Planafloro/Insp. Panel - 3 of 3 (fwd)
Robert Johnson (johnsorl@COLORADO.EDU)
Sat, 29 Jul 1995 16:26:34 -0600
---------- Forwarded message ----------
Date: Thu, 27 Jul 1995 00:21:02 -0700
From: C Soren Ambrose <soren@igc.apc.org>
To: johnsorl@colorado.edu
Subject: Planafloro/Insp. Panel - 3 of 3
/* Written 11:11 AM Jun 21, 1995 by ax:foeamazonia in igc:rainfor.worldb */
/* ---------- "Planafloro/Insp. Panel - 3 of 3" ---------- */
V. Investment Programs/Media Program
5.1 Planned Actions in PLANAFLORO
According to the World Bank's Staff Appraisal Report, the
institutional reform program in PLANAFLORO should include,
among other measures:
- the elimination of economic and fiscal incentives that encourage
inefficient resource allocation, non-sustainable private
investment and environmental degradation
- the revision of Federal and State investment programs, to take
into account land use capabilities and other environmental
considerations
During negotiations on the loan for PLANAFLORO, the
Federal Government and the State of Rondtnia provided
assurances that institutional reforms at the state and
federal levels would be implemented during the execution
of the program.
Furthermore, it was agreed that by September 30 of each
year, the State would send to the Bank, for analysis and
commentary, any modifications in the investment programs
foreseen for the next year (Section 2.14 of the Project
Agreement; Section 3.04 of the Loan Agreement).
The institutional reform program further anticipate the
use of an informative media program, aimed at:
the reduction of the rate of spontaneous migration to Rondtnia,
through the dissemination of information in other regions of the
country, especially in states from which most migrants originate,
to explain the agro-ecological zoning and the State's new policies
on land occupation. (IBRD 1992:50)
5.2 Evidence of Deviations
With regard to investment policies and the media program,
as defined in the official documents of PLANAFLORO, the
following facts should be noted:
5.2.1 Rural Credit
Within PLANAFLORO, a rural credit fund (FUNDAGRO) was
created, with the goal of encouraging the adoption of
agroforestry systems among small farmers in Rondtnia.
However, there are other rural credit programs in Rondtnia
with a much larger volume of resources, the directives and
priorities of which have not been made compatible with
the objectives of the state's zoning and PLANAFLORO. This
situation compromises the effectiveness of project
initiatives.
For example, the Bank of the Amazon (BASA) through the
Northern Constitutional Fund (FNO) has privileged the
expansion of cattle ranching in the State of Rondtnia. In
1994, BASA projected investments on the order of US$ 32
million, benefitting 3,800 projects in the livestock
sector. In contrast, for agricultural sector BASA set
aside only US$ 4.3 million in FNO funds for approximately
1,700 projects.
Recently, it was confirmed that BASA approved subsidized
financing for a large cattle ranching project using FNO
funds, to benefit a large property with a land title that
was irregularly granted by INCRA, within the limits of the
Rio Abunc State Forest. In reality, the interested party
is the "owner" of six landholdings totalling approximately
2,500 hectares, all of which received titles (CPCVs)
issued by INCRA in 1991, following creation of the Rio
Abunc State Forest (Decree no. 4.572 of 3/23/90).1
5.2.2 Fiscal Incentives
As an example of the lack of coherent criteria in fiscal
incentive policies, it can be verified that SUFRAMA has
conceded exemptions from the Industrialized Products Tax
(Imposto sobre Produtos Industrializados - IPI) to logging
companies operating within zone 04, as in the example of
the region of PA Buritm (municipality of Campo Novo).
5.2.3 Road Transport
In the elaboration of PLANAFLORO, it was defined that the
Department of Highways (DER-RO) should elaborate a "State
Road Plan", identifying all existing and planned rural
roads and highways in Rondtnia and ensuring their
compatibility with the socio-economic and ecological
zoning plan. However, to date, the State Road Plan and
its respective map have not been presented by DER-RO.
In the absence of a road plan for the State of Rondtnia, a
series of problems have occurred, including the
following:
1. Typically, the opening and maintenance of rural roads are
carried out by municipal governments (with the collaboration of
logging companies and other interested parties) which do not
recognize the state zoning plan or other pertinent environmental
legislation. For example, the governments of Nova Mamori and
Campo Novo have agreed to the opening of highway BR-421, which
runs through the Karipuna Indigenous Area, the Guajara-Mirim State
Park and part of the upper Rio Jacm-Parana area which is located
in zone 04 (non-timber forest extraction).
This situation was communicated by the Forum in a previous
correspondence to the World Bank (ANNEX 3.D) and was
recently the object a denunciation by CUNPIR (Coordination
of the Union on Indigenous Peoples and Nations of
Rondonia, Northern Mato Grosso and Southern Amazonas) to
the UN Human Rights Commission, in a letter dated May 10,
1995 (ANNEX 4.K)
2. In 1993, DER-RO published a state road map that displayed
several planned roads that would be inconsistent with the state
zoning plan and the existence of several conservation units (ANNEX
15.B). As previously mentioned, DER-RO has not yet published a
substitute map. Without an official government map for reference,
commercially-produced maps of the state (including those used in
schools) have typically displayed projected roads that traverse
indigenous areas and other conservation units.
5.2.4 Energy Sector
Currently, ELETRONORTE is planning to construct the
Ji-Parana Hydroelectric Plant in Rondtnia, with a 512 MW
capacity and investments of US$ 780 million (over three
times the cost of PLANAFLORO).2 The construction of the
plant is scheduled to begin in 1995, with an estimated
completion date of March 2003.
It should be emphasized that the Ji-Parana dam will flood
an immense area of forest along the Ji-Parana river,
including portions of the Jarz Biological Reserve and the
Lourdes Indigenous Area, as well as the lands of
approximately 5,000 small farmers.
In spite of the significant social and environmental
impacts foreseen, an analysis of alternative investments
has not yet been realized. Public hearings have also not
been held, a step required by Resolution 001/86 of CONAMA,
with respect to the EIA/RIMA elaborated for the said
plant.
5.2.5 Media Program
The informative program about PLANAFLORO and the state's
socio-economic and ecological zoning plan, outlined in
Section 2.09 of the Project Agreement, was never
implemented by the Government of Rondtnia. Obviously, the
annual revisions of this program, which were to be sent by
November 15 of each year to the World Bank (according to
the institutional reform program of PLANAFLORO) were also
never realized.
Contrary to the requirements made in the contractual
agreements of PLANAFLORO, the Government of Rondtnia has
disseminated distorted information in the media regarding
the reality of the State. An example of this fact is the
publicity entitled "Rondtnia: The Frontier of Progress"
that was published as a 16-page "Special Informative
Bulletin" in a recent edition of "ISTO I", a national
weekly magazine of wide circulation within the Brazilian
business community. As an example of its contents, we cite
a passage of the document that refers to PLANAFLORO:
In spite of its positive results, there are those who do not agree
with the program for political reasons. "The implementation of
PLANAFLORO was greatly delayed because of NGOs, who, for political
opposition, pressured the World Bank to interrupt the program"
says Governor Piana. "But fortunately we were able to overcome
these obstacles."
The results are evident. The clearing of virgin forests, which in
1985 reached an unbelievable two million hectares -- an area which
corresponds to two times the size of Belgium -- has now fallen to
around 40 hectares (sic).
