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CHAPTER 1
Greening the New World Order?
'The Future of the Earth ... in our Hands'; The GEF in Context; Establishing the GEF; The GEF in Practice; Understanding the GEF; Outline of the Book; Conclusions
'THE FUTURE OF THE EARTH ... IN OUR HANDS'
Each of you is preoccupied with issues at home – important issues, sometimes urgent issues. But let me submit to you that none of these will be nearly as important to the future of your people as the issues here ... The future of the earth as a secure and hospitable home for those who follow us is in our hands. (Maurice Strong speaking to assembled world leaders at the United Nations Earth Summit in Rio de Janeiro, Brazil, June 1992)
Ten years on from the Rio Earth Summit and 30 years from the UN Conference on the Human Environment in Stockholm, the world's governments, corporations and 'civil society' are once again being roused from day-to-day political and economic survival to talk about the future of all our people, our home planet, and the other species we share it with – at the 2002 World Summit on Sustainable Development (WSSD) in Johannesburg, South Africa. But the indications are that just as in Stockholm and Rio, reordering the international economy – or even securing corporate accountablility – is off the agenda, so, despite all the global hype and new initiatives, nothing much will change.
I make this prediction on the basis of not only reports from WSSD's preparatory processes, but also the findings presented below. The subject of this book is the Global Environment Facility (GEF), a publicly funded multi-billion-dollar green aid fund created in the World Bank by Western governments in 1991 – just in time for Rio. The GEF was charged with financing protection of the 'global environment' and, thereby, 'sustainable development', and has supported thousands of international conservation projects, mostly justified under the UN Framework Convention on Climate Change (FCCC) and the UN Convention on Biological Diversity (CBD). Yet as an avowedly 'non-political' body, the GEF's governing Council does not challenge the often anti-environmental priorities for international extraction of and investment and trade in natural resources of its donor governments or the World Bank, International Monetary Fund (IMF) and World Trade Organization (WTO).
In fact, the growing environmental movement challenging the World Bank and IMF in the late 1980s was partially headed off at the pass with the help of GEF's new conservation money. Billions of additional aid dollars promised for conservation projects eclipsed Southern and radical Northern environmentalists' claims for global ecological justice, environmental regulation on international trade and full and fair cost-benefit analyses of economic investments to ensure the polluter always pays. Suggesting that governments were, after all, willing to commit to environmental action, the GEF's additional green aid was also intended to bring in new partners and co-ordinate existing international institutions to respect the global environmental commons. Thus the World Bank could turn its critics into consultants – accepting their advice within limits, offering project contracts and promising participation in the catalysis of global capital's evolution towards sustainability.
A publicly funded experiment, the GEF was intended to generate lessons for a mission in which – as the UN Environment Programme (UNEP), created 20 years earlier, had already found to its cost – there are no easy answers. So far little known and less understood, the story of the GEF may shine a light on conservation and colonialism, capitalism and complexity, compromise, co-option and commodification in a rapidly transforming world. It may even suggest things that could be done differently – more fairly and effectively – in future innovations for global environmental security.
THE GEF IN CONTEXT
Despite early talk of a 'peace dividend' after the end of the Cold War benefitting the world's poor people and natural environments, official aid has generally declined while weapons spending and hot wars for resources have continued apace since the announcement of a US-led New World Order by George Bush I in 1991. The same year, the GEF entered into operation: an adaptation to the institutions of this emerging global 'order' in response to the rise of environmental movements which were becoming a geo-political force.
In the 1980s the green movement, growing internationally and especially in the US, faced intense resistance from powerful established interests: firms, bankers and politicians profoundly irritated and sometimes partly convinced – by multi-pronged ecological challenges to business as usual. The GEF was a strategic response by some of 'those who claim maturity and legitimacy' in the global 'centres of political life' (Walker, 1995). While financing the UN multilateral environmental Conventions (see below) the GEF also served to draw the aspirations of a growing environmental movement into running discrete conservation projects and reforming the World Bank – one of the Bretton Woods 'family' of global financial institutions that includes the IMF and latterly the WTO.
