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Safeguard Policies: Introduction and Overview Agi Kiss Safeguards Coordinator, Europe and Central Asia Region WB Safeguards Workshop Ankara, March 2010 1 Slide 2 OUTLINE Safeguard Policies Objectives and principles Overview of Safeguards Policies (10 + 1) Details: OP 4.01 (Environmental Assessment) and OP 4.12 (Involuntary Resettlement) Procedures: who does what and when 2 Slide 3 Do no harm: protect people and environment from adverse impacts Do good: enhance social equity and promote environmental sustainability Reduce and manage risk for the Client and for the WB Respond to a world-wide constituency 3 Slide 4 4 2. Overview of Safeguard Policies Slide 5 Legal Policies OP 7.50 International Waterways OP 7.60 Disputed Areas Environmental Policies OP 4.01 Environmental Assessment OP 4.04 Natural Habitats OP 4.09 Pest Management OP 4.36 Forests OP 4.37 Safety of Dams Social Policies OP 4.11 Physical Cultural Resources OP 4.12 Involuntary Resettlement OP 4.10 Indigenous Peoples BP 17.50 Bank Disclosure Policy Not all environmental/social issues of concern are covered by Safeguard OPs SG apply to all Investment Operations, and to any Investment sub-components within Development Policy Operations 5 Slide 6 Operational Policies (OP) concise statement of policy objectives and operational principles including the roles and obligations of the Borrower and the Bank Bank Procedures (BP) Mandatory procedures to be followed by the Borrower and the Bank Good Practice (GP) Non-mandatory advisory material 6 Plus: EA and Involuntary Resettlement Sourcebooks Pest Management Guidebook Regulatory Framework for Dam Safety Pollution Prevention Abatement Handbook OPCS Guidance Notes Slide 7 Avoid negative impacts where possible; otherwise minimize, reduce, mitigate, compensate (in that order) Match level of review, mitigation and oversight to level of risk and impacts Inform the public and enable people to participate in decisions which effect them Integrate environmental and social issues into project identification, design and implementation Strengthen Borrower capacity 7 = Ingredients of Sustainable Development Slide 8 To inform decision makers of the nature of environmental and social risks To ensure that projects proposed for Bank financing are environmentally and socially sound and sustainable (promote positive impacts, avoid/mitigate negative impacts) To increase transparency and provide mechanism for participation of stakeholders in the decision-making process for the project 8 Slide 9 Applies to all types of Investment lending (not to Development Policy Lending) ; Triggered: for any investment with a footprint, and for directly related TA Applies to all elements of a WB-financed operation (not only WB-financed activities) and to directly linked investments Umbrella EA policy: comprehensive and subsumes elements of others WB does not finance activities contrary to national environmental legislation or international treaties (should be identified in EIA) Based on screening of operations based on risk level (Category A, B, C) and Project Structure (Category FI) Sets out required procedures; provides guidance on substance EA Instruments (details later) : Environmental Impact Assessment Environmental Management Plan Environmental Management Framework 9 Slide 10 Objectives: Protect, maintain, restore natural habitats and their biodiversity; Ensure sustainability of services and products which natural habitats provide to human society Involve local communities in planning, implementation Precautionary approach to natural resources management 10 Slide 11 Triggered by: investments in, near or likely to affect natural ecosystems (terrestrial, riverine, coastal) even if effects are expected to be positive. Especially but not exclusively relating to Protected Areas, threatened/endangered species Distinguishes between Critical and Non-Critical natural habitats (based on criteria, not list): no WB support for significant conversion/degradation of critical natural habitats Project-financed mitigation, including compensatory set-aside for unavoidable significant conversion/degradation of non-critical natural habitats Assessment/mitigation within EIA/EMP (no separate NH Plan) Mitigation includes Client capacity to implement protection Preparation/appraisal/supervision to include qualified experts 11 Slide 12 Objectives: Support Integrated Pest Management (IPM) approach for sustainable agriculture and health (promote use of biological/ environmental/ agronomic controls, reduced reliance on synthetic chemicals) Reduce human exposure and health risks Reduce environmental contamination Help develop national capacity for IPM and pesticide regulation/monitoring 12 Slide 13 Triggered by: procurement of pesticides; projects likely to introduce, increase or change use of pesticides Assess issues through EA process Mitigation through EMP or separate Pest Management Plan depending on nature and scale of issues Pesticides may be financed in context of IPM (following criteria for pesticide selection and handling) No BP 4.09 - Pest Management Handbook (online) 13 Slide 14 14 IP = distinct, vulnerable, social