The existence of an informative program in the media is
fundamental when considering the current level of
misinformation among the general public about PLANAFLORO
and the socio-economic and ecological zoning plan. Aside
from the type of publicity cited above, this
misinformation is due, in large part, to the declarations
of politicians in the media. These politicians typically
argue that: i) the state zoning legislation is a
"straitjacket" which is impeding the development of the
State, ii) the state zoning and its environmental concerns
are impositions of the World Bank and iii) PLANAFLORO
represents "too little money" for the government and
businessmen to relinquish the "development" of the State.
5.3 Attempts to Alert the World Bank
Regarding the problems described above, various attempts
were made to inform the World Bank, including:
1. The letter dated December 11, 1989, signed by Osmarino
Ambncio Rodrigues (Secretary of the National Council of Rubber
Tappers) and Ailton Krenak (National Coordinator of the Union of
Indigenous Nations), sent to Mr. Shahid Hussain (Vice President
for Latin America and the Caribbean) and Armeane Choksi (Director,
Brasil Department) of the World Bank (ANNEX 1.B), discussed the
problem of road construction by governmental agencies, without
regard for zoning legislation and environmental impact studies:
We know that the Machadinho-Tabajara road cuts across an area
designated as zone 04, for extractive activities, and was just
opened without the preparation of the legally required
environmental impact study (RIMA).
2. Again, it worth noting the January 9, 1990 correspondence
to Mr. E. Patrick Coady, World Bank Executive Director, in which
35 Brazilian and international NGOs (ANNEX 1.C) alerted that:
Currently, the project lacks specific measures and timelines that
oblige the Brazilian Government to guarantee the proposed
agro-ecological zones. For example, areas designated as
extractive reserves are currently the site of road construction.
3. In the document signed by 19 non-governmental
organizations from Rondtnia, sent on February 22, 1990 to Mr.
Shahid Hussain (Vice President for Latin America and the
Caribbean) of the World Bank (ANNEX 1.D), it was stated that:
"...Within the state extractive forest of Rio Preto-Jacunda, a
road linking the Machadinho and Tabajara settlement projects is
being opened that would facilitate the invasion of the area by
land speculators and logging companies..."
4. The document entitled "Open Letter" sent by the Forum of
NGOs of Rondtnia on 3/12/92 to the Executive Directors of the
World Bank (ANNEX 3.A), it was stated:
The Karipuna (Indians) are...being threatened by the construction
of BR-421, which would result in the reduction of their lands by
20 thousand hectares. Such a project, if executed, would bring
grave consequences, not only for the Karipuna, but also to the
isolated indigenous groups which inhabit this area, and
furthermore would threaten the boundaries of the Lages and
Uru-eu-wau-wau Indigenous Areas.
5. The problems cited above, involving investment and rural
credit programs, the energy sector and road construction were all
identified in the preliminary report of the Independent Evaluation
Committee (IEC) in February 1994.
In this regard, it is worth noting that the document
entitled "Record of the Meeting on Preliminary Impressions
Pertinent to the Implementation of PLANAFLORO", realized
on September 27, 1993, with the participation of members
the IEC and a World Bank representative states the
following:
"The Committee expressed its concerns with the publication of a
road map by DER-RO, in 1993, which showed planned roads that would
compromise the socio-economic and ecological zoning plan and
various conservation and environmental preservation units.
Although it is asserted that this map was published as a result of
the depletion of an earlier version, and that it was based on the
road plan from that period; the publication of this map is
alarming in that it could be interpreted as a lack of official
commitment from the Government of Rondtnia to the state zoning
plan, and in this manner, serve to encourage invasions and land
speculation. The World Bank representative confirmed that
shortly, the Government of Rondtnia should present a new road
plan, compatible with the recommendations of the state zoning
plan, to be published shortly thereafter. This map should include
the limits of the various zones, as well as those of conservation
units."
6. The problems described above, involving the state and
federal level investment programs, were also communicated to the
World Bank in the letter from the Forum of NGOs of Rondtnia which
was sent to the President and Executive Directors of the Bank on
6/15/94 (ANNEX 3.D).
5.4 Omissions of the World Bank
With regard to the problems involving the investment and
media programs defined in the official documents of
PLANAFLORO, we would like to point out the following
omissions of the World Bank:
1. According to item 05 of the matrix of institutional
reforms in PLANAFLORO ((IBRD 1992:52), joint evaluation with
government agencies should be carried out by the supervision
missions of the World Bank to review policies of economic
incentives and needs to make these compatible with the
recommendations of the state socio-economic and ecological zoning
plan.
However, the existence of the problems identified above,
with respect to rural credit, electrical energy and fiscal
incentives demonstrate that such joint evaluations have
not taken place in a satisfactory manner.
2. Considering the impact of the opening of new roads on the
dynamic of frontier expansion in Rondtnia, as well as the already
mentioned problems of the new roads' incompatibility with the
state zoning plan (see, for example, the letter from CNS and UNI,
dated October 1989, ANNEX 1.B), the World Bank should have
demanded the prior elaboration of a Master Road Plan (which would
have served as a guide for municipal governments) as a
pre-condition for disbursement of the road transport sector funds
of PLANAFLORO. Strangely, the World Bank adopted this policy for
the river transport sector (IBRD 1992:29, item 3.39), but not for
investments in road transportation (in spite of their infinitely
greater socio-environmental impacts).
It should be observed that the loan documents for
PLANAFLORO did not define a time schedule for conclusion
of the Master Road Plan for Rondtnia. The Aide Memoire
documents from the supervision missions of November 1992
(ANNEX 6.A) and September 1993 (ANNEX 6.B), also contain
no schedules for submission of the Master Road Plan.
Only in the Aide Memoire document from the World Bank/MIR
supervision mission of August 1994 (ANNEX 6.C) was there
mention of this subject:
the mission was informed that the documents related to the Master
Road Plan will be ready for the CNP (Normative Planning
Commission) by August 22, and will be sent for revision to MIR and
the Bank with the comments of the CNP by September 30, 1994.
MIR shall send to the Bank, by September 30, 1994, the investment
plans of the federal agencies in Rondtnia, principally of FNO,
SUDAM, SUFRAMA, ELETRONORTE and others relevant to the management
of PLANAFLORO.
Apparently, these commitments from the August 1994 aide
memoire have not yet been fulfilled. It should be noted
that in the Aide Memoire from the Bank's latest
supervision mission (March-April 1995), there are no
specific commitments related to the State Road Master
Plan, fiscal incentives policies or investments in the
energy sector, in contrast to the Aide Memoire of August,
1994.
3. In spite of the warnings made by NGOs and the Independent
Evaluation Committee (IEC), the Bank's internal report entitled
Brazil: Rondtnia and Mato Grosso Natural Resource Management
Projects (Loans 3444-BR and 3492-BR) Status of Implementation
(March 25, 1994) makes no comments about the problems identified
above, involving state and federal investment programs (ANNEX
7.B).
4. In the case of the media program anticipated in the loan
agreements for PLANAFLORO, there is no record of oversight by the
World Bank, in the Aide Memoires of November 1992, September 1993
and August 1994 and April 1995, in spite of the lack of
implementation of this activity by the Government of Rondtnia.
5.5 Adverse Impacts on Local Populations
The present and potential adverse impacts of World Bank
omissions, related to the lack of implementation of
reforms in investment and media programs, as defined in
PLANAFLORO's contractual agreements, are considerable.