Created in 1945, the World Bank and IMF intervene in the international economy primarily in the interests of their major shareholders – the US and Western European economic powers. Since the 1980s these institutions, joined by the WTO in 1994, have also promoted the 'Washington Consensus' of neo-liberal policies, which make life easier for big business, if not always the people and places affected (see Chapter 2). For example, in promoting fisheries 'development', the Bank may offer a government credit to buy large boats, refrigeration and processing factories to serve global markets, but takes next to no responsibility for the resulting decline of fish stocks and local markets and immiseration of artisanal fishing communities, let alone damage to marine ecosystems and spawning grounds by industrial-scale fisheries. Opening some middle-income countries' economies and resources to ever more foreign investment may have created a degree of economic advancement for some, but damaging environmental consequences combined with displacement, hunger and recurrent resource riots across the South, along with economic collapses from East Asia and Argentina to Enron, suggest that all is not well with the model – even if the long-term decline of so many African countries under neo-liberal policies is ignored, as is so often the case.
As this book is completed in 2002, the GEF's official evaluators cannot advertise any serious impact on the rate or causes of global environmental change – indeed, they lack the time, resources and remit to examine the details of grass-roots situations where change may or may not be occurring. At the global level, despite isolated green achievements (for example, the growth of the hole in the ozone layer may be slowing), most forms of pollution are still rife, the climate still seems to be changing, countless plant and animal species and varieties are still going extinct, landscapes, water bodies, fertility and ecosystems are still being degraded or destroyed through ill-considered and unsustainable exploitation – according to the UNEP's scientists as well as the various environmental non-governmental organizations (NGOs). Despite ten years of the GEF's reforming efforts (not to mention 30 years of the UNEP's), fierce critiques and mass demonstrations are again gathering against the very legitimacy of the international financial institutions, opposing the ecological as well as social consequences of the policies they enforce (, ).As banks, corporations and their allied professional classes try once more to pacify popular ecological concerns and separate them from resistance to the capitalist system itself, what further institutional reforms – and difficulties – are likely? Will available funds, expertise, attention and political initiative be used more effectively for environmental protection in future? If governments were unable to come up with an effective solution when there was mass popular interest in conservation in the late 1980s and early 1990s, what hope is there for less compromised solutions now that international attention has largely moved on to focus more on hunger, trade and war?
With US military ambitions for 'full spectrum dominance' of the globe and the bleeding of a so-called 'war on terror' into something like a war on dissent, most of the biggest and especially Washington-based environmental NGOs are working with the World Bank and/or the GEF, and are politically wary of seeming to attack what now passes for the US government's 'national interest'. Whatever their aspirations, hopes and promises, can real-world solutions to widely distributed environmental problems really all be channelled through a largely Washington-based community of environmental professionals whose jobs depend, in the final analysis, on the surplus and favour of the US' and Western Europe's globalising corporate empires?
ESTABLISHING THE GEF
In a world of realpolitik the assumption that states signing ever more demanding treaties could solve global environmental problems becomes 'inadequate and politically naive' (Paterson, 1995). Treaties and conventions facing crises of implementation require financial as well as political support if they are to approach the desired impact. The GEF therefore inspired new hopes in some environmental and diplomatic circles because, unlike other global environmental initiatives, it had the powerful World Bank behind it and billions of dollars of real money to spend. But, for reasons explored further below, the same facts also invited pessimism and mistrust.
The GEF was initially created by World Bank staff and a few officials in Western European government ministries as a 'green window' of the Bank, intended to finance projects supportive of the United Nations Conventions on Biological Diversity Climate Change. These major UN Conventions were due to be signed, by governments, at meetings associated with the Rio Earth Summit in 1992, having been negotiated in response to intense environmental pressure on especially Northern governments. Some sort of fund was needed to persuade Southern governments to agree to the conservation and the constraints on their national development implied in the Conventions. The Northern donors did not however want to become liable for all the potential costs arising from the treaties, nor to put more money into the United Nations system – with its relative accountability to Southern governments and 'inefficient' political debates and processes. The rich Northern governments also wanted to reform existing international institutions to be more efficient but without alienating their allied banks and corporations by regulating the terms of global trade and investment for the sake of environmental protection.
The 1987 UN-hosted Multilateral Fund for the Montreal Protocol (to counter depletion of atmospheric ozone) had set a precedent for global environmental finance that was not welcomed by the major donor government treasuries, because it allowed all governmental participants in the Protocol a say in the spending of its funds. The Climate and Biodiversity Conventions involved far more politically loaded and complex issues to deal with than ozone. Therefore, when it came to financing them, donors ignored the Montreal Protocol's precedent. Instead they established the GEF to keep the implementation of the new Conventions under the World Bank's legal authority. Building on a reputation for political conservatism, the Bank promised its major donors a 'business-like' approach to 'valuing the environment' and financing 'sustainable development'.
