, andconstruction and pollution areplacing severe stresses on fragilecoastal ecosystems, a problemexacerbated by a lack of integratedcoastal zone management.

! Urban and industrial pollution. Urbanand industrial pollution causessignificant public health problems inthe region. The transport, industrial,and energy sectors contribute to thedegradation of air quality in majorurban cities. Proper solid wastedisposal is largely lacking, andindustrial hazardous waste is rarelytreated adequately.

! Weak institutional and legal frameworks.Environmental problems areaggravated by weak regulatory andenforcement mechanisms. Althoughthe region has made progress byestablishing ministries of theenvironment and preparing environ-mental legislation and NationalEnvironmental Action Plans(NEAPs), these institutions areunder-staffed, under-funded, andgenerally lack political power. Cross-sectoral linkages between ministries

and public institutions are generallyweak. The role of civil society inenvironmental management remainslimited.

More recently, the region’s countries havealso had to face the environmental dimen-sions of their own economic liberalizationefforts, of their free trade agreements withthe European Union, and of globalization.As countries move forward with trade lib-eralization and private sector develop-ment, the challenge is to assist them inthese transitions while ensuring a sustain-able use of their natural resources.

Regional environmentstrategyThe Bank first prepared a regional envi-

ronment strategy for the Middle East andNorth Africa in 1995. This strategy was amilestone in guiding countries, the do-nor community, and the Bank towardpromoting sustainable development inthe region. During the first five years of

the strategy’s implementation, invest-ments in environment-related projectstotaled $3.4 billion, including $2.3 billionallocated to water-related projects. Therewas notable progress in protecting natu-ral resources in Algeria, Egypt, Morocco,

and Tunisia. Efforts to control industrialpollution are ongoing in Algeria and

Egypt, and initiatives to reduce urbanpollution are being implemented in Leba-non, Tunisia, and Yemen. In Algeria,Egypt, and Morocco, projects are underway that would strengthen environmen-tal institutions and encourage greaterpublic participation. The MediterraneanEnvironmental Technical Assistance Pro-gram (METAP), sponsored by the WorldBank, EC, EIB, and UNDP, played a ma-jor role in evaluating national environ-mental strategies and helped establishenvironmental impact assessment unitsin various countries (see Box). Regionaltraining helped strengthen the capacityof environmental institutions.

Over the past year, the strategy has beenupdated for 2001-05, based on experiencegained since 1995, internal consultations,and external consultations with regionalstakeholders.

M i d d l e E a s t a n d N o r t h A f r i c a RM i d d l e E a s t a n d N o r t h A f r i c a RM i d d l e E a s t a n d N o r t h A f r i c a RM i d d l e E a s t a n d N o r t h A f r i c a RM i d d l e E a s t a n d N o r t h A f r i c a R e g i o ne g i o ne g i o ne g i o ne g i o n

STRENGTHENING EA CAPACITIES—THE METAP EXPERIENCE

To improve the business climate whileachieving sustainable economic devel-opment, clear and transparent environ-mental regulations and legal liabilitiesare needed.

In 1998, METAP initiated a program toassist Mediterranean basin countriesacquire the technical and policy toolsnecessary to establish EnvironmentalAssessment (EA)systems. EA systemsin Albania, Croatia, Egypt, Jordan, Tu-nisia, Turkey, and the West Bank andGaza were assessed, and the resultswere used to define actions to improvenational EA systems and to increasetheir coherence with internationalnorms. A second phase, initiated in2000, established an EA Center in Tu-nisia; extended the assessment of EAsystems to Algeria, Morocco, Lebanon,Syria, and Yemen; undertook collabo-rative workshops; and established anetwork of EA directors.

A third phase is now envisaged to testthe feasibility of establishing full com-pliance with World Bank EA proceduresso that responsibility for overseeing theEA process can be shared with nationalgovernments in selected countries.

Available internal renewable water resources are declining throughout the region

Source: World Resources 1994�95 and 1998�99.

1998

1992


The Bank’s strategic priorities and actionsfocus on three interrelated aspects of de-velopment—improving the quality of life,the quality of growth, and the quality ofthe regional and global environment.

Quality of lifeTo help improve the quality of life, thestrategy focuses on improving water re-source management, controlling land andcoastal zone degradation, and reducingurban air pollution.

Improving water resource management. Wa-ter scarcity and water quality stand outas particularly challenging issues in thismainly arid region. The Bank will:! Support integrated water resource

management, with an emphasis onwater-use efficiency

! Finance cost-effective sanitationmeasures and wastewater treatmentplants, and develop guidelines forwater re-use as well as hygieneeducation activities

! Integrate a water quality monitoringand enforcement component into allwater and wastewater-relatedprojects, and strengthen the in-volvement of local communities inthis monitoring process.

Controlling land and coastal zone degrada-tion. The Bank will establish reliablebaseline data for water and soil contami-nation from agricultural runoff and de-velop effective methods to controlagricultural pollution; improve landmanagement, and work with Bank-widenatural resources management networksto pursue a unified program on land man-agement; and provide a framework forthe participation of local communities inthe management of the natural resourcebase. Further, the Bank will supportcoastal zone management strategies andprograms that emphasize coordinatedmeasures and a preventive approach todegradation.

Reducing urban pollution. In order to im-

prove the quality of life in urban areas,

the Bank will concentrate on reducing air

pollution and improving waste manage-

ment. In the air pollution area, the Bank’s

strategy is to mainstream the environ-

ment into the energy and transport

sectors. It will do so by conducting en-

ergy-environment reviews; developing

environmental guidelines; and encourag-

ing the development of legal and insti-

tutional frameworks to address market

failures in the energy sector. In the trans-

port sector, the Bank will encourage the

phaseout of leaded gasoline, the imple-

mentation of public awareness cam-

paigns, and the introduction of inspection

and maintenance programs for vehicles.

In the waste management area, the Bank

will help develop the institutional and

legal frameworks necessary to support in-

tegrated waste management; introduce

affordable financing mechanisms for the

collection, treatment, and disposal of

waste; and increased awareness and the

participation of communities in all as-

pects of solid waste management.

Quality of growthThe Bank will support environmentallysustainable growth in the region throughcapacity building and strengthening theprivate sector. It will focus on strength-ening national legal frameworks to in-clude environment and social safeguards;improving self-monitoring and enforce-ment mechanisms; harmonizing nationalEA regulations with international norms(see Box, at right); working with the pub-lic and private sectors to promote cleantechnologies; increasing public consulta-tion and information dissemination;strengthening the role of governance inappropriate projects; involving NGOs,civil society, women, and communityleaders in the design and implementationof projects; and building the capacity ofinstitutions to develop early warning sys-tems and preparedness plans for floodsand droughts. Activities to improve theenvironmental capacity of the private sec-tor would be designed through METAPor the Development Grant Facility (DGF).Such activities would include assistingdomestic banks in managing the newrisks and exposures to environmental

— Yemen

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JULY 2000–JUNE 2001 • (FY2001) 43

regulations; providing reasonable andtransparent environmental regulationsthat support both environmental objec-tives and private sector development; andcontinuing the work on environment andtrade already started under METAP.

Quality of the regional and globalenvironmentTo promote the quality of the regional andglobal environment, the Bank will con-tinue to support its regional initiativesand will integrate global environmentalissues into its operations.

The Bank’s involvement in three regionalprograms—METAP, the DesertificationInitiative, and the Regional Water Initia-tive—will continue. METAP will remainthe major instrument for providing tech-nical assistance to strengthen the Bank’senvironmental interventions. The Bankwill also continue to strengthen partner-ships with regional and internationalagencies in designing and implementingits regional initiatives.

In the global environmental area, sixprojects that address greenhouse gas re-duction, three on biodiversity conserva-tion, and two on coastal zonemanagement are under preparation. NewGEF Operational Programs in transportand Integrated Ecosystem Managementoffer new opportunities to use GEF re-sources in transport, urban planning, andintegrated rural development projects. Amore systematic approach is needed tomainstream global environmental issues

M i d d l e E a s t a n d N o r t h A f r i c a RM i d d l e E a s t a n d N o r t h A f r i c a RM i d d l e E a s t a n d N o r t h A f r i c a RM i d d l e E a s t a n d N o r t h A f r i c a RM i d d l e E a s t a n d N o r t h A f r i c a R e g i o ne g i o ne g i o ne g i o ne g i o n

This article was prepared by Maria Sarraf of theMiddle East & North Africa Region’s RuralDevelopment, Water & Environment Group,(202) 473-0726, fax (202) 477-1374.MNA website —http://wbln0018.worldbank.org/mna/mena.nsf

THE COST OF ENVIRONMENTAL DEGRADATION INTHE MIDDLE EAST AND NORTH AFRICA

Under the METAP program, a project to assess the cost of environmental degrada-tion in the Region’s countries is currently under preparation. Employing the most re-cently available tools and methodologies from environmental economics, the projecthas two aims. The first is to assess the damage costs associated with environmentaldegradation. These damage costs could be regarded as benefits lost due to environ-mental inaction. The second is to estimate the replacement costs necessary to re-store the degraded environment. These two estimates will help policymakers toprioritize environmental interventions.

This analytical work has already started in Algeria, Egypt, and Tunisia, and is plannedto expand to include Lebanon, Jordan, and West Bank/Gaza.

into lending and nonlending activitiesand assist countries in meeting their com-mitments under international treaties andconventions. An analysis of the lendingprogram matched with country prioritiesshould be conducted to estimate the po-tential for GEF projects, establish priori-ties in every country, and develop anaction plan.

ImplementationarrangementsGiven the region’s diversity, actions toimplement this strategy update must bespecified at a country level. Bilateral grantfinancing will be instrumental in acceler-ating the implementation of these actions.

Mainstreaming the environment. Thefollowing four tools will be used to main-stream environment into the develop-ment agenda:1. Enhancing the quality and effec-

tiveness of countries’ environmentaland social assessments by strength-ening national project approvalsystems; introducing strategicenvironmental assessment of macro/micro economic policies and sectorenvironmental assessments (see Box,below); and training client countriesto use these assessments.

2. Demonstrating the economic impor-tance of a clean environment byundertaking studies to assess the costof environmental degradation (seeBox, below), and analytical work toidentify linkages between envi-

ronment and trade, environment andhealth, and environment and povertyreduction.

3. Integrating environmental compo-nents into targeted sectoral projects,and integrating global environmentissues into the Bank’s operations.

4. Developing Monitoring and Evalu-ation (M&E) systems and indicatorsto measure progress at the project,program, and policy levels. In orderto support the M&E systems, envi-ronmental profiles will be developedfor each country in the Region.

Partnerships. Partnerships will become animportant cornerstone for the Bank’s en-vironmental assistance in the Region andfor the implementation of the proposedstrategy. At the country level, the Bank isprepared to participate or convene a do-nor-country coordination group on envi-ronment to achieve a greater integrationof efforts and reduce overlaps. At the re-gional level, the Bank will seek collabo-ration between METAP activities andother regional organizations and NGOnetworks.

Selectivity. The Bank will re-focus someof its activities by gradually shifting fromstand-alone environment technical assis-tance (TA) projects to integrating environ-mental TA components into sectoroperations with well-defined outputs;discontinuing the preparation of addi-tional environment sector notes or NEAPupdates; and refocusing the functions andresponsibilities of the Region’s environ-ment staff toward providing upstreamtechnical and policy support; ensuringcompliance with the Bank’s environmentand social safeguard policies; and im-proving the implementation of environ-mental components in various projects.


For the past decade, South Asia has

been the second fastest growing re-

gion in the world, after East Asia. Yetthe region continues to face fundamental constraints on sus-tainable development. About 40 percent of the world’s poorlive in South Asia, mostly in rural areas. In spite of reformsdating to the early 1990s, countries in the region are still fac-ing fiscal imbalances; limited progress on trade liberalization;poor enabling and judicial environments for the private sec-tor; and lack of accountability of public institutions. Poor eco-nomic management is also reflected in the large subsidies andthe lack of economic pricing of natural resources, includingwater, energy, and agricultural land. In addition, many state-owned industries—for example, steel, fertilizer, and petro-chemicals, as well as private manufacturing industries suchas leather, textiles, sugar, and pulp and paper—have prosperedas a result of strong government protection policies and lack

of compliance with environmental regulation. In this context,reform agendas, including deregulation and fiscal efficiency,often conflict with political institutions and interests.