The lack of oversight on the part of the Bank regarding
the implementation of a Master Road Plan for Rondtnia, to
serve as a reference for the private and public sectors,
has facilitated the opening of new roads without
consideration for the zoning plan and other related
environmental legislation. This fact has contributed to
both environmental damage and social conflicts involving
squatters, land speculators and traditional populations
(as in the example of highway BR-421).
The lack of Bank supervision with regard to investment and
fiscal incentive programs (FNO, SUFRAMA, etc.) has
facilitated the continuation of investment policies and
programs that contribute to environmental degradation,
concentration of wealth and social conflict, with negative
consequences for indigenous groups, rubber tappers, and
small farmers.
Furthermore, the absence of a media program to improve
public understanding and opinion about the state zoning
plan and PLANAFLORO has also resulted in adverse impacts
on local populations and the environment.
VI. Support to Indigenous Communities
6.1. Planned Actions in PLANAFLORO
According to the World Bank's Staff Appraisal Report, the
principal actions of the indigenous component of
PLANAFLORO should include: a) the demarcation of five
indigenous reserves with a total area of 500,000 hectares;
b) renewal of sections of the boundaries of another twelve
reserves; c) identification of isolated indigenous groups
and the possible demarcation of fourteen more indigenous
areas; d) improvements in health programs serving
indigenous populations, including use of mobile health
teams (equipes volantes de sazde - EVS); e) improvements
in the protection of indigenous areas, including support
of the Forest Police; and f) creation of a joint
FUNAI-Government of Rondtnia team to improve monitoring of
problems in indigenous communities.
According to Section 3.06 of the Loan Agreement, the
obligations of the Brazilian Government with regard to the
indigenous component of PLANAFLORO include: a)
registration with the "Property Department of the Union"
(Departamento de Patrimtnio da Unico - DPU) of the Pacaas
Novos, Roosevelt, Tubarco Latundj and Uru-eu-wau-wau
Amerindian reserves, as well as registration of these
reserves with local land registries in Rondtnia, and b)
the transfer, assignment or allocation, by December 31,
1992, of health staff necessary for the efficient carrying
out of the health care of the Indigenous Population under
part C.1 (d) of PLANAFLORO.
6.2 Evidence of Deviations/Omissions of the World Bank
Initially, the following aspects of the World Bank
Operational Directive on Indigenous Peoples (OD 4.20,
September 1991) should be noted:
- OD 4.20 emphasizes the importance of "informed
participation" by indigenous populations in projects
financed by the Bank. Among other measures, this
participation should include direct consultations to
identify local preferences, incorporation of indigenous
knowledge into project approaches, and appropriate early
use of specialists experienced with indigenous
populations.
- OD 4.20 states there should be mechanisms to ensure the
participation of indigenous populations in decision making
throughout the process of planning, implementation,
monitoring and evaluation of projects, including their
representative organizations;
- According to OD 4.20, in projects financed by the World
Bank, a culturally-appropriate "Indigenous People's
Development Plan" should be prepared. This plan must be
based on full consideration of the interests of indigenous
populations, incorporating local patterns of social
organization, religious beliefs and resource use.
- The components of a development plan can include
activities related to health and nutrition, productive
infrastructure, linguistic and cultural preservation,
entitlement to natural resources and education.
- The development plan should support production systems
that are well adapted to the needs and environment of
indigenous peoples.
- The indigenous people's development plan should avoid
creating or aggravating the dependency of indigenous
people on project entities. Planning should encourage
early handover of project management to local people. As
needed, the plan should include general education and
training in management skills for indigenous people from
the onset of the project.
- All possible measures should be taken to guarantee that
government agencies possess the institutional capacity to
execute the project in a satisfactory manner, especially
in terms of financial capability and adequacy of
experienced professional staff.
- The government's commitments toward implementing the
indigenous peoples development plan should be reflected in
the loan documents; legal provisions should provide Bank
staff with clear benchmarks that can monitored during
supervision missions.
With regard to the indigenous component of PLANAFLORO, we
point out the following examples of non-compliance with
the contractual agreements of the project and the World
Bank's operational directive on indigenous peoples (OD
4.20):
1. Within PLANAFLORO, an "indigenous peoples' development
plan" was not elaborated as stipulated in the Bank's operational
directive (OD 4.20). In the elaboration of PLANAFLORO, there were
many deficiencies in terms of guaranteeing direct consultations at
the level of indigenous villages and indigenous organizations,
aimed at securing their "informed participation".
2. The problem described above has manifested itself in the
absence in the original design of PLANAFLORO of specific
activities that should have been included in an "indigenous
peoples' development plan" including: economic alternatives,
productive infrastructure, cultural and linguistic preservation,
nutrition, education, etc.
3. The financial resources allocated to the sub-component
"Support for Indigenous Communities" were clearly underestimated
in the budget of PLANAFLORO. It is worth noting that the
indigenous peoples sub-component of PLANAFLORO was allocated
US$3.9 million (1.7% of the total project budget) while funds for
the road and river transport reach a total of US$56.9 million
(24.9% of the total budget of PLANAFLORO).
The funds allocated for the indigenous sub-component are
insufficient for the activities initially anticipated in
PLANAFLORO (demarcation, renewal of boundaries, indigenous
health, etc.). Not surprisingly, such limited funds do not
meet the other demands of local populations (education,
economic projects, etc.) It is estimated that the US$3.9
million of the indigenous sub-component of PLANAFLORO will
be entirely spent by the end of 1995, implying the
interruption of project activities in 1996.
4. Although the indigenous populations of Rondtnia, through
their organizations and communities, have on various occasions
demands (verbally, during Bank supervision missions) the
allocation of funds for funding a sub-project in indigenous
education, this was never concretized. On the contrary, this
subject has been neglected by the World Bank, as demonstrated by
the lack of references to indigenous education in the Staff
Appraisal Report and the Aide Memoires of various supervision
missions.
5. As a result of demands by indigenous and support
organizations, funds were negotiated in PLANAFLORO for the
financing of community projects in economic alternatives.
However, there has been a lack of rigorous criteria in the
elaboration and selection of these projects.
Initially, the few projects analyzed originated only from
villages where the commercialization of timber is taking
place, to the detriment of other communities. Em many
cases, projects were elaborated essentially by government
technicians (EMATER, FUNAI, SEDAM) without the
participation of communities and specialists in indigenous
cultures.
Another fact that is criticized by the Indians is that
projects in economic alternatives were not analyzed by the
Indigenous CNP (sectoral planning commission) of
PLANAFLORO. Rather, they were submitted directly to the
World Bank for analysis, disrespecting the structure for
discussions and approval for all projects implemented
through PLANAFLORO. It is worth noting that to date, no
funds have been released for these community projects,
which has both caused harm and contributed to a disbelief
with regard to PLANAFLORO among indigenous populations.
6. In contrast to the guidelines established in OD 4.20,
several critical activities in the indigenous sub-component of
PLANAFLORO are not listed as government commitments in the loan
documents; as in the case of the demarcation and protection of
indigenous areas.
7. There does not yet exist a strategy to guarantee the
participation of indigenous peoples and their representative
organizations in the monitoring of PLANAFLORO's activities. As
shown in Chapter VII, this fact is indicative of a larger problem
within the monitoring system of PLANAFLORO.