In the lead up to Rio, the quietly established GEF attracted opposition from Southern governments and non-governmental organisations mistrustful of an opaque entity, a fait accompli, based in a World Bank accountable to 'donor' rather than 'client' governments, let alone to environmental science or popular movements. In the light of the World Bank's past investments and unfavourable experiences with the GEF so far, some said giving the Bank responsibility for global conservation was like putting a fox to guard chickens. They argued instead for reparations for the damage done to Southern and global environments by Northern expansionism, as well as help for the billions of people whose environmental priorities are more immediate, for example clean water to drink and air to breathe.
The donor governments, however, would not prioritise such local and domestic ('brown', rather than 'green') environmental issues which attracted relatively little interest from their attendant community of vocally global 'green' NGOs. Rejecting what they called 'rhetorical issues', the donors designed the GEF to pay neither the costs of environmental damage from earlier 'development' nor all the possible costs of implementing the Conventions on Climate Change or Biodiversity in the South.
Nonetheless, for all its consequently limited appeal to those with more immediate problems, the GEF was the only new source of multilateral aid on offer at Rio, and, in response to its many critics, the donor governments promised to review and restructure the GEF to operate more openly, accountably and participatorily. It was made nominally independent of the World Bank and charged with supporting the 'national development priorities' of recipient governments, while making global 'partnerships' – not least with green NGOs and the private sector. A sufficient number of Southern governments and international environmental interests therefore accepted the promise of funds, innovation and access, for the GEF to be refinanced in 1994 and designated 'interim financial mechanism' to implement the Conventions on Climate Change and Biodiversity.
Nevertheless, despite the fact that the UNEP and the UN Development Programme (UNDP) were brought in to help the World Bank implement GEF projects, the Bank remained institutional parent and trustee of GEF funds. Publishing a 'GEF glossary', it literally defined the terms under which experimental global environmental aid was made available in the 1990s. Through its effective control of the GEF, the World Bank has been able to bring its economistic vision of development into what was previously UN territory of global environmental protection.
THE GEF IN PRACTICE
Raising and Spending Money
GEF funds promised to be 'additional' to other aid flows, but would finance only the 'incremental costs' of achieving 'global' environmental benefits through actions taken under the Conventions. Essentially, the GEF pays only for the extra costs of development projects that protect international waters, atmospheric ozone, biodiversity and the climate system: environments deemed to be of 'global' value.
In the ten years since it was created, the GEF has channelled $4.1 billion from mostly North American, Western European and Japanese treasuries to over a thousand projects in over 150 Southern and former communist countries. To put its work in context however, GEF funds constitute less than 1 per cent of total international aid flows to the South, and offer the equivalent of one day's global spending on military 'defence' for each year of protecting the global environment. Even so, the Washington DC-based GEF currently has about three times as much money to spend each year as the UNEP – based faraway from donor treasuries in Nairobi, Kenya. The GEF's well-funded arrival on the international scene therefore led one UN official to liken the Facility to 'a new wife for the donor governments, favoured over old, tired UN bodies'.
The initial, 'pilot' phase of GEF funding ran from 1991 to 1994; it was promised $1.6 billion. Major donors to the pilot phase were the French and German governments with nearly $150 million each; the US and Japan contributed similar amounts indirectly through 'co-financing' (see Chapter 3). A small group of Southern governments also paid up to $6 million each at the start – their 'fee' to join a new conservation 'club' and share in the $733 million actually spent on GEF projects in countries with a per capita GNP below $4,000 in 1989. For the 1995–8 GEF 'operational' phase, which promised to 'build on the lessons' of the pilot phase, donors promised a total of $1.8 billion – but again, only about half the promised sum was spent, on mostly quite large development projects: for example, for renewable energy technologies and protected areas, the mapping of genetic resources, sources and sinks of 'greenhouse gases' and preparation of plans for their management. The rest of the money was carried over in 1998 when the GEF was replenished with an advertised $2.75 billion to last until 2002.
Though the total sum promised had risen again, it was in this context that some people from the South described the GEF as 'a con'. The longer time period and a carry-over of about $860 million, much of it not yet even raised from late paying donors, meant the real contribution from these governments would quite possibly decline – making careful distribution of precarious funding all the more important.
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Excerpted from "A New Green Order?"
by .
Copyright © 2002 Zoe Young.
Excerpted by permission of Pluto Press.
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