The region faces enormous environmental problems, includ-ing resource depletion and ecological degradation, indoor andurban air pollution; lack of access to clean water supplies andsanitation; toxic and hazardous agro-industrial waste genera-tion and disposal; and vulnerability to natural disasters. Theseproblems threaten the lives and livelihoods of millions ofpeople. Estimates suggest that premature deaths and illnesslinked to major environmental health risks account for onefifth of the total burden of disease in the region, a toll compa-rable to that of malnutrition (15 percent) and larger than thatfrom any other preventable risk factor. In India, inadequatewater supply and sanitation are estimated to account for 9percent, and indoor air pollution for 6 percent, of the envi-ronmental health burden. Air pollution causes approximately750,000 premature deaths annually in India, 160,000 in Paki-

South Asia Region


— IndiaC. Ca

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JULY 2000–JUNE 2001 • (FY2001) 45

stan, and 130,000 in Bangladesh, of whichabout 60 percent are from indoor air pol-lution.

Significant natural resource concerns inSouth Asia include water quality degra-dation and local and regional water scar-city; dwindling forests, coastal wetlands,freshwater bodies, and fisheries; soil deg-radation resulting from nutrient deple-tion and salinization; and poorlymanaged water resources. Observers notethat while many rural villages look simi-lar to how they looked decades ago, thesurrounding land degradation is oftenpervasive and severe.

South Asia stands out as the one regionof the world most vulnerable to naturaldisasters such as floods, cyclones, andearthquakes. Such disasters affect the re-gion regularly. From 1990 to 1998, the re-gion accounted for over 60 percent ofdisaster-related deaths worldwide, and inthe past two years, the Orissa cyclone andGujarat earthquake have claimed thou-sands of lives.

Improving the qualityof people�s livesBecause South Asia is among the mostpopulated and impoverished regions inthe world, our environment strategy fo-cuses foremost on improving the qualityof life of the poor by improving theirhealth and livelihood systems and reduc-ing their vulnerability to changes in en-vironmental conditions.

Our environmental health focus can beseen in three major areas. First, the Bankis supporting innovative analytical workon the role of environmental health fac-tors such as water supply and sanitationand reduced air pollution in achievingimproved household health. The researchfindings from work in Andhra Pradeshare guiding health and infrastructure

strategies across the region. Second, on-going work on urban air pollution is seek-ing the most cost-effective ways to reducepollution levels that are not only amongthe highest in the world, but are worsen-ing (see Box, below). Third, the extensivegroundwater arsenic contamination inBangladesh is eliciting a strong govern-ment and Bank-supported response, in-cluding mitigation, medical treatment,and community education.

In terms of livelihoods, our strategyplaces the highest priority in the areas ofwater resources and watershed manage-ment. In the absence of improved irriga-tion management, water conservation,and water harvesting in many arid anddegraded parts of South Asia, small-holder farmer livelihoods will fall to un-acceptable levels. Irrigation practices arefinancially unsustainable due to subsi-dies. Further, they are often also environ-mentally unsustainable due to land

salinization, waterlogging, and ground-water depletion. Watershed managementand land reclamation projects are impor-tant parts of the Bank-financed rural port-folio in Pakistan (along the Indus basin,and in Baluchistan) and India (see Box,top of page 46). Community forestry andforest rehabilitation activities have suc-ceeded in improving access of the ruralpoor to forest resources in India, particu-larly in Madhya Pradesh, and in Nepal.Fisheries and coastal area managementare important issues in Bangladesh,where several projects address the liveli-hoods and biodiversity aspects of waterresources management, as well as pro-mote greater coastal mangrove protectionto reduce the disastrous impacts of ma-jor cyclones.

Strategies for reducing vulnerability tonatural and environmental disasters in-clude support for changes in land-useplanning, disaster preparedness, commu-

S o u t h A s i a RS o u t h A s i a RS o u t h A s i a RS o u t h A s i a RS o u t h A s i a R e g i o ne g i o ne g i o ne g i o ne g i o n

REDUCING EMISSIONS BY TWO-STROKE ENGINES IN SOUTH ASIA

Urban air pollution is a leading cause of premature deaths in South Asian cities. Ve-hicles with two-stroke engines, which are half of all vehicles, contribute significantlyto the problem. Two- and three-wheelers with two-stroke engines are popular be-cause they are cheaper than their four-stroke engine equivalents. However, they arealso a significant source of fine particulate emissions, the most damaging type ofairborne pollutants—responsible for about 200,000 premature deaths per year in SouthAsian cities. Some steps have already been taken to address the problem by ban-ning certain older vehicles, introducing cleaner engine types, and introducing somecleaner lubricants and fuels. For example, compressed natural gas (CNG) has beenintroduced in New Delhi. Still, it is important to understand the cost-effectiveness andfeasibility of introducing different types of measures to reduce fine particulate emis-sions.

A recent World Bank report, Improving Urban Air Quality in South Asia by ReducingEmissions from Two-Stroke Engine Vehicles, analyzes different technical and policyoptions for reducing emissions from two-stroke engines. Two immediate simple solu-tions—using the correct type and concentration of lubricant and carrying out regularmaintenance—would significantly reduce emissions from two-stroke engines whilesaving drivers money. As for new vehicles, introducing price and trade policies toencourage a switch to four-stroke engine vehicles, as well as installing catalytic con-verters, would greatly reduce tailpipe emissions. Finally, a strong public awarenesscampaign—involving industry, government, unions, and others—to promote these mea-sures is needed. The newly approved Air Quality Management Project in Bangladeshis actively engaged in the implementation of these strategies in Dhaka, as are severalactivities in India (including the air quality management component of the Environ-mental Management Capacity-Building Project and the Mumbai Urban TransportProject) and a region-wide air quality initiative funded by ESMAP.


nity involvement and education, waterconservation and management, buildingcodes, and emergency-phase interven-tions. Through activities related to cy-clones, coastal flooding, and earthquakesin Bangladesh and India (Orissa, AndhraPradesh, and Gujarat), we are also inten-sifying our work on social protectionmeasures to protect people who are vul-nerable to natural disasters.

Improving the qualityof growthSince equitable and sustainable economicgrowth remains essential for substantiallyimproving the quality of life of the poor,our strategy supports policies and invest-ments that support quality growth. At-tention to environmental and socialimpacts play a strong role in ensuring thesustainability not only of World Bank-fi-nanced projects, but of all investment ac-tivities in a country. The shift in Banklending operations toward a greater em-phasis on programmatic lending has ex-

panded the Bank’s role in achieving bet-ter environmental information, monitor-ing, and enforcement, through bothprojects and policy dialogue (see Box, atright). In addition, adequate safeguardsare essential to ensuring quality ofgrowth, in addition to the promotion ofstrategic sectoral and regional environ-mental assessments. Examples includesectoral assessments for energy reformprojects in India and regional assessmentsfor watershed and social fund projects inPakistan, India, and Bangladesh. In ad-dition, more attention is being given tointegrating social and environmental as-sessments because of the intertwined na-ture of the issues involved. Combinedenvironmental and social sectoral assess-ments for transport, urban, and rural de-velopment projects are now routinelybeing conducted in South Asia. Further-more, there is increasing emphasis onenvironmental monitoring and evalua-tion, taking advantage of improved infor-mation management tools and humanresources. Finally, the Bank is placing astrong emphasis on local ownership and

SUSTAINABLE WATERSHED MANAGEMENT IN INDIA

The South Asia Region is implementing a new generation of Natural Resource Man-agement (NRM) projects focusing on the needs of the poor living on marginal landsand degraded watersheds. These projects integrate community-led development withinnovative social, technical, scientific, and Geographic Information System (GIS)-basedmonitoring and evaluation approaches.

The Integrated Watershed Development Project (Hills II) in India uses participatoryapproaches to increase productive potential and promote sustainable watershed man-agement in five Indian states (Haryana, Himachal Pradesh, Jammu and Kashmir,Punjab, and Uttar Pradesh) in the fragile and highly degraded Shivaliks Hills. Theproject covers 2,000 villages in a 200,000-hectare area. Village development com-mittees (VDCs) have been formed and given the responsibility for identifying andimplementing priority watershed interventions in their villages. Project activities in-clude micro-watershed treatments such as vegetative barriers, improved croppingsystems, horticulture, and silvipasture; fodder and livestock development (artificialinsemination for genetic improvement; veterinary health improvement; and fodderproduction); and rural infrastructure.

The medium-to-long-term aim of these investments is to improve rural livelihoodsthrough stronger community management of natural resources on a sustainable ba-sis. Some villages are already experiencing increased water availability, reduced soilerosion, improved vegetative and forest cover, higher crop and horticulture yields,and increased milk production. Project activities also help reduce risks from naturaland environmental disasters. For example, improved water management reduces vul-nerability to droughts.

FOCUS STATES IN INDIA

The Bank’s recent Country AssistanceStrategy for India continues its “focus-state approach,” begun about threeyears ago. Under this program, focusstates enter into a targeted program ofstructural adjustment operations thataddress fiscal and governance reforms.Under a successful reform scenario,reforming states also receive substan-tial assistance through sector invest-ment loans. The three current focusstates are Uttar Pradesh, AndhraPradesh, and Karnataka.

The incorporation of environmental con-cerns into the focus-state approach isbased on three main operational strat-egies:! Strengthening the environment

agencies to address both (a) thespecific environment-related issuesarising out of the Bank’s focus stateprogram, such as power sectorreform or watershed managementissues, and (b) other priority en-vironmental issues that directlyimpede poverty reduction, such asweak enforcement of pollutionregulations.

! Mainstreaming the environment byagreeing with task teams on areaswhere environment-related inputswould help focus sectoral projectson poverty outcomes, such ashealth, livelihoods, and vulnerability.The environment-related discus-sions may well be cross-sectoral,such as in the example of ruralhealth, which brings together issuesnot only in the health sector, but ininfrastructure, education, andenergy.

! Achieving efficiencies across theWorld Bank program—and poten-tially across other investmentactivities being undertaken by thestate government in applyingthe Bank’s safeguard policies—byfor example using sectoral andregional environment assessmentmethodologies that look morebroadly at issues than would be thecase for single project assessments.

JULY 2000–JUNE 2001 • (FY2001) 47

S o u t h A s i a RS o u t h A s i a RS o u t h A s i a RS o u t h A s i a RS o u t h A s i a R e g i o ne g i o ne g i o ne g i o ne g i o n

This article was prepared by Carter Brandon ofthe South Asia Environment Sector Unit, (202)458-2752, fax (202) 522-1664. SAR website —http://wbln1018.worldbank.org/sar/sa.nsf

capacity building among its clients inSouth Asia to help them strengthen theirenvironmental safeguard systems andpractices.

Enhancing the qualityof the global andregional commonsThe degradation of the region’s globalcommons can constrain economic devel-opment because of its huge opportunitycost and threat to political security. Theregion’s water resource systems, for ex-ample, are highly interdependent. Ourfocus is on achieving global environmen-tal objectives as a byproduct of promot-ing local development benefits.! The management of shared river

basins and seas poses an importantchallenge for South Asia. The Bankhas been involved in the past inhelping to facilitate a robustagreement between India andPakistan on the Indus River basin.The region would derive substantialbenefits from greater cooperationamong riparians on otherinternationally shared river basins,primarily the Ganges-Brahmaputra-Meghna basin.

! South Asia is poised to become amajor contributor to greenhouse gas(GHG) emissions. Although percapita emissions in the region arecurrently very low, with totalproduction of carbon dioxiderepresenting only about 5 percent ofglobal emissions, they are increasingabout 7 percent per year—twice theworld average. To reduce the growthin GHG emissions, continued powersector reform—with widespreadefficiency gains in transmission,distribution, and end-use—andcontinued sector reform is required.In addition, opportunities exist forfurther renewable energy use by

rural and urban communities andindustrial users. Small-scalerenewable energy supplies may bethe most cost-effective solution toproviding reliable electricity in ruralareas not connected to the grid. Theregion is also particularly vulnerableto the impacts of climate changebecause of its extensive low-lyingcoastal areas. A recently completedstudy on climate change adaptationin Bangladesh found that thefinancial cost of adaptation isrelatively low given that many of theplanning and investment prioritiesare consistent with developmentpractices and priorities that havealready been identified.