8. In the preparation and initial execution of PLANAFLORO,
the World Bank did not adequately follow either the guidelines set
out in OD 4.20, with regard to ensuring institutional capacity of
executing agencies, especially FUNAI. This problem is also
relevant to the Bank's operational directive on Project
Supervision (OD 13.05, see Chapter VII). Evidence of this problem
includes:
a) the failure to demarcate five indigenous areas
considered priorities (Sagarana, Rio Guapori, Rio Mequens,
Karipuna and Massaco) in the first year of project
execution;
b) suspension of the demarcation of the Rio Mequens
Indigenous Area, as a result of delays in allocating funds
resources to the Army, as well as political pressures;
c) the failure to resolve land tenure problems in the
Uru-eu-wau-wau Indigenous Area, which has impeded its
official registration in the DPU, as anticipated in the
loan agreements for PLANAFLORO;
d) the delays of more than two years in the contracting of
specialized personnel necessary to implement the
indigenous health component of PLANAFLORO (especially the
mobile health teams). Moreover, the contracting of
personnel through the UNDP does not represent a long-term
solution to this problem.3
In December 1994, FUNAI requested agreement from the World
Bank on authorizing the administration of funds from the
indigenous sub-component directly between the Ministry of
Planning and Budget (MPO), Bank of Brazil and FUNAI, while
maintain recognition of decision-making bodies at the
state level (CNPs, State Deliberative Council). The
objective would be to reduce bureaucratic procedures that
have caused delays in the release of funds to FUNAI,
causing enormous problems for the implementation of
PLANAFLORO. FUNAI is still awaiting a response from the
World Bank on this subject.
9. In 1991, through "Operation Flora Viva", various state and
federal agencies, together with NGOs, carried out enforcement
activities in various conservation units, including indigenous
areas (such as the Mequens and Uru-eu-wau-wau reserves).
However, there does not yet exist a coherent strategy for
guaranteeing the protection and enforcement of Indigenous
Areas and other conservation units (see also Chapter IV).
In PLANAFLORO, one observes major expenses with sporadic
operations that are poorly planned and lack continuity,
with little practical impact. Meanwhile, there persists a
lack of institutional articulation between government
agencies (IBAMA, SEDAM, FUNAI, PMF), along with policies
of environmental licensing that encourage illegal acts of
resource exploitation within indigenous areas (see chapter
IV).
6.3 Attempts to Alert the World Bank
In relation to the problems mentioned above, the following
attempts to alert the World Bank should be noted:
1. In a letter dated December 11, 1989, signed by Osmarino
Ambncio Rodrigues (Secretary of the National Council of Rubber
Tappers) and Ailton Krenak (National Coordinator of the Union of
Indigenous Nations), sent to Mr. Shahid Hussain (Vice President
for Latin America and the Caribbean) and Armeane Choksi (Director,
Brasil Department) of the World Bank (ANNEX 1.B); the following
demands were made:
...that the Bank not negotiate this project with the government
while local communities and their organizations (the National
Council of Rubber Tappers, the Union of Indigenous Nations, local
unions, associations of small producers) are not informed of the
content of the project and its purposes, given that these entities
have yet had any participation in the project;
...that a date be set, with an deadline to convene all of these
organizations to carry out a discussion of the project, where the
groups can propose changes and additions to the project;
...that the indigenous areas that were, during the POLONOROESTE
project, to be demarcated and regularized and that were not, and
new areas for more remote groups of Rondtnia, all be regularized
before the liberation of any funds.
6.4 Adverse Impacts on Local Populations
In this chapter, we argue that the World Bank is
co-responsible for various problems in the design and
initial implementation of the indigenous sub-component of
PLANAFLORO, especially with regard to: a) deficiencies in
the planning of the sub-component, in terms of the
"informed participation" of indigenous peoples,
elaboration of an "indigenous peoples' development plan"
(as stated in OD 4.20) and in the adequate dimensioning of
financial resources, b) insufficient analysis of problems
and necessities related to the institutional capacity of
executing agencies and the administration of financial
resources, and c) insufficient attention to the problems
of environmental licensing and enforcement, which have
compromised the activities of PLANAFLORO (see Chapter
IV).
The facts described in this chapter, in which we have
noted omissions on the part of the World Bank, have
resulted in serious damage to indigenous communities in
Rondtnia. The obstacles to the implementation of planned
activities in demarcation, border renewal, and protection
of indigenous areas have facilitated invasions by loggers,
miners, land speculators and unscrupulous entrepreneurs,
causing serious damage to the environment and to
indigenous peoples. In this regard, we point out the
invasions associated with delays in the demarcation of the
AI Mequens, the creation and demarcation of the AI
Karipuna, and in the registry in the DPU of the AI
Uru-eu-wau-wau.
With regard to issues of health, education and economic
alternatives in the indigenous sub-component of
PLANAFLORO, the problems described above have led to harm
in relation to the quality of life of indigenous peoples
in Rondtnia. For example, the lack of medical attention
has already had repercussions in the Uru-eu-wau-wau
reserve, where three disease-related deaths have already
been recorded in 1995.
VII. Project Administration
The component for project administration in PLANAFLORO
anticipated such activities as the structuring a project
coordination unit consultancies and technical assistance,
monitoring and evaluation. With respect to this component
of PLANAFLORO, we would like to point out the following
examples of non-compliance and omissions on the part of
the World Bank:
7.1 Popular Participation
According to the operational directive entitled "NGO
Involvement in World Bank-Supported Activities" (OD 14.70,
August 1989), the Bank recognizes the importance of NGO
participation in strategic areas such as analysis of
public policies and development problems, identification
of projects, conception and elaboration of projects,
implementation of projects and finally, monitoring and
evaluation activities.
In item 11, OD 14.70 further states that:
Staff should be responsive, and encourage governments to be
responsive, to NGOs that request information or raise questions
about Bank-supported activities.
In contrast to this operational directive, the process of
elaboration of PLANAFLORO by government staff and World
Bank consultants, was characterized by a lack of effective
participation of organized civil society, especially the
representatives of the project beneficiaries (rubber
tappers, riverine populations, small-farmers, indigenous
communities).
There is a long history of demands made by NGOs and social
movements about the necessity of guaranteeing effective
popular participation in PLANAFLORO. This history was
registered in various documents sent to the World Bank,
including :a) the letter by Chico Mendes to Mr. Barber
Conable, President of the World Bank, on October 13, 1988
(ANNEX 1.A); b) the letter from the National Council of
Rubber Tappers and the Union of Indigenous Nations to the
World Bank, dated December 11, 1989 (ANNEX 1.B); c) the
letter signed by 35 Brazilian and international NGOs, sent
to Mr. E. Patrick Coady, an Executive Director of the
World Bank on January 9, 1990 (ANNEX 1.C); d) the letter
signed by 19 NGOs from Rondtnia, sent on February 22, 1990
to Mr. Shahid Hussain (Vice President for Latin America
and the Caribbean) of the World Bank (ANNEX 1.D).
Initially, rather than accepting a dialogue with NGOs
about alternatives for popular participation in
PLANAFLORO, the World Bank and the Government of Rondtnia
were defensive, trying to discredit such criticisms (see,
for example, ANNEX 1.E).