and cultural group attached to geographically distinct habitats or historical territories, with separate culture than the project area, and usually different language Objectives: n To foster full respect for human rights, economies, and cultures of IP n To avoid adverse effects on IP during the project development Triggers: Projects affecting an area currently or historically occupied by IP One of the most controversial and contested OPs insome regions; few applications in ECA (Siberia only) Slide 15 Objective: avoid/mitigate adverse impacts on PCR (sites, structures, natural features of historical, paleontological, religious, other cultural signficance Triggered by: investments in or near recognized cultural heritage sites (or very culture-rich areas) Assessment and mitigation through EA/EMP (archaeological survey, PCR plan if needed) Mitigation may range from full protection to salvage & documentation. Chance finds provision for items discovered during implementation Reliance on national authorities and laws 15 Slide 16 Objectives: Avoid/minimize displacement where feasible Assist displaced persons to improve (or at least restore) pre- project living standards (resettlement as a development program Promote community participation in planning & implementation of resettlement Provide assistance to people regardless of legality of land tenure 16 Slide 17 Objectives: Contribute to sustainable development -- meet demand for forest products and services through sustainable forest management Protect/maintain rights of communities to use their traditional forest areas in a sustainable manner Protect global environmental services and values of forests: avoid encroachment on existing significant areas of forest ensure forest restoration projects maintain/enhance biodiversity & ecosystem function 17 Slide 18 Triggers: projects involving forest restoration, plantation development, changes in forest use, management or protection other projects which could have negative impact on health and quality of existing forests (overlap with OP 4.04) Applies to natural forests & plantations Assessment and mitigation: integrated in EA/EMP Forest harvesting can be financed: by, or with meaningful participation of, local communities in areas not identified as critical forests/critical natural habitats If consistent with principles & criteria of responsible forest management (or adhering to action plan to achieve it) Attention to risk of invasive species Beyond Safeguards: stresses integration of sustainable forest management in policy dialogue, CAS, etc. 18 (Complexity of this revised OP a result of extensive international consultation?) Slide 19 Objectives: protect downstream populations, ecosystems and investments from consequences of dam failure; ensure dams are properly designed/constructed/monitored Triggered by: WB project financing for dam construction or rehabilitation (full application); performance of a WB- financed project is dependent on an existing dam (due diligence) Assessment and mitigation requirements distinguish between large vs. small dams, i.e.: Dam height: (15 m +, or 10 m + with other risk factors Reservoir size Likelihood of later increase in height/size Construction of new large dam requires: independent panel of experts to assess design/construction; detailed plans for implementation including emergency preparedness plan Pre-qualification of bidders Periodic safety inspection after completion Due diligence for existing dams: Inspect/evaluate safety status Review/evaluate owners operation & maintenance procedures Written report of findings, recommendations for remedial measures 19 Slide 20 Objective: ensure projects will not adversely affect: the efficient utilization and protection of international waterways between the Bank and its Borrowers and between states Triggered by: any project which involves use or potential pollution of an international waterway (regardless of scale; upstream or downstream) E.g.s: hydropower, irrigation, flood control, navigation, drainage, wastewater/sewerage, industrial facilities... and detailed design and engineering for all of the above Exemptions: rehab of existing systems which wont adversely change water quality/quantity (no expansion); water source surveys & feasibility studies Tributary running exclusively in most downstream state Ongoing revision: to add de minimus clause, groundwater Action required: early notification of other riparian States (by Borrower or by Bank on behalf of Borrower), with details on potential impacts; Ascertain whether any applicable treaties or other agreements exist If other Riparian(s) object: goes to LEGVP & MD for decision 20 Slide 21 Objective: ensure projects will not adversely affect: Relations between Bank and member countries Relations between Triggered by: Project area known to be disputed; Borrower involved in border disputes Action required: Project may proceed if governments concerned agree. MOP bears a disclaimer that Bank doesnt intend to prejudice the final determination of the dispute 21 Slide 22 For non-FI Category projects involving sub-projects: overall project category is determined by highest category among potential