! The custodians of South Asia’sbiodiversity are largely the ruralpoor, who often depend directly onthese resources for their livelihoodand sustenance. Our efforts focus on

(a) finding effective mechanisms tochannel available global resources tolocal communities in order toprovide adequate incentives tochange patterns of resource use, and(b) broadening the scope of the GEFportfolio to promote biodiversityconservation over whole land-scapes.

! The ongoing Montreal ProtocolProgram in South Asia has continuedto expand. In India, approximately3,000 tons of ODS chemicals havebeen phased out. In addition, a majorinitiative to phase out production ofall CFCs in India (one of the world’slargest remaining producers of thesechemicals) began implementation in2000.

S. Sc

hulze— Nepal


A s the World Bank’s

private investment

arm and the world’s

largest multilateral source of

loan and equity financing for

private investments in devel-

oping countries, the Interna-

tional Finance Corporation

(IFC) is determined to play a

lead role in the drive for sus-

tainable private sector invest-

ment. Founded in 1956 and

owned collectively by its 175

member countries, IFC is a glo-

bal investor and advisor that

promotes sustainable projects

that are economically viable, fi-

nancially and commercially

sound, and environmentally

and socially responsible. IFC

believes that economic growth

is crucial to poverty reduction;

that such growth is grounded

in the development of entre-

preneurship and successful

private investment; and that a

conducive business environ-

ment is needed for private

businesses to thrive and con-

tribute to improving people’s

lives in developing countries.

How does IFC do this? IFCleads by example by:! Taking educated risks—

IFC’s investments infrontier sectors and coun-tries have long had both asolid catalytic role and astrong demonstrationeffect

! Adding value through acore commitment topromoting high environ-mental and social stan-dards in all of our projectsand by listening activelyto stakeholders and theirconcerns

! Recognizing, in everyinvestment, the value ofsound corporate gover-nance structures

! Seeking to be transparent,accountable, and equitablein the development pro-cess.

IFC�s managementsystem forenvironmental andsocial issues ininvestmentsIFC’s approach to environmen-

tal and social issues in project

financing is evolving from en-

suring compliance to the de-

velopment of a sustainable

development strategy. To en-

sure compliance and account-

ability, IFC has developed a

number of integral manage-

ment components for its in-

vestments and activities.

IFC has a well-developed pol-

icy and procedural framework.

Its environmental and social

safeguard policies are closely

harmonized with those of the

World Bank, with minor ad-

justments to adapt them to

IFC’s private sector context.

IFC also adheres to a policy

against Harmful Child Labor

and Forced Labor. IFC applies

the World Bank Group’s Pollu-

tion Prevention and Abatement

Handbook (1998) to its invest-

ments, with high-level man-

agement clearance required for

any variation. To provide guid-

ance for sectors for which no

uilding auilding auilding auilding auilding aSustainableSustainableSustainableSustainable

DevelopmentDevelopmentDevelopmentDevelopmentRRRRoadmapoadmapoadmapoadmap

SustainableDevelopment

RoadmapIFC�s Strategy to

Ensure Environmental andSocial Responsibility

B

“I strongly believe that

private sector investment

and sustainable growth in the

developing world is fundamental

to achieving greater equity in

the development process.”

Peter L. Woicke,Executive Vice President, IFC

JULY 2000–JUNE 2001 • (FY2001) 49

I F C

guideline is available in the

Handbook, IFC has developed

its own guidelines, including

worker health and safety

guidelines.

IFC’s Environmental and So-

cial Review Procedure (ESRP)

guides IFC staff in the applica-

tion of the policy and guideline

framework to environmental

and social analysis of IFC

projects. The ESRP, adopted in

1998, contains important de-

velopments in IFC’s approach

to financial intermediary in-

vestments, local public consul-

tation and disclosure require-

ments, and the improved

integration of social analysis

into the environmental assess-

ment process. These require-

ments are integrated fully into

IFC’s business processes and

project cycle.

IFC management continues to

support building significant

environmental and social man-

agement and review capacity.

IFC believes that environmen-

tal and social issues are equal-

which commit IFC’s cli-

ents to comply with IFC’s

safeguard policies and

guidelines and, where

appropriate, to follow a

specific action program to

ensure compliance; and

monitoring of environ-

mental and social perfor-

mance of projects as part

of IFC’s overall portfolio

supervision.

ly important, that they are

mutually supportive, and that

they benefit from joint man-

agement oversight. A direct

reporting line continues from

the director of the Environ-

ment and Social Development

Department to the executive

vice president of IFC. This re-

porting framework ensures in-

dependence from operational

line management, as does a

single clearance function.

With the addition of more en-

vironmental and social review

staff, IFC has developed and

implemented a Quality Project

Management system, which

ensures that specialists have

access to the appropriate man-

agement tools to make in-

formed decisions and to

promote consistency in project

processing. An internal audit

program regularly reviews the

performance of both the sys-

tem and the individual project

managers. IFC also applies a

risk rating to apportion super-

vision resources to the highest

priority areas.

IFC works closely with its cli-ents to ensure compliance withsafeguard policies and pollu-tion standards. This is donethrough a number of manage-ment tools, including:! Management and/or action

plans (for example, forenvironmental manage-ment, resettlement, orcorrective action)

! Environmental and socialconditionalities in projectinvestment agreements,

To ensure compliance with IFC and World Bank environmental guidelines,Tashkent-based Elma Cheese—an Uzbek-Dutch joint venture—trains itsworkers in occupational health and safety standards and has built its ownwastewater treatment plant.

IFC’s status as a public insti-

tution requires that it establish

a significant mechanism for ac-

countability to its member

countries and civil society, par-

ticularly with respect to its en-

vironmental and social per-

formance. Perhaps the most in-

novative aspect of IFC’s envi-

ronmental and social accounta-

bility is the establishment of a

Compliance Advisor/Om-

budsman (CAO)—an account-

ability office designed to

provide non-judicial, practical,

problem-solving approaches to

contentious aspects of projects.

This office is fully independent

of the managements of IFC and

the Multilateral Investment

Guarantee Agency (MIGA)

and reports directly to the pres-

ident of the World Bank

Group. The current CAO is

Meg Taylor of Papua New

Guinea. The CAO has three

roles:

IFC


! Responding to complaintsby persons affected byprojects and attempting toresolve the issues, using aflexible, problem-solvingapproach

! Providing independentadvice to the presidentand senior management ofIFC and MIGA

! Overseeing audits of IFC’sand MIGA’s environmen-tal and social perfor-mance, both on systemicissues and in relation tosensitive projects.

The CAO Office receives inputand feedback through its Ref-erence Group comprisingNGOs and civil society, busi-ness and industry, and IFC/MIGA management.

IFC recognizes the importanceof maximum transparency andsolicits feedback to improve onits performance. IFC relies onits disclosure policy and pub-lic consultation standards toensure that interested partieshave an opportunity to beheard and to exert influencewith respect to specific projectsand policies. IFC receives on-going feedback and evaluationinternally from its Operations

Evaluation Group and through

CAO investigations and ad-

vice. IFC also welcomes and

receives feedback from exter-

nally interested parties, includ-

ing civil society and NGOs.

IFC andenvironmentalprojectsIn addition to seeking to miti-

gate and manage the impactsof its traditional projects, IFChas established units withinseveral investment depart-ments to focus on identifying,structuring, and financing en-vironmental projects. Exam-ples include the Utilities Groupwithin IFC’s Infrastructure

Department, which financeswater, wastewater, and solidwaste management projects;and IFC’s Renewable Energyand Energy Efficiency Team,which is housed in IFC’s Pow-er Department.

In 1996, IFC created the Envi-ronmental Projects Unit to actas a catalyst and incubator forprojects with specific environ-mental benefits and goals. Indeveloping projects for IFC’sown account, this unit—nowrenamed the EnvironmentalMarkets Group—operates as acost center that provides tech-nical analysis and financialstructuring services to prepareprojects for funding by the rel-evant investment depart-ments. More recently, theEnvironmental Markets Grouphas begun to encourage theidentification and implementa-tion of eco-efficiency improve-ments in mainstream IFCprojects. In supporting projectswith environmental benefits,

the group draws on IFC’s owninvestment resources and,where appropriate, conces-sional funding from sourcessuch as the Global Environ-ment Facility. The Environ-mental Markets Group alsoundertakes special initiativessuch as identifying projects toreduce greenhouse gas emis-sions under the Kyoto Proto-col.

Looking ahead �The transition tosustainabilityIFC is launching a sustainabil-ity initiative that has the poten-tial to significantly increase thedevelopment impact of its pri-vate sector investment activi-ties. Sustainability for IFCmeans incorporating a moreopportunistic, added-value,market incentive-oriented ap-proach to complementing theexisting regulatory-based ap-proaches embedded in oursafeguard policies.

IFC’s investment in South Africa’s Spier Estate—a refurbished combination of winery, hotel, and conference center—demonstrates its commitment to sustainable development. Local communities share in Spier’s vision. An organic farmingproject is underway that aims at helping previously landless black farmers run their own operation.

FOR ADDITIONAL INFORMATION

A full list of IFC’s environmental and social policies, guidelines,ESRP and publications is available at http://www.ifc.org/enviro/

Information on the IFC/MIGA Compliance Advisor/Ombudsman(CAO): http://www.ifc.org/cao/

Environmental Projects Unit (EPU) activities: http://www.ifc.org/epu/

SSSSSO U T HO U T HO U T HO U T H A A A AF R I CF R I CF R I CF R I C AAAA �� SSSSO U T H AF R I C A � SSpier EstateSpier EstateSpier EstateSpier EstateSpier EstateSpier EstateSpier EstateSpier EstateSpier EstateSpier Estate

S. Mi

ller

JULY 2001–JUNE 2001 • (FY2001) 51

I F C

This article was prepared by ShawnMiller of IFC’s Corporate RelationsUnit (202) 473-1404, fax (202) 974-4384, and Glen Armstrong of IFC’sEnvironment and Social Develop-ment Department (202) 473-7038,fax (202) 974-4389 and is based onIFC’s contribution to the WorldBank’s Environment Strategy.

As it moves beyond compli-ance, IFC will not compromiseits minimum standards. Rath-er, it recognizes that achievingan appropriate balance amongthe financial, economic, social,and environmental dimen-sions of sustainability will de-pend on the circumstances andlocality of the particular invest-ment. This is not a one-size-fits-all philosophy, but anintention to operationalize sus-tainable development in a waythat maximizes IFC’s overalldevelopment impact and role.

The sustainability initiativewill encompass all the majorcomponents of IFC’s opera-tions. In its core investmentbusiness, work is underway toidentify the significance of en-vironmental, social, and gov-ernance factors in sectorinvestment strategies. At thetransaction level, we are ex-ploring ways to equip invest-ment teams to bring addedvalue to our clients in theseareas, while also ensuring thatthey reap maximum businessbenefit. This requires a sophis-ticated understanding of thecause and effect of these factorson business performance inemerging markets, and an abil-ity to transfer emerging privatesector sustainable practicesinto the developing countrycontext of its operations—alogical and evolutionary exten-sion of IFC’s traditional role inensuring financial and eco-nomic sustainability.

Work is also underway to care-fully identify IFC’s role and

responsibility as a lead invest-ment organization in the de-veloping world and inidentifying the key impacts ofits physical operations or“footprint.”

A primary focus will be onhow actions that create envi-ronmental or social value orimprove corporate governancecan also create financial valuefor IFC’s clients. This financialvalue can take the form of:! Tangible cost reductions,

through eco-efficiency orcleaner technology

! Improved revenues, throughbetter access to globalmarkets, securing supplychains, or market differen-tiation and “branding”

! Reduced risks, through,for example, strengthenedand positive interactionswith local communities

! Better access to financing! Access to intellectual capi-

tal and innovation throughstaff attraction and reten-tion.

We believe that sustainablebusiness practices convergewith good management andthat, as a result, sustainablebusinesses will be the long-term winners. As investors,maximizing long-term share-holder value is one of ourgoals. It simply makes com-mercial sense: any businessthat puts its supply chain atrisk or ignores reputational is-sues is not acting in the inter-ests of its shareholders orbottom line, let alone otherstakeholders.

This is an area in which IFC hasemerged as an importantchange agent among the pri-vate sector investment institu-tions operating in thedeveloping world. Our adviceis sought by other internation-al financial institutions, com-mercial banks, and thebusiness community at large.IFC guidance documents onthe value of public consulta-tion and community develop-ment are publications that arewidely referred to by practitio-ners and businesses.