It was only possible to come to an agreement regarding the
official participation of NGOs in PLANAFLORO on the
occasion of the signing of a "Protocol of Understanding"
between the Government of Rondtnia and NGOs in June 1991
(ANNEX 2). In this agreement, spaces for the
institutional participation of NGOs were guaranteed in the
activities of project planning, monitoring and evaluation,
as well as on the Deliberative Council--the highest-level
decision making body at the state level. Furthermore, the
Government of Rondtnia committed itself to taking a series
of emergency measures aimed at protecting the environment
and territories occupied by traditional populations.
As publicly denounced by the Forum, the vast majority of
commitments assumed by the Government of Rondtnia in the
"Protocol of Understanding" were never fulfilled,
including the items referring to popular participation.
This situation was communicated to the World Bank through
various correspondences, such as: a) the "Open Letter"
from the Forum of NGOs of Rondtnia, sent on 3/12/92 to the
Executive Directors of the World Bank (ANNEX 3.A); b) the
memorandum elaborated by the Forum and submitted to Mr.
Luis Coirolo of the World Bank, on 5/12/92 (ANNEX 3.B);
and c) the letter from the Forum to the President and
Executive Directors of the World Bank on 6/15/94 (ANNEX
3.D).
It was only in August 1994 that a supervision mission of
the World Bank took more concrete measures to promote the
re-evaluation of the administrative model of PLANAFLORO,
including the aspects of popular participation. Even so,
the great majority of the problems identified in the
Forum's letter from June 1994 have not yet been resolved.
It should be noted that in item 17 of OD 14.70, the Bank
asserts that:
"When the participation of NGOs is probable, the Executive Project
Brief should indicate their role; and the Project Brief and staff
appraisal report should, if appropriate, mention the relevant NGOs
and their relation to the project, as well as describe the
agreements reached with the Government and NGOs ,with respect to
NGO participation in projects that affect large groups of
low-income populations"
In this regard, it is strange to note that the "Protocol
of Understanding" of June 1991 was not mentioned in the
Staff Appraisal Report for PLANAFLORO (issued in February
1992). This documents only mentions NGO participation
with regard to the State Deliberative Council (p. 31) and
the Independent Evaluation Committee (p. 43). It should
be noted that in the memorandum to Mr. Luis Coirolo of the
World Bank, dated May 12, 1992 (ANNEX 3.B), the Forum
argued that:
It is necessary that the agreements included in the Protocol of
Understanding be included in the official documents of PLANAFLORO,
which are soon to be signed in Washington.
We believe that the Government of Rondtnia's failure to
comply with the commitments made to the NGOs can be
explained, at least in part, by the lack of reference to
the "Protocol of Understanding" of June 1991 in the
official documents of PLANAFLORO.
7.2 Supervision
With respect to the supervision of PLANAFLORO by the World
Bank, given the Bank's operational directive on this
subject (OD 13.05), the following points should be noted:
1. As evidenced by the facts presented in this document, we
assert that the Bank failed to adequately implement the directives
of OD 13.05, in the areas of:
-ensuring that the borrower implements the project with due
diligence to achieve the agreed development objectives and in
conformity with the loan agreement;
-identifying problems promptly as they arise during implementation
and helping the borrower resolve them;
-monitoring compliance with the legal agreements and, where
conditions are not being fulfilled, determining the causes and the
best means for remedying the situation.
2. According to OD 13.05, the Bank should not initiate loan
disbursements until all conditions of effectiveness are fulfilled.
In this regard, the declaration of effectiveness of loan BR-3444
in January 1993, prior to the signing of the agreement between
INCRA and the Government of Rondtnia, as stipulated in Section
2.12 (a) of the Project Agreement and Section 6.01 (b) of the Loan
Agreement, constituted a violation of OD 13.05.
3. Until recently, the World Bank supervision missions have
maintained very sporadic contact with non-governmental
organizations in Rondtnia. During supervision missions, Bank
staff have generally dedicated the majority of their time to
negotiations with executing agencies; in some cases undermining
the ongoing discussions in the CNPs (Normative Program
Commissions) as well as the decision-making power of the State
Deliberative Council.
4. As described above, it should be emphasized that the
problems related to the failure to implement the Institutional
Reform Program and the incompatibility of public policies with the
directives of the state zoning legislation and PLANAFLORO have not
received due attention during the Bank's supervision missions.
5. Another particularly grave aspect of the Bank's behavior
in the supervision of PLANAFLORO relates to the flaws in the
elaboration of internal reports ("Reporting"), a duty under the
principal responsibility of the Task Manager.
Considering the directives of OD 13.05, which discuss the
methods and criteria for periodic preparation and updating
of Form 590 (the principal instrument of information for
the superior levels of the Bank), it can be concluded that
an improper act was committed when the internal Bank
report entitled Brazil: Rondtnia and Mato Grosso Natural
Resource Management Projects (Loans 3444-BR and 3492-BR)
Status of Implementation (3/25/94) conceded a rating of
"2" to the execution of PLANAFLORO. Consequently, this
report contributed to disguising from the Executive
Directors problems identified the implementation of
PLANAFLORO, such as those enumerated by the Independent
Evaluation Committee.
7.3 Monitoring
According to the World Bank operational directive on
Project Monitoring and Evaluation (OD 10.70, September
1989), monitoring activities should receive special
attention in projects such as PLANAFLORO that are
innovative or complex from the institutional point of
view. Furthermore, OD 10.70 determines that these
activities require regular contact with the beneficiary
population and that, in cases where there is an unexpected
reaction on the part of the beneficiaries, those
responsible for the project should conduct a diagnostic
study to identify necessary corrective actions.
According to Section 2.05 (b) of the Project Agreement,
"the Government of Rondtnia must, by no later than
December 31, 1992, complete the revision and
simplification of all project performance indicators and
all operating procedures of the Monitoring and Evaluation
Unit, and make the new system function in a manner which
is satisfactory to the Bank".
The problems with PLANAFLORO's monitoring system were
communicated to the World Bank in a series of
correspondences from non-governmental organizations in
Rondtnia. For example, in its "Open Letter" dated
3/12/92, sent to the Executive Directors of the World Bank
(ANNEX 3.A), the Forum informed the Bank that:
Mechanisms for the participation of NGOs in the monitoring and
evaluation of PLANAFLORO have not yet been defined.
In the letter sent by the Forum to the World Bank in June
1994 (ANNEX 3.D), the monitoring system adopted in
PLANAFLORO was again questioned:
In the current administrative model of PLANAFLORO, there does not
exist an effective monitoring strategy to accompany the execution
of PLANAFLORO.
Initially, it should be observed that the objectives and goals
which make up the great majority of the POAs are extremely vague,
which makes the definition of monitoring indicators difficult.
The monitoring reports elaborated by the executing agencies and
Executive Secretariat of PLANAFLORO do not present sufficient
information, from the quantitative and qualitative points of view,
to allow the project's execution to be accompanied closely. The
trimestral monitoring reports are organized by the executing
agency, without any systematic reference to each sub-component and
executive project. In the current monitoring system, there is no
way to verify up to what point the execution of the projects is
compatible with the actions outlined in the POAs and in the
analyses written by the CNPs (and later approved by the
Deliberative Council).
It should be noted that to date, no strategy has been defined for
the participation of NGOs, especially those organizations
representing project beneficiaries, in the monitoring of
PLANAFLORO.
Considering these statements, it can be affirmed that
various guidelines of OD 10.70 (Project Monitoring and
Evaluation) and of OD 14.70 (Involvement of NGOs), in
addition to the contractual conditions of PLANAFLORO, were
not complied with during the execution of the project.
