Tag Archives: investment

Improve Devlopment Lending to Build Resilience

Andrew Revkin writes in the New York Times about a recent world bank report that finds that the world bank is not lending in ways that invest in natural capital or resilience (The report is online at worldbank.org/oed). However, there is increasing awareness that that is a big problem.  Revkin writes that the report states that:

it was vital for the bank and its partners to intensify their focus on measurable environmental protection, given rising vulnerability to environmental risks and the increasing flow of financing for projects related to climate change.

“They need to begin to see the inextricable link between sustaining environment and reducing poverty,” Vinod Thomas, the director-general of the evaluation group, said in an interview. “It is clear now from the Amazon to India that if environmental sustainability is not raised as a priority then all bets are off.”

… Cheryl Gray, the director of the review group for the World Bank, said the lack of consistent internal tracking of the environmental facets of projects was an indicator of how much work needs to be done.

The World Bank Group approved its first set of common environmental standards in 2001, for the first time making environmental stewardship part of its core mission of reducing poverty.

But the new evaluation found a persistent lack of environmental focus in each step along the lending chain — from the priorities that shape development projects to the environmental standards and monitoring required in the field.

Revkin also asked the report’s authors about World Bank’s lack of investment to reduce or mitigate disaster damage. On Dot Earth Revkin quotes

Vinod Thomas, the director-general of the World Bank Group’s independent evaluation group, said a recent report on the Bank’s work on disasters found the same problem. “The bank has done well on the reconstruction side,” he told me. “But even where disasters recur, the preventive side gets neglected, for political reasons. Reconstruction gets photos.”

Things appear to be improving, though, Mr. Thomas said, partly because analysts for the bank and its lending partners are running the numbers on the economic benefits of resilience. “The rate of return on prevention can be 4 to 12 times the investment,” he said.

Often, he noted, there is no inconsistency between environmental conservation and resilience to disasters. He cited the example of maintaining coastal mangrove forests as a buffer against flooding. Communities bounded by mangroves persist while those exposed to the waves vanish. There’s no need to crunch numbers to figure that out.