The building blocks of thistransition are currently beingput in place through internaldiscussions, and substantiveconsultations with all stake-holders are expected to com-mence in late 2001.

We believe that the journey to-ward sustainability will bring

many benefits to IFC’s clients.Furthermore, we believe that itwill also benefit IFC by:! Differentiating IFC from

other financial institutionsin our ability to add value

! Motivating our staff! Allowing us to operate in

high-risk areas with re-newed confidence in ourrole and ability to achievesustainable outcomes

! Contributing positively toIFC’s mission to reducepoverty and improvepeople’s lives.

IFC provides valued advice andguidance—such as the recentlypublished Community DevelopmentGuide—to its clients and the privatesector generally.


NewsUpdates!

The August 2001 meeting of the parties to the Framework Convention on Climate Change andthe Kyoto Protocol in Bonn had significant implications for the World Bank and its clients.

With the exception of the United States, all parties approved a number of core elements at theBonn meeting. There was agreement on flexibility mechanisms; land use, land use change,and forestry activities; funding for developing countries; and compliance.

Flexibility mechanisms can be used to augment a country�s �significant� domestic actions toreduce greenhouse gas emissions. Since 1999, the World Bank�s Prototype Carbon Fund (PCF)has explored how such mechanisms might work. Companies and governments have contrib-uted financially to the PCF, which then uses Fund resources to support projects designed to

KyotoProtocol �Implicationsof Bonn

!

EnvironmentWeek

The World Bank�s Environment Week annually sponsors training sessions, debates, and openmeetings for its staff and interested groups. This year, events were spread throughout themonth of June, vastly increasing outreach to internal and external audiences.

The event was launched with a keynote address by eminent scientist, environmentalist, andbroadcaster David Suzuki on �Economics and Ecology: Setting the Real Bottom Line.�

Workshops, many of which were open to the public, focused on specific topics, includinglessons from the environmental performance review conducted by the Bank�s OperationsEvaluation Department; the World Bank�s Environment Strategy; work in the regions; persis-tent organic pollutants (POPs); and strategies to combat air pollution.

There were several panel discussions. A panel on biodiversity conservation in the 21st Cen-tury was chaired by Peter Seligmann, CEO of Conservation International, and included BankPresident James D. Wolfensohn; Tom Lovejoy, chief biodiversity advisor at the Bank; OrinSmith, CEO of Starbucks; and Edward O. Wilson of Harvard University. Another panel,which was chaired by Environment Department Director Kristalina Georgieva, focused onthe implications of climate change for sustainable development�globally and in the Bank�sclient countries. It included Bob Watson, World Bank chief scientist; Svend Auken, Denmark�sMinister of Environment and Energy; Robert O. Mendelsohn, Yale University; David Victor,Council on Foreign Relations, New York; Michael Grubb, Royal Institute of InternationalAffairs, UK; Atiq Rahman, Bangladesh Centre for Advanced Studies; and Benito Mueller,Oxford University.

This year�s events also included a significant community outreach component. On June 25,2001, over 200 World Bank volunteers spent the day removing trash and debris from twoneglected islands in the Anacostia River in Washington, D.C. Joined by Bank President JamesD. Wolfensohn, D.C. Mayor Anthony Williams, representatives from the Mayor�s office, andlocal NGOs, the volunteers endured heat, humidity, and persistent mosquitoes to clean upKingman and Heritage Islands. They managed to haul away more than 8 tons of garbage. Thecleanup was another step in D.C.�s plan to restore the islands as part of the larger AnacostiaWaterfront Initiative. The Anacostia Watershed Society applied for a grant through the Bank�sCommunity Outreach Grants Program in April, and was awarded $15,000 to aid in its resto-ration efforts.

World Bank staff member, Maria Sarraf,helps to clean up Anacostia River’sKingman Island.

D. C

ampo

sD.

Cam

pos

On hand to lend help and give moralsupport were Kristalina Georgieva,Director, Environment Department,World Bank; Robert Boone, President,Anacostia Watershed Society; JamesWolfensohn, President, World Bank;and Washington D.C.’s Mayor, AnthonyWilliams.

JULY 2001–JUNE 2001 • (FY2001) 53

N E W S U P D A T E S

Through the Nile Basin Initiative (NBI), the World Bank is taking an active role in facilitatingregional cooperation in the management of a major transboundary resource. The Nile Basincovers 10 countries and is characterized by extreme poverty, instability, rapid populationgrowth, and environmental degradation. Urgent environmental issues include aquatic weedinfestations, soil erosion, and sedimentation. Established in 1999, the NBI represents the firsttime in history that all 10 nations have come together to discuss common goals on how bestto fight poverty in the region and achieve sustainable development through the equitableutilization of the Nile Basin�s water resources.

In June 2001 in Geneva, international donors, development agencies, and representativesfrom the Nile�s 10 riparian countries met to pledge financial and political support to the NBI.The meeting in Geneva was the first working session for the International Consortium forCooperation on the Nile (ICCON) and also marked the launch of the newly formed ICCONConsultative Group, which is chaired by the World Bank�s Vice President for Africa, CallistoMadavo, and Vice President for the Middle East and North Africa, Jean-Louis Sarbib. The

Nile BasinInitiative

!

produce emissions reductions that are consistent with the emerging framework for Joint Imple-mentation (JI) and the Kyoto Protocol�s Clean Development Mechanism (CDM). Participantsin the PCF receive a share of the emission reductions, which are verified and certified inaccordance with carbon purchase agreements reached with the respective countries �hosting�the projects, and used toward their Protocol obligations.

It was agreed that industrialized countries could adopt afforestation, reforestation, forest,grassland, and agricultural land management activities as part of their domestic actions tomeet their commitments. Within this framework, caps were negotiated for the amount ofcredit that a country can claim from forest management activities. The amounts of the coun-try-specific caps continue to be a point of friction in the negotiations. For the first commit-ment period from 2008 to 2012, only afforestation and reforestation activities will be eligiblefor CDM projects in developing countries. The total credit that an industrialized country canclaim from such activities has been limited to 1 percent of its GHG emissions in 1990.

In the funding area, three new funds have been established to help developing countries. TheSpecial Climate Change Fund will be available to developing countries to address adaptation,technology transfer, emissions reductions, and economic diversification. The Least Devel-oped Country Fund will help the poorest countries establish national adaptation programs.The Kyoto Protocol Adaptation Fund will support �concrete� adaptation projects and pro-grams. All three funds are to be managed by the Global Environment Facility (GEF). TheEuropean Union, Canada, Iceland, New Zealand, Norway, and Switzerland already havecommitted to providing $410 million per year by 2005, which includes their GEF replenish-ment contributions, for climate change activities.

In the compliance area, it was agreed that there will be no financial penalty for noncompli-ance. However, a penalty of 1.3 times the shortfall in achieving the reduction goal of the firstcommitment period will be added to the reduction that has to be achieved in the subsequentcommitment period. The legally binding nature of this penalty for noncompliance is stillunder discussion.

The Nile River.

Wor

ld B

ank

S. Pa

giola

Destruction of tropical forests in Petén,Guatemala.


The Critical Ecosystem Partnership Fund (CEPF) took another major step forward in June 2001when the John D. and Catherine T. MacArthur Foundation awarded the Fund a grant of $25million.

Launched in August 2000, the CEPF focuses on biodiversity hotspots, highly threatened re-gions where an estimated 60 percent of all terrestrial species are found within only 1.4percent of the planet�s land surface. In addition to the MacArthur Foundation, the members ofthe Fund are Conservation International, the Global Environment Facility, and the WorldBank. The new grant brings the assets of the Fund to $100 million. The Fund�s goal is $150million. The grant from MacArthur was made to Conservation International, the managingpartner of the CEPF.

The CEPF provides financial support, technical expertise, field knowledge, and information tomostly nonprofit organizations working to conserve biodiversity in developing countries. TheCEPF Donor Council thus far has approved the spending of more than $11 million in grantresources, divided among priority areas in West Africa, Madagascar, and the Vilcabamba-Amboró corridor straddling Peru and Bolivia.

!

Duke

Uni

versi

ty P

rimat

e Cen

ter

program for the Nile includes implementation of a basin-wide program of research, capacitybuilding, and technical assistance, as well as the detailed preparation of cooperative sub-basin investment programs in the Eastern Nile and the Equatorial Lakes regions. The firstphase of this investment program is anticipated to amount to about $3 billion. The develop-ment partners expressed initial financial support of at least $140 million to finance the fullprogram.

For more information: http://www.worldbank.org/afr/nilebasin

In September 2002, the 10-year follow-up to the 1992 Rio Summit will take place inJohannesburg, South Africa. The overall goal of the Rio+10 Summit will be to review achieve-ments since 1992 and attempt to regenerate the global commitment to sustainable develop-ment and action on Agenda 21.

The Bank is expected to play a significant role, both in the preparatory process and at theSummit itself. The Bank�s contributions to the upcoming Summit include several key ele-ments:

! The 2002/3 World Development Report�Sustainable Development with a DynamicEconomy�will explore how poverty and marginality are closely associated with fragileecosystems and stressed social structures.

! Technical background papers on the Bank�s strategic directions for the future, such asmeasuring and financing sustainable development, poverty and environment, food se-curity and natural resource management.

! WBI activities include (a) a new Global Dialogue on Sustainable Development series,which will focus on topics high on the Johannesburg agenda; (b) a collaboration withGLOBE, in a series of workshops for parliamentarians that will enable participants totake an active role in the preparatory process; and (c) special training programs, courses,and policy services on Summit-related topics.

! Preparations forRio+10

$25 milliongrant for criticalecosystems

Sifaka lemur, Madagascar. More than a dozen species of lemur, most of which are endemic to Madagascar, areconsidered vulnerable, endangered, or critically threatened.

Wor

ld B

ank

JULY 2001–JUNE 2001 • (FY2001) 55

N E W S U P D A T E S

Greening theBank

! In addition to helping its clients improve their environmental performance, the World BankGroup has examined its own activities and is working to reduce its environmental �footprint.�

�Greening the Bank Group� was the subject of a letter to all staff from Bank President JamesWolfensohn in September 1996. The letter called for specific steps to be taken, including anannual independent environmental audit of the World Bank Group to monitor progress andcompare the Bank�s efforts to other similar organizations. The first such audit, conducted in1998, was co-funded by the World Bank Staff Association. The audit�s results have guidedconservation efforts, which have also benefited from active staff involvement and suggestionsthrough the Staff Association�s Environmental Working Group (EWG). Efforts have covered arange of physical plant and other workplace environmental issues. Notable achievementsinclude:

! Substantially increasing the proportion of the Bank�s waste that is recycled.

! Reducing paper use by increased use of electronic communication and record-keeping.and by procuring printers with double-sided printing capability.

! Promoting a transition from incandescent light bulbs to fluorescents, and then to com-pact fluorescent (CF) lighting, thus significantly reducing energy use. Use of light-sensi-tive dimmable CFs that provide the required number of foot-candles of light on the worksurface using less electricity in daytime are being piloted in one of the Bank�s building.

! Providing more parking, lockers, and shower facilities for staff bicycling to work.

! Making fair-trade coffee available in Bank cafeterias.

There have also been numerous individual initiatives. For example, in the spring of 2001 theStyrofoam packing materials from 10,000 new computers the Bank had ordered were destinedfor a landfill. Bank staffers found a Pennsylvania company that was willing to pick up thematerial in Washington. The company grinds up the material and uses it in repaving stateroads. The transportation costs were about $900 more than the payment to the Bank for theStyrofoam. The Bank�s Information Solutions Group agreed to pay for the transportation of theStyrofoam. The Bank�s General Services Department then quickly mobilized to find enoughstorage space to handle a large truckload of foam. GSD staff also removed any tape or otherextraneous materials, so that the recycler would accept the foam. In the end, three largetrailer truckloads of foam were recycled.

Greening topics addressed are enormously broad, from reusable chopsticks and labelinghydrogenated oils in the cafeteria; to planting trees around the Bank�s main complex; torelaxing the dress code to reduce cooling and heating costs. Numerous additional measuresare under study, including participation in Metrochek, the Washington area�s transit incen-tive program, which provides a monthly financial rebate to area employees to use masstransit; implementing Energy Star features on personal computers throughout the Bank; andfurther improving waste separation. Efforts on green procurement are also ongoing (seeEnvironment Matters 2000).