Only after being pressured did the World Bank, in August
1994, take more concrete measures to resolve this impasse.
Even so, the problems related to the monitoring system of
PLANAFLORO have not yet been dealt with adequately.
7.4 Independent Evaluation Committee
According to Section 2.08 of the Project Agreement, the
Government of Rondtnia must convene annually an
Independent Evaluation Committee (IEC), including the
participation of NGO representatives, to analyze the
implementation of the environmental policy and regulatory
reforms undertaken in connection with PLANAFLORO, the
compatibility of investment programs with the state's
socio-economic and ecological zoning, and the performance
achieved in each of the various project components. By
June 30 of each year, the Government of Rondtnia should
present the findings of the Independent Evaluation
Committee to the Bank for its review and comment.
The first "Independent Evaluation Committee" was convened
in September 1993, with the participation of four
representatives of government institutions and four
non-governmental organizations. In February 1994, the IEC
presented a preliminary evaluation report. On March 16,
1994, upon the solicitation of the World Bank, a final
version of the Executive Summary of the evaluation report
was submitted to the Bank.
However, until the present date (more than two years after
the initiation of loan effectiveness) the final evaluation
report of the IEC has not been officially submitted. This
fact resulted from a blocking of logistical support and
financial resources by the Executive Secretariat of
PLANAFLORO during 1994, as well as political pressures to
"soften" the contents of the IEC report.
During a considerable period, there was no oversight by
the World Bank with respect to submission of the final
report of the IEC. In other words, the World Bank did not
require compliance of the Government of Rondtnia with
Section 2.08 of the Project Agreement.
As previously described, in the internal Bank report
entitled Brazil: Rondtnia and Mato Grosso Natural
Resource Management Projects (Loans 3444-BR and 3492-BR)
Status of Implementation, signed by Mr. Shahid-Javed
Burki, Vice President of Operations for Latin America and
the Caribbean (March 25, 1994), one observes an attempt to
"soften" the contents of the IEC report, to the point of
provoking distortions in its contents. Moreover, the
Bank's report affirms that:
The report (of the IEC) will be discussed with the Government, and
will be the subject of various seminars and workshops with state
authorities in the next few months.
Unfortunately, no such seminars and workshops were ever
held, due to a lack of interest of the part of the
Government of Rondtnia. Nor was the preliminary report of
the IEC discussed in any decision-making forum of
PLANAFLORO (CNPs, Deliberative Council, etc.). These
facts and the impediments which prevented the submission
of the IEC's final report (which amounted to
non-compliance with Section 2.08 of the Project Agreement)
were not communicated to the Executive Directors by the
operational staff of the Bank.
In conclusion, the omissions of the World Bank with regard
to enforcement of Section 2.08 of the Project Agreement
have contributed to obstruct the process of project
evaluation in PLANAFLORO (one of the main mechanisms of
"quality control" in the project). Clearly, these facts
contrast with the Bank's operational directive on Project
Monitoring and Evaluation (OD 10.70).
7.5 Procurement
In the process of the prequalification of firms for the
procurement of studies associated with the second
approximation of the socio-economic and ecological zoning
plan, one may observe violations of the procedures
outlined in OD 13.05 (Project Supervision) and OD 11.00
(Procurement).4
We refer initially to an internal World Bank Memorandum
from March 28, 1994 (ANNEX 7.C), regarding a meeting held
in Washington, D.C. on March 15 of that year. In a visit
to the World Bank, representatives of the Government of
Rondtnia were actively striving to obtain a "no objection"
from the Bank in the prequalification of firms for the
procurement of studies for the second approximation of the
state zoning plan.
In the cited memorandum, two World Bank staff members
related to their superiors their knowledge of
irregularities committed by the Government of Rondtnia in
the prequalification of firms for the said procurement,
which made this process incompatible with the internal
directives of the Bank. The memorandum recorded that this
problem had been confirmed by a financial specialist of
the Bank. In short, it demonstrated evidence that the
Government of Rondtnia had used questionable methods to
disqualify various firms from the competition, while
favoring a certain firm with strong political support.
According to the World Bank's directives, borrowers should
be informed of Bank decisions regarding procurement
documents within one week after these documents are
received by the Bank (and in complex cases, within ten
working days).
Furthermore, according to paragraph 82 of OD 11.00,
when the Bank determines (inter alia)...that judgments exercised
in the process are not reasonable and fair, the Bank should point
this out to the Borrower and advise that, if not rectified, the
Bank may declare misprocurement. 5
Rather than responding punctually regarding the problems
identified in the prequalification phase, the Bank spent
several months without issuing an official response to the
Government of Rondtnia. Apparently, such "timidness" of
the Bank was motivated by the possibility of
"embarrassments" which news regarding irregularities in
the procurement of the state zoning studies could cause
the Government of Rondtnia during an election year.
This situation was confirmed in another internal
memorandum dated June 6, 1994, sent by the local
representative of the World Bank to Washington (ANNEX
7.D). In this memorandum, it is recorded that the
Governor of Rondtnia had personally telephoned the local
representative of the Bank, complaining about the delays
in procurement for the zoning plan and consequently, in
the disbursement of funds for the infrastructure component
of PLANAFLORO (as a result of the "pari-passu" policy of
the Bank). In this phone call, the Governor of Rondtnia
threatened to cancel the project if this problem was not
"resolved" immediately.
Rather than follow its own internal directives, with an
aim at correct errors and "improve procurement procedures
and measures for greater efficiency and effectiveness of
implementation" (OD 11.00), the World Bank initially
waited several months to reply to the Government of
Rondtnia. Afterwards, the Bank accepted a "gentlemen's
agreement" which readmitted companies that had been
disqualified, without the formal carrying out of a new
judgment by the Government of Rondtnia.6
7.6 Independent Auditing
According to Section 3.01 (a) of the Project Agreement,
the Government of Rondtnia should present to the Bank at
the end of each fiscal year the results of an independent
audit of the project expenses. To date, such a financial
audit of PLANAFLORO has not been carried out.
7.7 Use of Consultants
In the preparatory phase (1993-95) of the Technical
Cooperation Project in PLANAFLORO, carried out in
conjunction with UNDP, we have observed a series of
irregularities in the contracting of consultants (many of
which are public employees already involved with the
project), without the due carrying out of a competitive
selection process. The collusion of the World Bank in this
process constitutes a violation of its operational
directive on the use of consultants (OD 11.10), where
rigorous measures are defined to guarantee the maintenance
of technical criteria in the selection of individuals and
firms for consulting services.
7.8 Suspension of Disbursements
The conditions outlined in the General Conditions of the
World Bank (item 6.02), within OD 13.40, and in article V
of the PLANAFLORO Loan Agreement define the cases and
procedures in which the Bank can and/or should activate
mechanisms related to the suspension of disbursements.
The Loan Agreement of PLANAFLORO includes a list of
possible situations in which suspension of disbursements
would be justified, in addition to those established by
the General Conditions. These situations include: 1) if
the Government of Rondtnia shall have failed to perform
any of its obligations under the Project Agreement, 2) if
the state zoning legislation shall have been amended,
suspended or modified in its essence and 3) if the
Borrower (Brazilian Government) or the Government of
Rondtnia shall have amended the Reform Program or taken
any other action or failed to take any action so as to
affect, materially and adversely, their ability to carry
out the project.