sub-projects EA Category Triggers/Type of ImpactEA Instrument ABroad, diverse, potentially irreversible impacts; major resettlement; conversion of natural habitats; hazardous materials Full EIA; Strategic EA (for programs) BNarrower, geographically limited, readily identified and can be mitigated Partial EA, EMP, EMF, Env. Audit, Hazard Assessment, etc. CNegligible or minimal and easily mitigated None FIUnknown at time of Appraisal (sub- projects) EMF + subproject- specific EIA, EMP, etc. EA Category also depends on the location of the project: e.g. any special characteristics and sensitivities of the project site 22 OP/BP 4.01: Environmental Assessment Slide 23 large-scale conversion or degradation of natural habitats extraction, consumption, or conversion of substantial amounts of forest direct discharge of pollutants resulting in degradation of air, water or soil production, storage, use or disposal of hazardous materials and wastes risks associated with the proposed use of pesticides Significant resettlement or other major social impacts 23 Slide 24 Large-scale infrastructure: ports and harbor development, transport (rail, road and waterways), large- scale water resources management (river basin development, water transfer); dams and large reservoirs, hydropower and thermal power, extractive industries and oil and gas transport; Large-scale agriculture, irrigation, drainage and flood control, aquaculture; agro industries, and production forestry; Major urban projects involving housing development, water treatment, wastewater treatment plants, solid waste collection and disposal; Industrial pollution abatement, hazardous waste management, industrial estates, manufacture and large-scale use of pesticides; and Projects that, regardless of scale or type, would have severe adverse impacts on critical or otherwise valuable natural or cultural resources. 24 Slide 25 Plovdiza Dam, Bulgaria Storage of Chemicals, Kosovo Rijeka Port, Croatia 25 Slide 26 Full EIA (as set out in OP 4.01, Annex B: EA compares project feasible alternatives and their related impacts (including No action) EA addresses indirect and cumulative impacts EIA prepared by independent party (not involved in the project preparation or implementation) 2 public consultations on EIA (on TOR, draft Report) Subject to US Governments Pelosi Amendment (EIA disclosed 120 days before Board presentation) Executive Summary of EIA sent to WB Board 26 Slide 27 almost A Requires detailed EIA but doesnt trigger special Category A procedural requirements almost C Checklist EMP; Environmental standards solid B Requires Partial EA or free-standing EMP 27 Slide 28 Small-scale infrastructure projects: power transmission and distribution networks, rural electrification, mini (run of the river with no major water impoundments) or micro- hydropower projects, small-scale clean fuel fired thermal power plants, renewable energy (other than hydropower), energy efficiency and energy conservation, rural water supply and sanitation, road rehabilitation, maintenance and upgrading; telecommunications, etc.; Health care service delivery, HIV-AIDS, education (with limited expansion of existing schools/buildings), repair/rehabilitation of buildings when hazardous materials might be encountered (e.g., asbestos, stored pesticides); and Small-scale irrigation, drainage, agricultural and rural development projects, rural water supply and sanitation, watershed management and rehabilitation, and small- scale agro-industries, tourism (small-scale developments). 28 Slide 29 Rehabilitation of tertiary irrigation canal, Serbia Hospital rehabilitation, Turkey Wastewater Treatment Plant Rehabilitation, Ukraine 29 Slide 30 OP 4.01 is triggered; some type of EA document (agreed during PCN ISDS review) required prior to Appraisal One public consultation usually on draft EA document Lower end Category B projects often transferred to Task Team/Sector Manager after PCN Problems can arise because environmental aspects often neglected during implementation 30 Slide 31 Category C: Examples Very minor building rehabilitation (e.g. no change in blueprint) Provision of equipment with no significant environmental risks Technical assistance (not directly linked to investment); Institutional development/Capacity Building/Training the project will/might/could finance new construction or building rehabilitation the project provides Technical Assistance or other support which could lead directly to activities which would trigger SG policies any of the above are financed by WB, or Government or other co- financers (covered by overall Project financing plan) 31 Slide 32 Project which supports on-lending (or granting) for sub- projects through a Financial Intermediary Operation must qualify as Financial Intermediary Loan under OP 8.30 E.gs.: SME credit lines, community-driven development, Small Grants Programs, Green Investment Schemes, etc. See Environmental Assessment Sourcebook update on Financial Intermediary Lending, in your binder & on CD IMPLICATIONS: Sub-projects not known prior to approval; Environmental Framework disclosed prior to Appraisal Sub-projects can differ in type, size, risk level, EA Category