World Bank Degradation
THE WORLD BANK IN JUNE approved an infrastructure project in Mexico that environmental organizations say marks a watershed in weakening the Bank's social and environmental standards.
The $108 million investment loan will finance a series of infrastructure projects in the Mexican state of Guanajuato.
What was novel about the loan is that the Bank has agreed to set aside its own environmental and social safeguard policies and to instead rely on Mexican laws and procedures, many of which do not meet the Bank's existing standards.
The project is the first major pilot of a new middle-income country strategy that the World Bank is currently preparing. The strategy calls the Bank's social and environmental safeguard policies "obstacles to timely quality lending," and recommends that future Bank projects rely only on national social and environmental standards rather than the Bank's own safeguard policies.
Just prior to approval of the Mexico loan, nearly 200 nongovernmental organizations from 60 countries sent a letter to the World Bank protesting its proposed new policy. …