Considering the facts described in this document and the
directives of OD 13.40 (Suspension of Disbursements), the
World Bank should have activated the mechanisms for the
suspension of disbursements for PLANAFLORO, using the
following list of successive actions:
a) If the Bank determined that failure of compliance with
the loan agreements was motivated by temporary problems
and the borrower agreed to resolve them rapidly, an
informal suspension could be used, after a written warning
to the Borrower. Such a suspension would last for a
period of sixty days, affecting only those components
identified by the Bank as relevant. During this time
period, the Borrower could take measures necessary to
guarantee the continuity of the project.
b) If the problem persisted, the Bank could transform the
informal suspension into a formal suspension, without
affecting the validity of the contractual conditions of
the loan. In any event, the components not subject to the
suspension would continue to receive funding.
c) If attempts failed to ensure compliance in the
previously cited stages, the Bank could implement a
general suspension of loan disbursements. Even in this
case, the contractual agreements of the project would
continue to apply.
We conclude that the World Bank, contrary to its own
operational directives, failed to use one of the principal
legal instruments at its disposal to ensure compliance
with the contractual agreements of PLANAFLORO.
7.9 Adverse Impacts on Local Populations
The problems described above, involving omissions of the
World Bank in the compliance with PLANAFLORO's contractual
agreements and the Bank's own operational directives, have
caused a series of adverse effects for the beneficiaries
of PLANAFLORO.
The failures of the Bank identified in this chapter,
related to the project's monitoring, evaluation and
supervision activities, impeded the timely undertaking of
corrective measures which could have minimized the social
conflicts and problems of environmental degradation that
were aggravated over the course of time.
With regard to the deviations in procurement procedures
pointed out above, it should be remembered that the
studies for the second approximation of the state's
socio-economic and ecological zoning constitute a
fundamental aspect of PLANAFLORO, including as a means to
ensure implementation of other project components. In
this sense, it can be argued that delays in the detailing
of the zoning plan have contributed to the aggravation of
social conflicts and environmental damage.
VIII. Conclusions
Considering the facts presented in this document, we
request that the INSPECTION PANEL proceed with an
investigation of the errors committed by the World Bank in
the implementation of PLANAFLORO (as well as other errors
eventually identified), in light of the rules applicable
in this procedure of inspection, independently of their
explicit citation in the course of this text.
We believe that it is essential to investigate the motives
that led the World Bank, during a significant period in
the preparation and initial execution of PLANAFLORO, to
surprising omissions with respect to necessities for
compliance with the project's contractual agreements and
the implementation of the Bank's own operational
directives. In this regard, we believe that it is
especially relevant to investigate the omissions of the
World Bank in relation to the following issues, as
described in the present document:
a) the lack of enforcement by the World Bank with respect
to implementation of reforms in public policies and the
formalization of agreements between executing agencies, as
anticipated in the official documents for PLANAFLORO;
particularly with regard to land tenure policy,
environmental licensing, institutionalization of the
socio-economic and environmental zoning, state
conservation units, and investment and fiscal incentive
policies. In this sense, in addition to neglecting the
contractual agreements of PLANAFLORO, the World Bank has
not adequately implemented its operational directives in
Forestry (OP 4.36) and Wildlands (OP 11.02);
b) the lack of an adequate analysis, on the part of the
World Bank, of the enormous deficiencies in technical
capacity of the executing agencies of PLANAFLORO (such as
SEDAM, ITERON, FUNAI and IBAMA), as well as corrective
measures to minimize these problems. In addition, despite
the World Bank's recent statements concerning the
importance of "ownership", we argue that the Bank failed
to conduct an adequate evaluation of the political
commitment of government agencies to the objectives and
goals of PLANAFLORO. Such problems have represented the
most important obstacle to project implementation. Such
practices contrast with various operational directives of
the World Bank, including: Indigenous Peoples (OD 4.20),
Forestry (OP 4.36), and Investment Lending (BP 10.00,
Annex D).
c) in the activities of supervision, the lack of
enforcement by the World Bank in ensuring implementation
by government agencies of various actions outlined in the
staff appraisal report, loan agreements, and Aide Memoires
from previous supervision missions. Such practices
contrast with the Bank's operational directives on project
supervision (OD 13.05) and in some cases, suspension of
disbursements (OD 13.40).
d) the lack of orientation and enforcement, on the part of
the World Bank, of activities in monitoring and evaluation
that were anticipated in the official documents of
PLANAFLORO, in contrast to the operational directive on
project monitoring and evaluation (OD 10.70);
e) the difficulties in guaranteeing a flux of up-to-date
and accurate information on project progress in PLANAFLORO
between operational staff and the Executive Directors of
the World Bank, in contrast to the operational directive
on project supervision (OD 13.05) and other internal
procedures, including the recommendations of the
"Wapenhans Report";
f) the omissions of the World Bank in the design and
implementation of the component "Support for Indigenous
Communities" of PLANAFLORO in relation to the Bank's
operational directive on indigenous peoples (OD 4.20) and
the official project documents.
g) the lack of implementation of World Bank procedures in
the activities of procurement (OD 11.00) and use of
consultants (OD 11.10), as well as the carrying out of an
independent audit of annual project expenses, as defined
in the contractual agreements of PLANAFLORO.
h) the omissions of the World Bank, with regard to
implementation of measures to ensure the effective
participation of civil society in PLANAFLORO, as defined
in the operational directive on involvement of NGOs in
Bank-supported activities (OD 14.70).
In the past several years, the organizations that today
compose the Forum of NGOs and Social Movements of
Rondtnia, as well as other NGOs and leaders of social
movements, have made various attempts to alert the World
Bank about the problems described in this document.
However, almost all of the correspondences sent by NGOs
from Rondtnia never received a response from the World
Bank (as in the case of the documents included as annexes
1.A, 1.B, 1.C, 3.A, 3.C, and all of the documents in
annexes 04 and 05).7
Unfortunately, the World Bank only assumed a firmer stance
when pressured by public opinion, after having received a
letter from the Forum dated June 15, 1994, addressed to
the President and Executive Directors of the Bank (ANNEX
3.D). On this occasion (August 1994), the Bank sent a
supervision mission that, nonetheless, did not result in
adequate measures being taken to address the problems
identified in the present document.
We conclude that in the preparation and initial execution
of PLANAFLORO, the interests of ensuring the approval of
the loan and the liberation of financial resources (both
in governmental spheres and in the World Bank itself)
prevailed over the necessity of guaranteeing the effective
implementation of the project, in accordance with the
contractual agreements and operational directives of the
Bank.
We hope that this Panel and the Executive Directors of the
World Bank will recognize the necessity of analyzing the
motives that led to serious omissions of the Bank and
consequent damage to local populations and the
environment, as well as to Brazilian society in general,
and will determine an investigation as soon as possible,
instead of postponing such an exercise for an "ex-post"
project evaluation. Such an investigation would greatly
contribute to the resolution of ongoing problems in the
execution of PLANAFLORO, and more importantly, to efforts
at avoiding the repetition of similar problems in other
projects supported by the Bank.
Finally, we remain at the disposal of this Panel to
provide any additional information that may become
necessary. We kindly request to informed of
communications on this subject between the Inspection
Panel, Executive Directors and Operational Staff of the
World Bank, with copies of all correspondences sent to the
office of the Forum of NGOs and Social Movements in
Rondtnia.
