The World Bank has just recently commissioned a report which could recommend that they consider pulling out of financing all coal and oil projects in developing countries, something which if recommended strongly may cause shareholder unrest.

A draft report has already been circulated to an expert panel advising them to phase out funding all oil projects by 2008, and fund no more coal mining projects. It advises that the bank should add on what they call a "shadow price" of the damage caused by greenhouse gas emissions when assessing the costs and benefits of projects.

It also calls on the bank to step up funding for renewable energy projects, citing damage from climate change.

This would be a philosophy Green Isp support as most companies do not take environmental impact into account when they work out their wealth. Also GDP, if adjustments were made to take in to account environmental impact , would not represent true wealth and standard of living for the benefactors.

Commissioned by the banks president James Wolfensohn and named The Extractive Industries Review, it will reveal its recommendations immanently.

Funding from the World Bank is considered to be a major factor in giving the Thumbs Up to many oil and gas projects, which are often opposed by environmentalist groups.

Peter Woicke, the head of the IFC(sister company of World Bank), said recently that "financial contributions were important in giving the bank leverage over a project".

But if the bank still enjoyed working in this field, it would be better placed to give constructive advice rather than funding.


 
 

Two of the bank's more controversial projects of recent years, the Chad/Cameroon oil pipeline and the Caspian oil project, have been shoved through by management at the bank and its shareholder countries, in particular the US, against environmentalist campaigners outspoken and serious opposition.

NGOs such as Friends of the Earth accused the World Bank of trying to exert undue influence over the whole process, and of giving too large a voice to business representatives.

The Extractive Industries Review, which was launched in 2001, has held consultative meetings with NGOs and business representatives. And was intended to give advice to the World Bank on its involvement in oil, gas and mining projects throughout the world.

Bernard Salomé, who represented the bank and was was appointed as secretary to the review, recently left after complaints that the process was being hijacked by the bank.

The review was designed to learn from the World Commission on Dams farce, which reported in 2000.

This commission, following a similar process to this World Bank on coal and oil projects, outlined an agreement on guidelines for building dams in the developing world. But many of its recommendations were not adopted by the Bank or developing country governments.

november 2003