0

200

400

600

800

1,000

1,200

FY96 FY01

. . . and recyclingof paper has increased

Tota

l Ton

nage

0

500

1,000

1,500

2,000

2,500

FY96 FY01

Waste generatedby the World Bank

Group at Headquartershas diminishedsubstantially . . .

Tota

l Ton

nage

! Additionally, Bank senior management and technical staff will participate in five re-gional preparatory meetings and three global programs and contribute technical exper-tise in various roundtable discussions. And finally, the Bank will prepare toolkits tohelp guide work at the project implementation level, provide advice on how to promotesustainable development, on payments for environmental services, on strategic envi-ronmental assessment, and on indicators.


The Bank � s Env i ronment PThe Bank � s Env i ronment PThe Bank � s Env i ronment PThe Bank � s Env i ronment PThe Bank � s Env i ronment Porororor t fo l iot fo l iot fo l iot fo l ioor t fo l io

ver the last decade, the World

Bank’s activities in the environ-

mental area have evolved from

primarily stand-alone projects to-

ward a broader portfolio that in-cludes other sector projects with primarilyenvironmental objectives, as well as projects withminor environmental components. This “green-ing” of the Bank’s portfolio has required a changein the methodology for measuring the true ex-tent of environmental lending.

The “core” portfolio.Stand-alone envi-ronment projectsfocus on naturalresource manage-ment (“green pro-jects”), pollution/waste manage-ment (“brown pro-jects”), and institu-

tional development. At the end of the 2001 fiscalyear, this “core” environment portfolio consistedof 95 active projects amounting to $5.1 billion inBank lending.

Almost three quarters of active projects, by lend-ing volume, are in two regions: East Asia and thePacific (EAP) and Latin America and the Carib-bean (LCR). Nearly half (46 percent) are naturalresource management projects. Pollution/wasteprojects comprise 26 percent of the core portfo-lio, while 6 percent of projects address institu-tional development.

The global portfolio. The World Bank is an imple-menting agency for the Global Environment Fa-cility (GEF). GEF projects focus on biodiversityconservation, climate change, international wa-ters, and ozone depletion. As of March 2001, therewere 134 full-size (more than $1 million each)GEF projects, amounting to a total of $7.3 billionin total project costs, of which $1.5 billion is Bank

Core Environment Portfolio:Net Bank commitment, by Region

Natural

resource

management

46%

Environment

adjustment

Pollution/waste

management26%

Environmental

institutional6%

Other

environment14%

6%

Resettlement2%

Core Environment Portfolio:Net Bank commitment, by subsector

$5.1 billion*

Biodiversity

conservation

22%

Climatechange

72%

Internationalwaters

6%

Bank financing in GEF projects

OEurope and

Central Asia

7%

Middle East

& North Africa

3%

South Asia

12%

East Asia

& Pacific

36%

Latin America &

the Caribbean

36%

Sub-Saharan

Africa

6%

* Active projects only.

Understanding environmental lending

Totalevironmentallending

“Broad”portfolio

“Core”portfolio

“Broad”portfolio

Totalevironmentallending

“Core”portfolio

Institutionally definedenvironment projects

Sector projects withenvironmental objectives

Sector projects withenvironmental components

JULY 2001–JUNE 2001 • (FY2001) 57

financing. Nearly three quarters (72 per-cent) of Bank financing in GEF projectsis for climate change issues. In addition,there are 46 medium-sized GEF projects(loans under $1 million), which are con-centrated in Latin America and the Car-ibbean and in Sub-Saharan Africa. Theseprojects amount to nearly $145 million,including $37 million in Bank commit-ments.

The core portfolio, however, capturesonly part of Bank lending for the envi-ronment. The core portfolio of institu-tionally defined “environment” projectsis easily measurable, but capturing othersector projects with environmental ob-jectives or environmental componentsrequires a detailed investigation of theBank’s overall portfolio.

Toward this end, the Environment De-partment recently reviewed the entireportfolios of four key sectors—agricul-ture, electric power and energy, urbandevelopment, and water supply andsanitation (see Box, above right). Thesesectors were chosen based on their rel-evance to environmental issues. The ex-ercise covered almost 800 projects, bothactive and closed, between 1990 and2000. The results show an unequivocaltrend toward increased environmentallending in sector projects.

The cumulative value of both core envi-ronmental operations and environmen-tal investments in other sectors (bothactive and closed projects) since 1990amounts to almost $18 billion (see Chart,at right).

Looking aheadTo date, the review of environmentalcomponents in sectoral projects haslooked at only four key sectors. To bet-ter assess existing environmentalmainstreaming, the review will be ex-

panded to examine projects in other sec-tors such as health, education, and trans-portation. This will also help identifypotential for future incorporation of en-vironmental issues into sectoral projectdesign.

A system for monitoring environmentalmainstreaming in the Bank’s portfolio is

being developed. While there is evi-

dence that projects are increasingly in-corporating environmental objectivesand components, there are currently fewmonitorable indicators to measure thesuccess of this mainstreaming. The de-velopment of monitorable indicators fordifferent sectors would serve as asectoral scorecard for both quantifying—and qualifying—environmental main-streaming in World Bank projects.

Fiscal year

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

Le

nd

ing

(US

$m

illi

on

s)

Core environment portfolio

Environment componentsin other sector projects

Environmentallending* at the

World Bank

1990�2000

*Note: Includes bothactive and closed projects.

Environmental components (major and minor) in sectoral projects were identified basedon criteria established with the assistance of experts in each sector. The value of eachenvironmental component was then estimated based on the breakdown of project costs.

Agriculture. Environmental components were estimated based on the funds allocatedto environmentally sustainable activities in forestry, watersheds, and biodiversity; agri-culture and livestock; irrigation and drainage; fisheries, coastal zones, and aquaculture;and environmental policies and institutional capacity.

Electric Power and Energy. Environmental components promote clean transport fu-els; fuel switching; technology transfer; strengthening environmental management ca-pacity in the energy sector; removing market barriers to renewable and energy efficiencyinvestments; reducing gas flaring and other GHG-intensive activities; facilitating carbontrading and joint investments to reduce emissions; and facilitating environmentally sus-tainable extraction, production, processing, transport, and distribution of oil, gas, andcoal.

Urban Development. Environmental activities in urban projects include the provision ofbasic environmental services, including access to water supply and sanitation, drain-age, solid waste collection, health education, and reduced indoor air pollution.

Water Supply and Sanitation. Environmental activities in this sector include water qualityimprovement and monitoring; water pollution abatement; wastewater and sewage man-agement; standards setting, regulation, and enforcement; environmental policy interven-tions; and institutional strengthening and public awareness.

GREENING SECTORAL PROJECTS


Sub-Saharan Africa (AFR). In this re-gion, more than half (55 percent) ofthe projects are “green”—focused onnatural resource or rural environ-mental management. Ethiopia’s Con-servation of Medicinal Plants project,for example, seeks to initiate supportfor conservation, management, andsustainable utilization of medicinalplants for human and livestockhealthcare. A quarter of the region’sprojects are “brown,” addressing pol-lution/waste management issues.Africa also has a number of globalprojects. Recent examples of GEFprojects include Benin’s NationalParks Conservation and Managementand Malawi’s Mulanje Mountainprojects—both of which deal withbiodiversity conservation.

Brown

25%

Global

11%Green

55%

Institutional

9%


Brown

59%

Global

9%

Green

28%

Institutional

4%

Europe andCentral Asia

Region$2.57 billion*


Brown

57%

Global

10%

Green

31%

Institutional

2%

East Asiaand Pacific



Europe and Central Asia (ECA). LikeEast Asia, projects in this region alsofocus primarily on pollution andwaste management (59 percent). Re-cent “brown” projects include theLiepaja Solid Waste Managementproject in Poland, and municipalwastewater projects in the RussianFederation and Hungary. Recent“green” projects include Kazakh-stan’s Syr Darya Control and North-ern Aral Sea project, which seeks tosustain and increase agriculture andfish production in the Syr Darya ba-sin and improve ecological and en-vironmental conditions in the deltaarea.

East Asia and Pacific (EAP). Pollution/waste management-related projectsconstitute 57 percent of the region’senvironmental portfolio. “Green”projects account for almost anotherthird of the portfolio. In fiscal 2001,four “brown” projects were ap-proved. Two projects in China—LiaoRiver Basin and Huai River PollutionControl—are designed to enhancewater quality management in riverbasins. Vietnam’s Ho Chi Minh CityEnvironmental Sanitation project willlead to sustainable improvements inpublic health through improvementsin drainage and wastewater services.Indonesia’s Western Java Environ-ment Management project deals withformulating provincial environmen-tal strategies and improvements insolid waste management.

Sub-SaharanAfricaRegion

$0.97 billion*

Regionalenvironment portfoliosThe region’s active environmental portfolios consist of core environment projects as well as other sector projects with primarilyenvironmental objectives. GEF and Montreal Protocol projects are also included.

JULY 2001–JUNE 2001 • (FY2001) 59

T h e B a n kT h e B a n kT h e B a n kT h e B a n kT h e B a n k � s E n v i r o n m e n t P� s E n v i r o n m e n t P� s E n v i r o n m e n t P� s E n v i r o n m e n t P o r t f o l i oo r t f o l i oo r t f o l i oo r t f o l i o� s E n v i r o n m e n t P o r t f o l i o

Brown

32%

Global

10%

Green

41%

Institutional

17%

SouthAsia



Brown

65%Global

3%

Green

13%

Institutional

19%

Middle Eastand North Africa



Brown

36%

Global

8%

Green

48%

Institutional

8%

Latin Americaand Caribbean



South Asia (SAR). “Green” projectsaccount for 41 percent of the SouthAsia Region’s environmental portfo-lio. For example, the Karnataka Wa-tershed Development project aims atimproving the productive potentialof selected watersheds. On the“brown” side, which comprises about32 percent of the portfolio, the AirQuality Management project inBangladesh is intended to reduce ve-hicular emissions in metropolitan ar-eas. The project will support settingstandards, enforcing pilot programsthat demonstrate cleaner technolo-gies, and implementing air qualitymonitoring. In the global area, Paki-stan’s Protected Area Managementproject is seeking to conserve glo-bally important habitats and speciesin three protected areas.

Middle East and North Africa (MNA).Solid waste, sewerage, and watersupply and sanitation projects pre-dominate in this region, accountingfor about two thirds of the active en-vironmental portfolio. In fiscal 2001,the Yemen Rural Water Supply andSanitation project aims to expand sus-tainable rural water supply and sani-tation service coverage to mostlypoor rural dwellers in 10 governor-ates. The Solid Waste and Environ-ment Management project in the WestBank and Gaza will implement soundsolid waste management systems.

Latin America and Caribbean (LCR). Al-most half of all environment projectsin this region are focused on naturalresource and rural environmentalmanagement. Recent examples in-clude the Panama Land Administra-tion project, which aims to enhancenatural resources conservationthrough the consolidation of the na-tional system of protected areas andindigenous people’s territories. TheEcuador Rural Water Supply andSanitation project is focused on help-ing the poorest populations in ruralcommunities through investments insustainable water and sanitation ser-vices. On the global front, twoprojects in Mexico—the Mesoameri-can Biological Corridor project andthe Indigenous and Community Con-servation of Biodiversity project(COINBIO)—both aim to conserveareas of high biodiversity.

This article was prepared by Anjali Acharyaand Alethea Mariel T. Abuyuan of theEnvironment Department, (202) 458-5298,fax (202) 477-0565.


SAlbania 3.4 930 -8.3 10.3 0.5 .. 345 0.8 3.1 12,621 .. ..

Algeria 30.0 1,540 6.0 5.4 3.4 .. 159 -1.3 2.5 477 94 73

Angola 12.4 220 .. 3.8 0.5 .. 268 0.2 6.6 14,890 38 44

Argentina 36.6 7,550 8.2 7.3 3.9 1.9 15 0.8 1.8 9,841 79 85

Armenia 3.8 490 -15.9 4.3 0.8 .. 234 -1.3 7.6 2,783 .. ..

Australia 19.0 20,940 11.4 4.1 17.2 80.0 5 0.0 7.1 18,559 100 100

Austria 8.1 25,420 16.1 6.7 7.8 9.1 205 -0.2 29.6 10,381 100 100

Azerbaijan 8.0 560 -24.4 1.5 4.1 .. 205 -1.3 5.5 3,796 .. ..