including Category A sub-projects unless explicitly excluded Category A subproject EIAs Executive Summary goes to WB Board Institutional Capacity, and monitoring/supervision are even more important than for other projects 32 Slide 33 Category FI Project Examples Istanbul Municipal Infrastructure, Turkey Renewable Energy & Energy Efficiency, Turkey Rural Education, Romania Social Investment Fund, Romania 33 Slide 34 Differences between national and WB requirements (Environmental Assessment) Which projects require EA, and who decides Content/structure of EA (e.g. analysis of alternatives; explicit EMP) Timing of EA preparation Who prepares EA (OP 4.01 requires independent for Category A EIA) 34 Slide 35 Pre/Feasibility Study Detail Design Bidding Docs Construction Permit Preliminary EIA incl. mitigation measures Final EIAEnv. Permit (Monitoring) Identification/ Preparation Appraisal Implementation World Bank NATIONAL LEGISLATION EA/EMP 35 Slide 36 Ideally nearly final, but at least: Pass the laugh test (Ron Hoffer) Sufficient to identify and understand (or credibly eliminate) significant environmental risks especially deal breakers Potential reputational risks Sufficient for meaningful consultation with Stakeholders 36 Slide 37 Its all about the land Indicators for OP 4.12: Investment with a physical footprint (needs land) New construction or expansion of infrastructure; land use changes The land is being occupied or used by someone Legal or illegal/informal; permanent or sporadic; verify on the ground! Resettlement Land Acquisition X 37 OP/BP 4.01: Involuntary Resettlement Slide 38 Loss of land or land-based assets Loss of access to land or land-based assets Loss of shelter /relocation of residence Loss of income sources or means of livelihood (whether or not the affected persons must move to another location) Restriction of access to legally designated parks and protected areas that result in adverse impacts on the livelihoods of affected persons 38 Slide 39 OP 4.12 applies to: all projects involving land take regardless of the total number of people affected or the significance/severity of impacts all components of the project involving land take, regardless of the source of financing other activities requiring land take that are linked to WB: directly and significantly related to a Bank-assisted project, necessary to achieve its objectives as set forth in the project documents, and carried out, or planned to be carried out, contemporaneously with the project both privately owned and public lands both public and private investments 39 Slide 40 The many faces of land acquisition/involuntary resettlement 40 Slide 41 Loss of income not relating to loss of land/land-based resources (e.g. labor retrenchment) Access restrictions resulting from community based natural resource management (WB ascertains appropriate decision-making process in place) Regulation of NR on a national or regional level to promote sustainability (e.g. watershed management, fisheries management, land use planning) (Footnote 8 being clarified post- Albania Coastal Zone project) Disputes between private parties in land titling projects Beyond OP 4.12: it is good practice for the borrower to undertake a social assessment and implement measures to minimize and mitigate adverse social impacts, especially those affecting poor and vulnerable groups. 41 Slide 42 WHO IS ELIGIBLE: WB requires compensation/ assistance to informal land users & occupants (squatters and encroachers) VALUATION: WB requires compensation equal to replacement value of land/assets BEYOND COMPENSATION: WB requires assistance for restoration of livelihoods (not worse off as result of project) TIMING: WB requires compensation/assistance provided in full prior to beginning implementation of works 42 Slide 43 OPTIONS: Safest and most flexible: assume or anticipate possibility of need for land acquisition trigger OP 4.12 & prepare Resettlement Policy Framework Riskier and limiting: confirm with Client that sub-projects requiring land acquisition will be excluded dont trigger OP 4.12. Ensure Client understands broad scope of Land Acquisition Include in Ops. Manual, Legal Agreement Need to monitor/supervise Changing later will mean 1 st Order Restructuring!! Failing to notice a problem may lead to Inspection Panel!! 43 Slide 44 Resettlement Policy Framework (RPF) Resettlement Action Plan (RAP) Process Framework (PF) Separate Presentation on Resettlement Instruments 44 Slide 45 SG policies apply to all project activities, regardless of source of funding (WB, Government, co-financers) SG policies apply outside immediate project boundaries to areas of influence (defined during scoping stage) Some SG policies are triggered even when expected impacts are positive (e.g. Natural Habitats, Forestry, Indigenous Peoples) TA projects can trigger SG policies if directly linked to investments Compliance with SG policies is everybodys responsibility 45 Slide 46 Who Does What and When 46 Slide 47 World Bank Screens and Sets Project EA Category Advises Borrower on the Banks EA requirements Reviews and gives No Objection for EA reports (Due Diligence instruments) Makes report available in Info shop