Policy Coherence for Sustainable Infrastructure in Developing Countries: The Case of OECD-Country Public Financing for Large Dams

By Caspary, Georg | Global Governance, October-December 2009 | Go to article overview

Policy Coherence for Sustainable Infrastructure in Developing Countries: The Case of OECD-Country Public Financing for Large Dams


Caspary, Georg, Global Governance


Public financial institutions (PFIs) provide vital investment for poor countries, and act as catalysts for additional private capital. However, the projects thus financed often have social and environmental side effects. Safeguards systems control such side effects. This article compares the strength of PFIs' safeguards systems. Although the study uses financing for dams as an example, the issue has much larger applicability. In fact, all development project or policy interventions have social or environmental side effects and therefore necessitate safeguards. This article notably finds substantive evidence that safeguards performance substantially differs between different PFIs. It argues that the most important explanations for this finding are differences in coordination mechanisms among different PFIs, and diverging interest group pressure on different PFIs. Finally, the article explores several avenues for future work following from these findings, notably exploring steps to harmonize PFIs' safeguards performance. Keywords: infrastructure finance, developing countries, policy coherence, safeguards, dams.

**********

  In all those years since the building of the dam, this is the first
  time someone knocks on our door to ask how we are coping. And,
  frankly, we are not coping at all.

  --Dona Audona Alegre, who was displaced through the Yacyreta Dam,
  Argentina

  With the money and training received in the resettlement process, I
  have increased my herd from five to 38 cows in barely four years
  time. My life has improved dramatically. Praise the Lord!

  --Don Josefino da Silva, who was displaced through the Cana Brava Dam,
  Brazil

  Water that is allowed to enter the sea is wasted.

  --Joseph Stalin

  The problem is not the dam. It is the hunger. It is the thirst. It is
  the darkness in a township.

  --Nelson Mandela

The building and operating of large dams is among the most controversial development interventions that governments, international institutions, or private firms can undertake. This stems in particular from the immense impact that dams have on surrounding communities (e.g., 1.3 million people had to be resettled for the Three Gorges Dam in China) and on the environment (many large dams lead to the flooding of several hundred square kilometers of land). Dams have given rise to such acrimonious debates that a unique multistakeholder process--the World Commission on Dams--was deemed necessary, spanning three years from 1997 to 2000, to address the difficult trade-offs between the economic, social, and environmental benefits and costs of dams. (1), (2)

The institutions that plan and finance dams and similar large infrastructure projects have therefore been under increasing pressure to control these impacts (3) through "safeguards systems" (4) notably for projects in developing countries, where local capacity for implementing such safeguards is often weak. (5) The starting point of this research is that bilateral aid and multilateral aid differ fundamentally. (6) This dichotomy also exists in large infrastructure finance, with the two main kinds of OECD-country public financing institutions (PFIs, my acronym) involved in financing dams in developing countries being multilateral development banks and Organisation for Economic Co-operation and Development (OECD)-country bilateral PFIs, consisting mostly of export credit agencies (ECAs). In three OECD countries--the United States, Japan, and Germany--the national development financing institution is also heavily exposed to dam financing.

Given that much of the vast amount of capital needed to build large dams in developing countries continues to originate from these OECD-country PFIs, this article asks whether social and environmental safeguards systems are applied with the same degree of stringency by all relevant types of PFIs financed wholly or mostly with OECD-country public money. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Policy Coherence for Sustainable Infrastructure in Developing Countries: The Case of OECD-Country Public Financing for Large Dams
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.