Bangladesh 127.7 370 9.6 8.9 0.2 .. 1,204 -1.3 0.8 9,482 97 53

Belarus 10.0 2,550 15.5 2.5 6.1 .. 49 -3.2 6.3 5,781 100 ..

Belgium 10.2 24,650 18.1 4.3 10.5 20.6 35 0.2 - .. .. ..

Benin 6.1 380 3.2 2.4 0.2 .. 207 2.3 7.0 4,220 63 23

Bolivia 8.1 990 3.4 4.0 1.4 .. 156 0.3 14.4 38,830 79 66

Bosnia and Herzegovina 3.9 1,210 .. .. 1.2 33.7 436 0.0 0.5 9,662 .. ..

Botswana 1.6 3,040 6.2 .. 2.2 .. 231 0.9 18.5 9,256 .. ..

Brazil 168.0 3,880 12.2 6.5 1.9 2.2 62 0.4 4.4 32,256 87 77

Bulgaria 8.2 1,390 2.0 2.0 6.1 44.8 60 -0.6 4.5 2,193 100 100

Burkina Faso 11.0 240 0.3 .. 0.1 .. 260 0.2 10.4 1,592 .. 29

Burundi 6.7 120 -7.2 .. 0.0 .. 779 9.0 5.7 539 .. ..

Cambodia 11.8 260 .. .. 0.0 .. 263 0.6 16.2 40,505 30 18

Cameroon 14.7 600 8.0 3.5 0.2 .. 127 0.9 4.5 18,243 62 92

Canada 30.5 20,140 14.0 3.2 16.6 19.1 15 0.0 9.8 91,567 100 100

Central African Republic 3.5 290 1.8 .. 0.1 .. 108 0.1 8.2 39,833 60 31

Chad 7.5 210 -7.4 .. 0.0 .. 159 0.6 9.1 5,744 27 29

Chile 15.0 4,600 11.3 5.4 4.1 32.9 111 0.1 18.9 61,793 94 97

China 1,253.6 780 29.4 4.0 2.9 75.9 689 -1.2 6.4 2,257 75 38

Hong Kong, China 6.7 24,710 21.0 8.5 3.7 65.1 .. .. .. .. .. ..

Colombia 41.5 2,170 -0.9 7.9 1.8 8.8 529 0.4 9.0 51,349 91 85

Congo, Dem. Rep. 49.8 .. .. 2.8 0.1 .. 506 0.4 4.5 20,472 45 20

Congo, Rep. 2.9 520 0.7 1.8 0.1 .. 630 0.1 4.5 291,000 51 ..

Costa Rica 3.6 3,700 17.0 9.5 1.6 .. 824 0.8 14.2 31,318 98 96

Cote d'Ivoire 15.5 670 18.5 .. 0.9 .. 281 3.1 6.2 4,998 77 ..

Croatia 4.5 4,510 .. 3.9 4.4 4.9 133 -0.1 7.5 15,995 95 100

Cuba 11.2 .. .. .. 2.3 .. 77 -1.3 17.4 3,400 95 95

Czech Republic 10.3 5,000 19.5 3.2 12.2 71.6 84 0.0 16.1 1,557 .. ..

Denmark 5.3 32,050 17.4 6.4 10.9 57.6 33 -0.2 32.5 1,127 100 ..

Dominican Republic 8.4 1,920 11.8 7.5 1.7 4.5 280 0.0 31.5 2,499 79 71

Ecuador 12.4 1,380 7.2 4.3 1.8 .. 284 1.2 43.6 35,611 71 59

Egypt, Arab Rep. 62.7 1,380 7.0 4.7 2.0 .. 1,197 -3.4 0.8 930 95 94

El Salvador 6.2 1,910 -4.7 6.5 1.0 .. 582 4.6 0.3 2,876 74 83

Eritrea 4.0 200 -25.8 .. .. .. 638 0.3 5.0 2,205 46 13

Estonia 1.4 3,350 12.9 2.5 13.1 93.5 40 -0.6 11.8 8,874 .. ..

Ethiopia 62.8 100 -11.4 2.1 0.1 .. 513 0.8 5.5 1,752 24 15

Finland 5.2 24,710 18.9 3.4 11.0 19.3 81 0.0 6.1 21,293 100 100

France 58.6 24,170 14.6 5.0 6.0 7.4 79 -0.4 13.5 3,258 .. ..

Gabon 1.2 3,280 11.1 4.5 3.0 .. 76 0.0 2.8 135,716 70 21

Gambia, The 1.3 330 -4.8 .. 0.2 .. 430 -1.0 2.3 6,395 62 37

Georgia 5.5 620 .. 4.7 0.8 .. 279 0.0 2.8 11,610 76 99

Germany 82.1 25,630 14.9 5.5 10.4 54.2 89 0.0 - 2,168 .. ..

ince 1998, the World Bankhas been publishing acomprehensive set of en-vironmental indicators inits annual publication

World Development Indicators. Environ-mental indicators are also published inthe Little Green Data Book.

The diversity of conditions across coun-tries and limitations in data availability

make it impossible to capture environ-mental trends worldwide with a smallnumber of indicators. The indicatorsshown here illustrate some of the main

environmental themes.

E n v i r o n m e n t bE n v i r o n m e n t bE n v i r o n m e n t bE n v i r o n m e n t bE n v i r o n m e n t b y t h e N u m b e r sy t h e N u m b e r sy t h e N u m b e r sy t h e N u m b e r sE n v i r o n m e n t bE n v i r o n m e n t bE n v i r o n m e n t bE n v i r o n m e n t b y t h e N u m b e r sy t h e N u m b e r sy t h e N u m b e r sy t h e N u m b e r sy t h e N u m b e r sE n v i r o n m e n t b y t h e N u m b e r s

Country name

Population GNI percapita

Genuinesavings

GDP per unitof energy use

Populationdensity, rural

Annualdeforest-

ation

Nationallyprotected

areasFreshwaterresource per

capita

Access toimproved

water sourceAccess tosanitation

CO2emissions per

capita

Share ofelectricity

generated bycoalmillions

(1999) $, (1999)% GDP(1999)

PPP$/Kg oilequiv (1998) mt (1997) %

people/sq kmarable land

% change,1990-2000

% of landarea m

%total pop

% totalpop3

JULY 2001–JUNE 2001 • (FY2001) 61

Country name


Genuinesavings



Annualdeforest-

ation

Nationallyprotected


capita

Access toimproved


CO2emissions per

capita

Share ofelectricity


(1999) $, (1999)% GDP(1999)



% change,1990-2000

% of landarea m

%total pop

% totalpop3y

Ghana 18.8 400 -1.2 4.6 0.3 .. 319 1.7 4.9 2,832 64 63

Greece 10.5 12,110 11.2 5.7 8.3 70.3 149 -0.9 3.6 6,548 .. ..

Guatemala 11.1 1,680 -1.0 6.1 0.8 .. 482 1.7 16.8 12,121 92 85

Guinea 7.3 490 3.6 .. 0.2 .. 550 0.5 0.7 31,170 48 58

Guinea-Bissau 1.2 170 -6.4 .. 0.2 .. 298 0.9 - 22,791 49 47

Haiti 7.8 460 -9.3 5.3 0.2 .. 895 5.7 0.4 1,551 46 28

Honduras

Hungary

India

Indonesia

Iran, Islamic Rep.

Iraq

Ireland

Israel

Italy

Jamaica

Japan

Jordan

Kazakhstan

Kenya

Korea, Dem. Rep.

Korea, Rep.

Kuwait

Kyrgyz Republic

Lao PDR

Latvia

Lebanon

Lesotho

Libya

Lithuania

Macedonia, FYR

Madagascar

Malawi

Malaysia

Mali

Mauritania

Mauritius

Mexico

Moldova

Mongolia

Morocco

Mozambique

Myanmar

Namibia

Nepal

Netherlands

New Zealand

Nicaragua

Niger

Nigeria

Norway

Oman

Pakistan

Panama

Papua New Guinea

Paraguay

Peru

Philippines

Poland

Portugal

6.3 770 16.5 4.5 0.8 .. 179 1.0 6.0 15,211

10.1 4,640 19.4 4.3 5.9 26.0 76 -0.4 7.0 11,919

997.5 440 9.0 4.3 1.1 75.4 438 -0.1 4.8 1,913

207.0 580 15.8 4.6 1.3 28.8 695 1.2 10.6 13,709

63.0 1,600 -5.5 3.3 4.9 .. 145 0.0 5.1 2,040

22.8 .. .. .. 4.2 .. 104 0.0 0.0 1,544

3.8 21,450 32.2 6.4 10.2 40.4 114 -3.0 0.9 13,859

6.1 16,310 3.2 5.7 10.4 69.8 153 -4.9 15.8 180

57.6 20,170 14.5 7.4 7.4 11.0 231 -0.3 7.5 2,906

2.6 2,400 10.9 2.2 4.3 .. 664 1.5 0.1 3,618

126.6 32,030 16.3 6.0 9.6 19.1 599 0.0 6.8 3,397

4.7 1,630 -3.0 3.6 3.5 .. 485 0.0 3.4 148

14.9 1,290 -8.2 1.8 8.0 72.0 22 -2.2 2.7 7,342

29.4 360 0.6 2.0 0.3 .. 494 0.5 6.2 1,027

23.4 .. .. .. 11.4 .. 548 0.0 2.6 3,293

46.9 8,480 .. 4.0 9.9 42.8 532 0.1 6.9 1,490

1.9 .. .. .. 28.2 .. 821 -5.2 1.5 ..

4.9 300 -1.5 4.0 1.4 .. 235 -2.6 3.6 9,559

5.1 290 .. .. 0.1 .. 483 0.4 - 55,251

2.4 2,500 11.2 3.4 3.3 1.7 41 -0.4 13.0 14,561

4.3 3,730 .. 3.7 4.3 .. 262 0.3 0.5 1,124

2.1 570 .. .. .. .. 466 0.0 0.2 2,470

5.4 .. .. .. 8.4 .. 39 -1.4 0.1 148

3.7 2,640 7.2 2.7 4.1 .. 40 -0.2 10.0 6,732

2.0 1,660 .. .. 5.5 .. 133 0.0 7.1 3,464

15.1 250 0.0 .. 0.1 .. 408 0.9 1.9 22,391

10.8 200 -9.0 .. 0.1 .. 437 2.4 11.3 1,724

22.7 3,370 34.2 3.9 6.3 3.2 537 1.2 4.6 25,539

10.6 240 5.6 .. 0.0 .. 160 0.7 3.7 9,449

2.6 390 -16.3 .. 1.2 .. 233 2.7 1.7 4,387

1.2 3,540 15.6 .. 1.5 .. 684 0.6 7.7 1,873

96.6 4,440 11.3 5.2 4.0 9.8 98 1.1 3.5 4,742

4.3 410 4.6 2.2 2.4 10.9 129 -0.2 1.4 2,733

2.4 390 .. .. 3.3 .. 67 0.5 11.5 14,632

28.2 1,190 14.8 10.2 1.3 55.3 140 0.0 0.7 1,062

17.3 220 1.3 2.0 0.1 .. 339 0.2 6.1 12,486

45.0 .. .. .. 0.2 .. 340 1.4 0.3 22,404

1.7 2,100 3.3 .. .. .. 143 0.9 12.9 26,744

23.4 220 0.8 3.5 0.1 .. 700 1.8 7.8 8,989

15.8 25,140 19.2 4.9 10.5 29.9 186 -0.3 6.8 5,758

3.8 14,000 .. 4.0 8.4 3.9 35 -0.5 23.6 85,811

4.9 400 -18.3 4.0 0.7 .. 87 3.0 7.5 38,668

10.5 190 -4.1 .. 0.1 .. 163 3.7 7.7 3,097

123.9 250 -18.3 1.2 0.7 .. 248 2.6 3.3 2,260

4.5 33,470 19.2 4.8 15.6 0.2 123 -0.4 6.8 88,117

2.3 .. .. .. 8.2 .. 2,785 0.0 16.1 426

134.8 460 0.6 4.0 0.8 0.7 394 1.1 4.8 1,892

2.8 3,060 21.2 6.5 2.9 .. 244 1.6 19.1 52,437

4.7 810 .. .. 0.5 .. 6,379 0.4 0.0 170,258

5.4 1,570 3.7 5.4 0.8 .. 108 0.5 3.5 17,541

25.2 2,130 11.3 7.8 1.2 .. 189 0.4 2.7 69,203

74.3 1,060 12.3 7.0 1.1 22.9 573 1.4 4.9 6,450

38.7 4,060 12.9 3.2 9.2 96.3 97 -0.1 9.6 1,630

10.0 11,010 .. 7.0 5.4 31.0 206 -1.7 6.6 7,208

90 77

99 99

88 31

76 66

95 81

85 79

.. ..

