World Rainforest Movement

World Bank Takes Low Road on Water Policy

In February, the World Bank approved a new Water Resources Sector Strategy (WRSS). The strategy says the Bank needs to shrug off its critics and boost spending on big dams and other water megaprojects.

This strategy is a reactionary, dishonest and cynical document. If put into effect it will provide rich pickings for the big dam lobby and private water companies, but only worsen poverty, water shortages and the dire condition of the world’s rivers.

As the world’s largest development institution, the World Bank helps set the agenda for other donors and governments. The strategy could thus do great harm not only by setting priorities for World Bank lending, but also by influencing other institutions.

Reactionary: Over the past decade water managers have been moving away from megaprojects. They have increasingly realized that focusing on huge water projects for water supply, flood control and electricity is expensive, frequently ineffective and socially and environmentally damaging. The new approach to meeting water needs prioritizes small-scale, affordable technologies such as harvesting rainwater and recharging groundwater, flood management through measures such as better warning systems and wetlands restoration, and reducing demand for water through better management and improved technologies.

The WRSS shows that the World Bank seeks to turn back the clock on water management. It promotes dated megadam-based strategies as the solution to the water problems of the 21st century – problems often caused by dams.

Dishonest: Shortly before the release of the report of the World Bank-sponsored World Commission on Dams, Bank management told the Commissioners that the WRSS would be the main vehicle in which the Bank would address their findings and recommendations.

Yet the strategy ignores the Commission’s findings on the poor economic performance of dams, their negative impacts, and the availability of better alternatives. It states that the Bank concurs with the “core values” and “strategic priorities” of the WCD, but will not adopt the WCD’s detailed guidelines into its policies because they are too strict. The WCD was established largely because the Bank’s policies had failed to prevent its lending for destructive and unnecessary dams. It is of little use for the Bank to say it agrees with the WCD’s general principles without agreeing to adopt the guidelines which explain how to put these principles into practice.

The strategy calls on the Bank to support hydropower, “ensuring, of course, that this is the most appropriate option and that good environmental and social practices are followed.” But the Bank repeatedly supports dams that are not the best options and do not follow good practices. Only if the Bank commits to following WCD recommendations can there be hope for positive change in the Bank’s business-as-usual dam building practices.

Cynical: In the strategy, the Bank feigns concern for the more than one billion people who currently lack access to safe water, and claims that the solution to this humanitarian tragedy lies in promoting subsidies to encourage private investors in water supply.

Yet 80% of the world’s people without decent access to safe drinking water live in rural areas. Water multinationals have little interest in the unprofitable business of supplying water to poor and dispersed rural populations.

Similarly, major water projects are of little relevance to meeting the water supply needs of rural areas – and in fact often result in depriving rural areas of their water resources for the benefit of cities and agribusiness.

The Bank’s water strategy is thus largely irrelevant to meeting the needs of the great majority without access to water.

The World Bank itself shows little interest in rural people in its lending operations – less than 1% of Bank lending from 1993 and 2002 went for rural water supply and sanitation schemes.

There is a huge potential for improving the environment and the lives of the poor by implementing demand-side management and decentralized, community-led solutions for water and sanitation. In particular, rainwater harvesting and low- and no-water sanitation technologies offer real potential for both rural and urban areas. Implementing the model proposed in the WRSS will set back efforts to realize this potential and will further worsen the already serious failings of the water sector.

There is an important role for the Bank in improving the performance and safety, and mitigating the negative impacts, of existing infrastructure. Outside of these activities, it would be better for the World Bank to disengage from the water sector than to implement the measures proposed in the flawed WRSS.

By: Patrick McCully, International Rivers Network, sent by Lori Pottinger, e-mail: ; (article published in the April 2003 issue of IRN’s World Rivers Review).