Hidden agenda: is multilateral aid protecting the environment?

Hidden agenda: is multilateral aid protecting the environment?

Hidden agenda: is multilateral aid protecting the environment?

The Global Environment Facility (GEF) is the newest addition to the Bretton Woods family of international financial institutions. GEF has for a decade supported the implementation of the United Nations (UN) conventions to limit climate change and protect biodiversity by financing selected groups in eligible countries. Praised by some as a breakthrough in global environmental governance but criticised by others as panacea for a sick institutional system, GEF is now successfully marketing itself as innovative and participatory. Analysis by the University of Hull of the GEF as an institution and a process, concludes that the complexity and often conflicting political demands on bureaucracy hamper its avowed objectives.

GEF policies are intended to promote cost effective investments to protect the global environment. Objectives include promotion of eco-tourism, green energy technology and energy efficiency to reduce greenhouse gas emissions. The appeal to donor treasuries is the promise to fund only the extra or incremental costs of global, rather than local or national, environmental benefits 'agreed' to derive from World Bank and UNDP client countries. GEF-financed global environmental benefits are delivered through projects that comply with the above UN conventions and/or combat desertification, ozone depletion and pollution of international waters.

How are GEF's large-scale funds helping the environment? The GEF began as new multilateral aid for the World Bank to meet the promises of the Rio 'Earth Summit' in 1992. It aims to have spent around $5billion of public money by 2002. Whilst it is difficult to assess the impact of GEF aid on specific environments, argues the research report, political analysis can suggest who has benefited, who has lost out, and why. Key research findings include:

  • Governments have handed responsibility for spending money to un-elected administrators, often unrepresentative NGOs and ‘expert’ advisers mostly educated in, if not originating in northern countries.
  • Over two-thirds of GEF-financed procurement is from OECD countries.
  • GEF decision-makers are not accountable to national parliaments but gain many privileges and influence from government nonetheless.
  • Decisions are often made concerning policy and operations without input from those who will be affected adversely.
  • Intensive politics is glossed over in public leaving many decisions hostage to powerful private interests.
  • Civil servants at national and global levels must maintain government support for their institution and raise funds for 'replenishment'.

A main weakness is the difficulty in moving projects through the system to effective implementation on the ground. In this context, policy lessons include:

  • Key stakeholders within GEF institutions need to resolve their differences in public to ensure continuing support.
  • Environmental economists will need more diverse inputs as well as clarifications to their calculations of incremental costs for global environmental benefits.
  • Donor governments' inconsistent demands have made administration unwieldy and ineffective. The GEF will need their help to integrate environmental governance fairly, effectively, and cheaply.
  • The GEF's relative openness and dependence on NGO and government support creates unprecedented political space in Bretton Woods Institution.

The complex and often conflicting politics of GEF's governance may have left the door open for transnational corporate interests and scientific and political élites to define the global environmental agenda according to their own priorities. As the World Bank encroaches further into UN territory, this deserves more attention.

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