.. ..

.. ..

71 84

.. ..

96 99

91 99

49 86

.. ..

92 63

.. ..

77 100

90 46

.. ..

100 99

91 92

72 97

.. ..

99 99

47 42

57 77

.. ..

65 69

37 33

100 99

86 73

100 ..

60 30

82 75

60 43

68 46

77 41

81 27

100 100

.. ..

79 84

59 20

57 63

100 ..

39 92

88 61

87 94

42 82

79 95

77 76

87 83

.. ..

.. ..


Puerto Rico

Romania

Russian Federation

Rwanda

Saudi Arabia

Senegal

Sierra Leone

Singapore

Slovak Republic

Slovenia

3.9 .. .. .. 4.5 .. 2,990 0.2 2.1 ..

22.5 1,510 6.1 3.5 4.9 28.0 107 -0.2 4.7 1,648

146.2 1,750 12.2 1.7 9.8 19.4 27 0.0 3.1 30,767

8.3 240 -7.7 .. 0.1 .. 929 3.9 14.7 758

20.2 6,900 -13.3 2.1 14.3 .. 82 0.0 2.3 119

9.3 500 7.6 4.4 0.4 .. 219 0.7 11.3 4,243

4.9 130 -14.6 .. 0.1 .. 649 2.9 1.1 32,328

4.0 24,190 41.2 3.2 21.6 .. 5,700 0.0 4.8 ..

5.4 3,770 19.6 3.2 7.1 23.5 157 -0.3 22.6 15,382

2.0 9,980 11.1 4.4 7.8 35.5 427 -0.2 6.0 9,318

.. ..

58 53

99 ..

41 8

95 100

78 70

28 28

100 100

100 100

100 ..

South Africa

Spain

Sri Lanka

Sudan

Sweden

Switzerland

Syrian Arab Republic

Tajikistan

Tanzania

Thailand

Togo

Trinidad and Tobago

Tunisia

Turkey

Turkmenistan

Uganda

Ukraine

United Arab Emirates

United Kingdom

United States

Uruguay

Uzbekistan

Venezuela

Vietnam

West Bank and Gaza

Yemen, Rep.

Yugoslavia, FR (Serbia/Montenegro)

Zambia

Zimbabwe

World

Low Income

Middle Income

Lower Middle Income

Upper Middle Income

Low and Middle Income

East Asia & Pacific

Europe & Central Asia

Latin America & Carib.

Middle East & N. Africa

South Asia

Sub-Saharan Africa

High Income

Europe EMU

42.1 3,160 10.5 3.3 7.9 92.6 140 0.1 5.4 1,187 86 86

39.4 14,800 15.9 5.9 6.6 32.6 63 -0.6 8.5 2,844 .. ..

19.0 830 15.5 8.0 0.4 .. 1,664 1.6 13.5 2,626 83 83

29.0 310 .. .. 0.1 .. 112 1.4 3.6 5,312 75 62

8.9 26,750 17.1 3.6 5.5 2.0 53 0.0 8.9 20,096 100 100

7.1 38,230 18.9 7.0 6.0 .. 553 -0.4 26.9 7,427 100 100

15.7 1,020 -3.9 3.3 3.3 .. 151 0.0 - 2,845 80 90

6.2 170 8.1 .. 0.9 .. 583 -0.5 4.2 12,763 .. ..

32.9 260 -1.5 1.1 0.1 .. 595 0.2 15.6 2,703 54 90

60.2 2,000 25.8 5.1 3.8 18.3 281 0.7 13.9 6,804 80 96

4.6 310 -0.7 .. 0.2 .. 137 3.4 7.9 2,628 54 34

1.3 4,750 4.8 1.1 17.4 .. 460 0.8 6.0 .. 86 88

9.5 2,090 18.1 6.9 2.0 .. 116 -0.2 0.3 434 .. ..

64.4 2,880 15.4 5.8 3.5 32.1 70 -0.2 1.3 3,162 83 91

4.8 690 .. 1.2 6.7 .. 160 0.0 4.2 9,520 58 100

21.5 320 -2.0 .. 0.1 .. 357 2.0 9.6 3,073 50 75

50.0 770 7.5 1.2 7.3 26.5 49 -0.3 1.6 2,795 .. ..

2.8 .. .. 1.8 32.0 .. 1,017 -2.8 - 71 .. ..

59.5 23,590 7.7 5.4 8.9 34.5 100 -0.8 20.7 2,471 100 100

278.2 31,920 8.3 3.8 20.1 52.7 36 -0.2 13.4 8,906 100 100

3.3 6,240 5.1 9.9 1.8 .. 24 -5.0 0.3 17,809 98 95

24.4 640 -4.6 1.1 4.4 4.1 336 -0.2 2.0 668 85 100

23.7 3,730 1.7 2.4 8.4 .. 120 0.4 36.6 35,686 84 74

77.5 370 11.4 4.0 0.6 16.1 1,080 -0.5 3.1 11,497 56 73

2.8 1,800 .. .. .. .. .. .. .. .. .. ..

17.0 360 -19.4 3.7 1.0 .. 838 1.8 - 241 69 45

10.6 .. .. .. 4.7 .. .. 0.0 3.3 17,709 .. ..

9.9 320 -8.7 1.2 0.3 0.5 111 2.4 8.6 11,739 64 78

11.9 530 5.1 3.3 1.6 71.5 240 1.5 7.9 1,680 85 68

5,978.1 4,990 17.4 4.2 4.1 .. 520 0.2 6.5 8,240 81 56

2,412.3 410 15.7 3.4 1.1 .. 508 0.8 5.7 6,196 76 45

2,668.7 1,910 22.7 3.9 3.8 .. 583 0.1 5.2 9,540 81 59

2,029.9 1,090 26.6 3.6 3.4 .. 637 -0.1 4.9 7,688 80 52

638.8 4,530 19.7 4.3 5.2 .. 187 0.5 5.8 15,462 87 81

5,081.0 1,200 21.6 3.7 2.5 .. 542 0.3 5.4 7,949 79 52

1,836.6 1,010 28.0 4.2 2.8 .. 691 0.2 7.0 .. 75 47

474.4 1,990 23.9 2.3 6.9 32.5 125 -0.1 3.3 12,797 90 ..

508.0 3,640 15.1 5.7 2.8 .. 251 0.5 7.4 27,934 85 78

290.0 2,000 38.1 3.5 4.0 .. 534 -0.1 2.2 1,147 89 83

1,329.3 440 10.5 4.5 0.9 .. 537 0.1 4.5 2,854 87 36

642.8 490 12.3 2.4 0.8 .. 369 0.8 6.2 8,248 55 55

897.1 26,430 .. 4.6 12.8 .. 178 -0.1 10.2 .. .. ..

292.8 22,250 15.7 5.6 8.2 27.4 141 -0.3 8.1 3,769 .. ..

Country name


Genuinesavings



Annualdeforest-

ation

Nationallyprotected


capita

Access toimproved


CO2emissions per

capita

Share ofelectricity


(1999) $, (1999)% GDP(1999)



% change,1990-2000

% of landarea m

%total pop

% totalpop3

JULY 2001–JUNE 2001 • (FY2001) 63

About the dataGenuine savings is an indicator of eco-nomic and environmental sustainabilityderived from the national accounts. It mea-sures the change in value of the totalwealth—produced, natural, and humancapital—upon which development de-pends. The link to sustainable developmentis direct, in that a decline in total wealthimplies a decline in future welfare—this isthe standard economic definition ofunsustainability.

GDP per unit of energy use provides ameasure of energy efficiency. Differences inthis ratio over time and across countriesreflect in part structural changes in theeconomy, changes in energy efficiency ofparticular sectors, and differences in fuelmixes.

Carbon dioxide emissions account for thelargest share of greenhouse gases, whichare associated with global warming. An-thropogenic CO2 emissions result primarilyfrom fossil fuel combustion and cementmanufacturing. In combustion, differentfossil fuels release different amounts of CO2

for the same level of energy use. Burningoil releases about 50 percent more CO2 thanburning natural gas, and burning coal re-leases about twice as much. Cement manu-facturing releases about half a metric tonof CO2 for each ton of cement produced.

Use of energy in general, and access to elec-tricity in particular, are important in im-proving people’s standard of living. Butelectricity generation can also damage theenvironment. Whether such damage oc-curs largely depends on how electricity isgenerated. For example, burning coal re-leases twice as much carbon dioxide—amajor contributor to both global warmingand local air pollution—as does burning anequivalent amount of natural gas.

Rural population density provides an in-dicator of pressure on natural ecosystemsand resources such as soil and forests.

Deforestation is a major cause ofbiodiversity loss, and habitat conservationis vital for stemming this loss. According tothe latest FAO assessment, the global rateof net deforestation has slowed to 9 millionhectares a year, a rate 20 percent lower than

that previously reported. Due to space limi-tations, the subtotals for natural and plan-tation forest do not appear here; theaggregate numbers may underestimate therate at which natural forest is disappear-ing in some countries.

Conservation efforts have traditionally fo-cused on protected areas, which havegrown substantially in recent decades. Des-ignating land as a protected area does notnecessarily mean that protection is in force,however. Many protected areas are only“paper parks.” The data reported here arefor protected areas of at least 1,000 hect-ares. For small countries that may only haveprotected areas less than 1,000 hectares,this definition will result in an underesti-mate of the extent and number of protectedareas.

Almost one third of the world’s populationfaces water scarcity or water stress, espe-cially in Africa, the Middle East, LatinAmerica and the Caribbean, and largeparts of South Asia. The data on freshwa-ter resources are based on run-off into riv-ers and recharge of groundwater. Theseestimates are based on different sources andrefer to different years, so cross-countrycomparisons should be made with caution.Because data are collected intermittently,they may hide significant variations in to-tal renewable water resources from one yearto the next. The data also fail to distinguishbetween seasonal and geographic varia-tions in water availability within countries.

Access to safe water sources and to sani-tation are important indicators of progressin implementing national health strategies.Diseases transmitted by feces are commonin developing countries, largely because ofthe lack of clean water and basic sanita-tion. Drinking water contaminated by fe-ces deposited near homes and aninadequate water supply cause diseasesaccounting for 10 percent of the diseaseburden in developing countries. Access todrinking water from an improved sourcedoes not ensure that it is adequate or safe.Information on access to an improved wa-ter source is extremely subjective, and termssuch as safe, improved, and adequate mayhave very different meanings in differentcountries, despite WHO definitions. Evenin high-income countries, treated water

may not be safe to drink.

Definitions and data sourcesPopulation includes all residents who are present regardlessof legal status or citizenship�except for refugees not perma-nently settled in the country of asylum, who are generallyconsidered part of the population of their country of origin.The values shown are midyear estimates. (The World Bank,United Nations; the data are for 1999).

GNI per capita is gross national income (formerly called grossnational product or GNP) divided by midyear population. GNIis the sum of gross value added by all resident producers plusany taxes (less subsidies) that are not included in the valuationof output plus net receipts of primary income (employee com-pensation and property income) from nonresident sources.GNI per capita is in current US dollars, converted using theWorld Bank Atlas Method; see the statistical methods in WorldDevelopment Indicators 2001. (The World Bank, OECD, UnitedNations; the data are for 1999.)

Genuine domestic savings are equal to net domestic sav-ings, plus education expenditures and minus energy depletion,mineral depletion, net forest depletion, and carbon dioxidedamage. (The World Bank; the data are for 1999.)

GDP per unit of energy use is the purchasing power parity(PPP) GDP per kilogram of oil equivalent of commercial energyuse. PPP GDP is gross domestic product converted to interna-tional dollars using purchasing power parity rates. An interna-tional dollar has the same purchasing power over GDP as a U.S.dollar in the United States. (The International Energy Agency,the World Bank; the data are for 1998)

Carbon dioxide emissions per capita include emissions fromthe burning of fossil fuels and the manufacture of cement.They include carbon dioxide produced during consumption ofsolid, liquid, and gas fuels and gas flaring. (Carbon DioxideInformation Analysis Center; the data are for 1997).