Supervises implementation of EA/EMP Makes mutually agreeable changes during implementation Borrower Prepares and Implements EA/EMP/EMF in accordance with national laws and WB OPs Consults project-affected groups and local NGOs Discloses draft/final documents in country Responds to Bank and public Monitors implementation of EMP Ensures compliance under national laws 47 Project TeamSG Unit Slide 48 WB Board (representing Donor & Borrowing Countries) identifies needs and approve policies Operations Policy and Country Services Unit (OPCS) and Legal Dept (LEG): draft OPs, BPs, set Bank-wide standards for interpretation and compliance, report to Management and Board ECA Region Safeguards Unit: (in consultation with Task Team and as needed with Senior ECA Management and/or OPCS, LEG): for each project, determines which OPs are triggered, appropriate EA category & specific compliance requirements; approve Due Diligence instruments (may delegate); clear Appraisal and Legal Documents; WB Task Team: work with Borrower and SG Unit to ensure appropriate triggering/screening; advise Borrower on compliance throughout project cycle; evaluate Due Diligence instruments and Client capacity; disclosure (Infoshop); verify and report to Management throughout project cycle Quality Assurance Group (QACU) and Internal Evaluation Group (IEG): Review performance of WB Staff and Management and quality of operations vis a vis SG (application, compliance, implementation, impact) Inspection Panel: Investigates complaints by affected people; Reports independently (makes recommendations) to WB Board 48 Slide 49 Project Team Including (where appropriate): Environmental Specialist Social Specialist Selected by TTL in consultation with SM Time charged to Project budget RSC & Safeguards Review Team Including: Environmental Safeguards Reviewer Social Safeguards Reviewer Selected by RSC Time charged to SG budget (ECAVP) 49 Slide 50 Project Team: Prepares PCN-ISDS; requests ISDS review meeting; proposes EA Category Prepares Risk Identification Worksheet Guides/assists client; Reviews & NOB for TORs, EA for most Category B projects Prepares PAD, including E/S analyses and Annex 10 Prior to Appraisal: ensures disclosure & consultation requirements met (With lawyer) prepares Negotiations package, including any Env. provisions Supervises EMP implementation, & documents in A-Ms, ISRs and ICR Safeguards Unit*: Reviews/clears ISDS/confirms EA Category Reviews/comments on RIW Guides/assists Project Team; Reviews/clears TORs, EA for Category A projects Clears Appraisal Stage ISDS & Appraisal package if all requirements are met (or delegates this to Sector Manager) Clears Negotiations package (unless delegated to SM) Selectively reviews A-Ms, ICRs, advises Project Team Carries out thematic reviews, liaises with OPCS, etc. 50 Slide 51 Prepare PCN & PCN stage ISDS PCN stage ISDS mtg. & clearance Provisional EA category; agreement on SG requirements PCN review mtg. QER Follow-up SG meeting (?) Prepare draft PAD & Appraisal Stage ISDS Appraisal stage ISDS mtg. & clearance Decision Mtg. Negotiations Appraisal EA/EMP & RFP/RAP disclosure & consultation Preparation of EA/EMP; RPF/RAP Effectiveness Implementation Disclose final EA/EMP; RFP/RAP SG implementation & supn/reporting Transfer to SM 51 Slide 52 52 Slide 53 Credit Lines: (presentation on Env. Frameworks) Rapid Response (OP 8.00): SG apply but with flexible timeframe Additional Finance: Summarize status of EMP, RAP implementation to date support with evidence of monitoring/supn New ISDS required only if new SG issuesotherwise update, resubmit existing ISDS to Infoshop with current date Restructuring: Elevation of SG category to Aor triggering of new SG policy = Level One restructuring and ISDS updated, cleared Investment Lending Reform: Stay tuned 53 Slide 54 SG as entry point place at the table, demand concrete data, make trade-offs explicit Applying SG: necessary but not sufficient, esp. for social risks (Env. SG policies fairly comprehensive; Social SG policies quite narrow) Risk of negative impacts vs. reputational risk Due diligence approach for legacy projects, add-on investments Role of Inspection Panel positive and negative (objectives/substance vs. procedures) 54 Slide 55 In Principle: High priority for some WB Board members, pushback form others No Brainer for EU member/accession countries (?) From project to sectoral/national level In Practice Safeguards Diagnostic Review: Equivalency and Acceptability and Gap Filling Does not change WB fiduciary requirements, Pelosi, etc. How different in the end from usual approach? In practice, limited demand from internal/external clients 55 Slide 56 LAST WORDS 56 Slide 57 URGENT NEEDED TODAY FAST Board Date Immediately Needed Yesterday ASAP Ministers Request Pronto!Pronto! RUSH COB Soonest Quick Turnaround Hurry O v e r d u e Due today ReminderReminder Pelosi deadline this afternoon PRIORITY Safeguard compliance is a lot easier and more effective if you find out whats needed early and plan ahead The biggest headaches come from trying to fix problems retroactively 2-hour (or 24 hour) turn-around time is not the service standard for SG review 57 Slide 58 THE END 58