Share of electricity generated by coal refers to the contri-bution of coal, as an input, in the generation of electricity. (TheInternational Energy Agency; the data are for 1998)

Rural population density is the rural population divided bythe arable land area. Rural population is estimated as the differ-ence between the total population and urban population(World Bank estimates; the data are for 1998).

Annual deforestation refers to the permanent conversion ofnatural forest area to other uses, including shifting cultivation,permanent agriculture, ranching, settlements, and infrastruc-ture development. Deforested areas do not include areas loggedbut intended for regeneration, or areas degraded by fuelwoodgathering, acid precipitation, or forest fires. Negative numbersindicate an increase in forest areas. (Food and Agriculture Or-ganization; the data are for the period 1990-2000)

Nationally protected areas are totally or partially protectedareas of at least 1,000 hectares that are designated as nationalparks, natural monuments, nature reserves or wildlife sanctu-aries, protected landscapes and seascapes, or scientific reserves.(The World Conservation Monitoring Center; the data are for1999)

Freshwater resources refer to total renewable resources,which include flows of rivers and groundwater from rainfall inthe country, and river flows from other countries. Freshwaterresources per capita are calculated using the World Bank�spopulation estimates. (The World Resources Institute; the es-timates are for 1999)

Access to an improved water source refers to the per-centage of the population with reasonable access to an ad-equate amount of water from an improved source, such as ahousehold connection, public standpipe, borehole, protectedwell or spring, or rainwater collection. Unimproved sourcesinclude vendors, tanker trucks, and unprotected wells andsprings. Reasonable access to an adequate amount is definedas the availability of at least 20 liters a person a day from asource within one kilometer of the dwelling. (World HealthOrganization; the data are for 2000)

Access to sanitation is the share of the population withaccess to at least adequate excreta disposal facilities (private orshared, but not public) that can effectively prevent human,animal, and insect contact with excreta. Improved facilitiesrange from simple but protected pit latrines to flush toiletswith a sewerage connection. To be effective, facilities must becorrectly constructed and properly maintained. (World HealthOrganization; the data are for 2000)

This article was prepared by Stefano Pagiola,(202) 458-2997, fax (202) 522-1735, and KirkHamilton, (202) 473-2053, fax (202) 522-1735,of the Environment Department.

E n v i r o n m e n t b y t h e N u m b e r sE n v i r o n m e n t b y t h e N u m b e r sE n v i r o n m e n t b y t h e N u m b e r sE n v i r o n m e n t b y t h e N u m b e r sE n v i r o n m e n t b y t h e N u m b e r s


P u b l i c a t iP u b l i c a t iP u b l i c a t iP u b l i c a t iP u b l i c a t i ooooon sn sn sn sn s

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Making Sustainable Commitments � An Environment Strategyfor the World BankWorld BankSeptember 2001 (ISBN 0-8213-4935-X)

China � Air, Land, and Water: Environmental Priorities for aNew MillenniumWorld BankAugust 2001 (ISBN 0-8213-4937-6)

World Bank WWF Alliance � For Forest Conservation &Sustainable Use: Annual Report 2000World Bank/WWF 2001

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Hunting of Wildlife in Tropical Forests � Implications forBiodiversity and Forest PeoplesElizabeth L. Bennett and John G. RobinsonMarch 2001

Biodiversity Conservation in the Context of Tropical ForestManagementFrancis E. Putz, Kent H. Redford, John G. Robinson, RobertFimbel, and Geoffrey M. BlateSeptember 2000

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Climate Information and Forecasting for Development �Lessons from the 1997/98 El NiñoEnvironment Department Paper No. 79Maarten K. van Aalst, Samuel Fankhauser, Sally M. Kane,and Kelly SponbergDecember 2000

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Developing Indicators � Lessons Learned from CentralAmerica

Lisa Segnestam in collaboration with Manuel Winograd andAndrew FarrowNovember 2000

A Decade of Environmental Management in ChileEnvironment Department Paper No. 82Ina-Marlene RuthenbergJuly 2001 (Also available in Spanish)

Country Assistance Strategies and the EnvironmentEnvironment Department Paper No. 81Priya Shyamsundar, Kirk Hamilton, Lisa Segnestam, MariaSarraf, and Samuel FankhauserJuly 2001

Tourism and the Environment in the CaribbeanEnvironment Department Paper No. 80John Dixon, Kirk Hamilton, Stefano Pagiola, and LisaSegnestamMarch 2001

Genuine Saving as a Sustainability IndicatorEnvironment Department Paper No. 77Kirk HamiltonOctober 2000

Pollution ManagementPollut ion ManagementPollut ion ManagementPollut ion ManagementPollut ion Management

Urban Air Quality Management � Coordinating Transport,Environment, and Energy PoliciesWorld Bank Technical Paper No. 508, Pollution ManagementSeries.Masami Kojima and Magda LoveiSeptember 2001 (ISBN 0-8213-4948-1)

Environmental Costs of Fossil Fuels � A Rapid AssessmentMethod with Application to Six CitiesEnvironment Department Paper No. 78Kseniya Lvovsky, Gordon Hughes, David Maddison,Bart Ostro, and David PearceOctober 2000

An Environment Strategy for the WAn Environment Strategy for the WAn Environment Strategy for the WAn Environment Strategy for the WAn Environment Strategy for the World Bankor ld Bankor ld Bankor ld Bankor ld Bank

In many developing countries, the costs of environmental degradation have beenestimated at 4 to 8 percent of GDP annually. Natural resources degradation�depleted soils, insufficient water, rapidly disappearing forests, collapsed fisher-

ies�threaten the quality of life of millions of people. Environment problems alsothreaten the health of millions; an estimated 6 million people die annually, andmany more get sick, in developing countries from water-related diseases, indoor airpollution, urban air pollution, and exposure to toxic chemicals. Environmentaldegradation also increases the vulnerability of people to natural disasters. Theimpact of environmental degradation threatens the basis for growth and livelihoodstoday and in the future. Environmental degradation also reaches across borders,affecting the quality of the regional and global commons. The Environment Strategyis responding to these challenges.

This Environment Strategy outlines how the World Bank will work with clientcountries to address their environmental challenges and ensure that Bank projectsand programs integrate principles of environmental sustainability. The Strategy setsa vision, objectives, and a course of action for the longer term and suggests specificactions, targets, and institutional measures for the next five years, as described inTables 1 and 2 of the Executive Summary. The Strategy is the product of a multi-yeareffort, including an extensive evaluation of the Bank�s past performance, andnumerous workshops and consultations with client governments, civil society,academia, multilateral and bilateral development agencies, and representatives ofthe private sector.

Over the last two decades, the Chinese government has made significantinroads in battling a range of environmental problems�including airpollution, water pollution, and deforestation. Yet environmental challenges

are likely to be far greater and more complex over the next 10 years, which willrequire a significant change in development strategy. This is the main finding of anew World Bank report entitled China: Air, Land, and Water � EnvironmentalPriorities for a New Millennium, which was released in August 2001.

The report was prepared by a World Bank team and assisted by technical specialistsfrom 10 Chinese research institutes, universities, and NGOs. It reviews the state ofChina�s environment, assesses the effectiveness of the government�s environmentalprotection work over the last 10 years, and makes recommendations on how toaddress the new challenges that will face the country over the next decade. Thereport points to three areas of success: broad-based and absolute reduction inindustrial air and water pollutant emissions during the second half of the 1990s; thereversal of deforestation through massive investments in reforestation and afforesta-tion; and the reversal of secondary salinization in irrigation areas through majorprograms of both control and prevention.

Overall, the report urges that China�s environmental strategy needs to become moreproactive. The current approach focuses mainly on remedying the adverse environ-mental effects of previous development decisions. In the future, more emphasisshould be placed on avoiding or minimizing the adverse environmental effects ofdevelopment policy in the first place.

Written for a broad audience, this book will be of interest to all those concernedabout environmental quality in Asia. A CD-ROM, which is included in the book,provides background research and additional technical detail.

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Mail or fax to: Environment Department Publications Fax: (202) 477-0565; phone (202) 473-3641The World Bank1818 H Street, N.W., Room MC-5-126Washington, D.C. 20433 U.S.A.

Improving Urban Air Quality in South Asia by ReducingEmissions from Two-Stroke Engine VehiclesMasami Kojima, Carter Brandon, and Jitendra ShahDecember 2000

Cleaner Transport Fuels for Cleaner Air in Central Asiaand the CaucasusMasami Kojima, Robert W. Bacon, Martin Fodor, andMagda LoveiAugust 2000

Rural DevelopmentRural DevelopmentRural DevelopmentRural DevelopmentRural Development

Agricultural Trade Liberalization in a New Trade Round �Perspectives of Developing Countries and Transition EconomiesWorld Bank Technical Paper No. 418Merlinda Ingco and L. Alan Winters, eds.September 2001. (ISBN 0-8213-4986-4)Available for purchase in the World Bank Bookstore andonline at http://publications.worldbank.org

Rural Non-Farm Activities and Rural Development � FromExperience Towards StrategyRural Strategy Background Paper No. 5Peter Lanjouw and Gershon FederAvailable on the online World Bank Rural publications catalogat http://wbln0018.worldbank.org/essd/essd.nsf/RuralDevelopment/Pubs

What Has Changed Regarding Rural Poverty Since Vision toAction?Rural Strategy Background Paper No. 4Harold AldermanAvailable on the online World Bank Rural publications catalogat http://wbln0018.worldbank.org/essd/essd.nsf/RuralDevelopment/Pubs

Social DevelopmentSocial DevelopmentSocial DevelopmentSocial DevelopmentSocial Development

Social Exclusion and Poverty Reduction in Latin Americaand the CaribbeanEstanislao Gacitúa, Carlos Sojo with Shelton DavisAugust 2001. (Also available in Spanish.)

Interest Groups and Organizations as StakeholdersRobert Bianchi, Sherrie A. Kossoudji, SDV 35, June 2001.

Social Analysis, Selected Tools and TechniquesRichard A. Krueger, Mary Anne Casey, Jonathan Donner,Stuart Kirsch, and Jonathan Maack, SDP36June 2001

Inclusion and Local Elected Governments � The PanchayatRaj System in IndiaRuth J. Aslop, Anirudh Krishna, and Disa Sjoblom, SDP 37May 2001

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Urban Air QualityManagement —

CoordinatingTransport, Environ-

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September 2001.68 pages.

(ISBN 0-8213-4948-1)$10.00

For information on how to obtain these publications, please call the World BankEnvironment Department at (202) 473-3641, or e-mail [email protected].

BiodiversityConservation in theContext of TropicalForest Managementby Francis E. Putz,Kent H. Redford, JohnG. Robinson, RobertFimbel, and GeoffreyM. Blate, September2000. EnvironmentDepartment PaperNo. 75. 88 pages.

DevelopingIndicators —

Lessons Learnedfrom Central America

by Lisa Segnestam incollaboration with

Manuel Winograd andAndrew Farrow,

November 2000.56 pages. (Available

in Spanish.)

Social Exclusion andPoverty Reduction inLatin Americaand the Caribbeanby Estanislao Gacitúa,and Carlos Sojo,with Shelton Davis,August 2001. 304 pages.(Available in Spanish.)

World Bank/WWFAlliance for ForestConservation &Sustainable Use —Annual Report 200040 pages.Visit the Alliance websiteat: http://www-esd.world-bank.org/wwf.

Improving Urban AirQuality in South Asiaby Reducing Emis-sions from Two-Stroke EngineVehiclesby Masami Kojima,Carter Brandon, andJitendra Shah,December 2000.60 pages.

Making SustainableCommitments —An EnvironmentStrategy for the

World BankSeptember 2001.

276 pages.(ISBN 0-8213-4935-X)

$22.00

Agricultural TradeLiberalization in a

New Trade Round —Perspectives of

Developing Countriesand Transition

EconomiesWorld Bank Technical

Paper No. 418 byMerlinda Ingco and L.

Alan Winters, eds.September 2001. 172

pages. (ISBN 0-8213-4986-4). $22.00

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Documents

Making Sustainable Urban Air Quality Commitments ... · Estanislao Gacitœa, Carlos Sojo with Shelton Davis August 2001. (Also available in Spanish.) Interest Groups and Organizations