Sincerely,
(SIGNATURES ATTACHED)
Address for Contact:
Fsrum das ONGs e Movimentos Sociais de Rondtnia Rua Carlos Gomes
No. 1001 - Centro Porto Velho, Rondtnia, BRASIL
CEP 78.900-500
tel/fax: (55-69) 223-1116 e-mail: forumro@ax.apc.org
IX. List of Annexes
ANNEX 01: Correspondence between NGOs and the World Bank Prior to
the Approval of the PLANAFLORO Loan (1988-1990)
a) Letter from Francisco "Chico" Mendes of the National
Council of Rubber Tappers (CNS) sent to Mr. Barber
Conable, President of the World Bank (October 13, 1988);
b) Letter dated December 11, 1989, from Osmarino Ambncio
Rodrigues (CNS) and Ailton Krenak (Union of Indigenous
Nations -- UNI) addressed to Mr. Shahid Hussain (Vice
President for Latin America and the Caribbean) and Armeane
Choksi (Director, Brasil Department) of the World Bank;
c) Letter dated January 9, 1990, signed by 35 Brazilian
and international non-governmental organizations, sent to
Mr. E. Patrick Coady, an Executive Director of the World
Bank;
d) Document signed by 19 non-governmental organizations
from Rondtnia to Mr. Shahid Hussain (Vice President for
Latin America and the Caribbean) of the World Bank, with
cover letter from the Environmental Defense Fund (EDF),
dated February 22, 1990;
e) Letter from Mr. Shahid Hussain (Vice President for
Latin America and the Caribbean) of the World Bank to Mr.
Frank E. Loy, President of the Board of Directors of the
Environmental Defense Fund (EDF), dated March 5, 1990;
f) Letter from Raimundo Ramos Leitco, President of the
Association of Soldiers of Rubber and Rubber Tappers of
Ariquemes, to Mr. Barber Conable, President of the World
Bank, dated April 25, 1990.
ANNEX 02: Protocol of Understanding signed by the Government of
Rondtnia and NGOs on June 20, 1991
ANNEX 03: Correspondence Sent by the NGO Forum of Rondtnia to the
World Bank (1992-1994)
a) "Open Letter" to the Board of Directors of the World
Bank, dated March 12, 1992;
b) Memorandum to Mr. Luis Coirolo of the World Bank,
dated May 12, 1992;
c) Letter to the Central Forestry Unit of the World Bank,
dated May 16, 1994;
d) Letter to the President and Executive Directors of the
World Bank, dated June 15, 1994;
ANNEX 04: Correspondence sent by local NGOs to the World Bank
a) Official Letter (Ofmcio) no.19/93 from ECOPORI, dated
March 9, 1993, addressed to the Governor of Rondtnia,
SEDAM, ITERON and Forest Police;
b) Letter from the Rondtnia Rubber Tappers Organization
(OSR) and ECOPORI, dated April 26, 1993, addressed to the
Secretariat for Environmental Development of Rondtnia
(SEDAM-RO);
c) Official Letter no. 042/93 from ECOPORI, dated April
27, 1993, addressed to the President of INCRA;
d) Official Letter no. 048/93 from ECOPORI to Francesco
Vita, representative of the local office of the World Bank
in Cuiaba (Mato Grosso State), dated May 04, 1993;
e) Letter from OSR and ECOPORI, dated June 22, 1993,
addressed to various state and federal agencies;
f) Letter from OSR dated June 23, 1993, sent to SEDAM,
ITERON, INCRA, IBAMA, the Forest Platoon and the Executive
Secretariat of PLANAFLORO;
g) Official Letter no. 122/93, from ECOPORI, dated
November 22, 1993, addressed to the State Secretariat for
Environmental Development (SEDAM);
h) Official Letter no. 41/94 from ECOPORI, dated April 7,
1994, addressed to SEDAM, PMF and IBAMA;
i) Official Letter no. 052/94 from ECOPORI, dated May 14,
1994, addressed to the President of IBAMA;
j) Official Letter no. 055/94 from ECOPORI, dated May 23,
1994, addressed to SEDAM, PMF, ITERON, IBAMA and INCRA;
k) Letter of CUNPIR (Coordination of the Union on
Indigenous Peoples and Nations of Rondonia, Northern Mato
Grosso and Southern Amazonas) to the UN Human Rights
Commission, dated May 10, 1995
ANNEX 05: Correspondence from the Forum of NGOs of Rondtnia
regarding INCRA's Land Tenure Policy (1992-1993)
a) Letter to the President of the Republic (May 28,
1992);
b) Letter to the President of INCRA, (August 14, 1992):
c) Letter to the President of INCRA, (September 8, 1992)
d) Letter to the President of INCRA, (April 15, 1993);
e) Letter to the President of the World Bank (including
English translation) sending a copy of the April 15 letter
to the President of INCRA (Annex 5.E)
ANNEX 06: Aide Memoires from World Bank Supervision Missions
(1992-1995)
a) Aide Memoire from the World Bank's November 1992
supervision mission for PLANAFLORO;
b) Aide Memoire from the World Bank's September 1993
supervision mission for PLANAFLORO;
c) Aide Memoire from the World Bank's August 1994
supervision mission for PLANAFLORO (IBRD/MIR/Government of
Rondtnia);
d) Aide Memoire from the World Bank August 1994
supervision mission (Government of Rondtnia/Forum of NGOs
of Rondtnia);
e) Aide Memoire from the World Bank April 1995
supervision mission;
ANNEX 07: World Bank Documents
a) Matrix of Environmental Policies, Measures and
Actions, Staff Appraisal Report (Report 8073-BR), World
Bank, February 27, 1992 (Annex 1, Table 1.1, pp. 51-52);
b) Brazil: Rondtnia and Mato Grosso Natural Resource
Management Projects (Loans 3444-BR and 3492-BR) Status of
Implementation, (internal World Bank report), Mr.
Shahid-Javed Burki, Vice President of Operations for Latin
America and the Caribbean, March 25, 1994;
c) Office Memorandum, LA1AE, March 28, 1994;
d) Office Memorandum, LA1CB, June 6, 1994;
1 It should be noted that the Rio Abunc State Forest was included
in Section 2.10 of the Project Agreement as a conservation unit to
be maintained by the Government of Rondonia throughout the
implementation of PLANAFLORO.
2 Programa Decenal de Geragco 1994/2003, Sistema Isolados das
Capitais da Regico Norte, Final Report, Cycle 1992/1993, Rio de
Janeiro, ELETROBRAS, December 1993.
3 It should be mentioned that in the planning of indigenous
health activities in PLANAFLORO, it was anticipated that health
services would be focused mainly at the village-level. Other
measures would include the creation of mobile health teams and the
training of Indians as health monitors. Unfortunately, only
activities related to the mobile health teams have been carried
out, and in a precarious fashion.
4 We point out that the arrangements of paragraph 14(b) of
Resolution 93-10 of the Executive Directors of the World Bank,
establishing the Inspection Panel, do not apply to the issues
mentioned here for the following reasons:
1) the complaint regarding violations is not about a
procurement decision made by Borrowers of the Bank, but
about the failure to supervise the procurement procedures
and implement other Bank rules;
2) the complaint is not being presented by suppliers of
goods or services, nor by losing competitors involved in
the procurement of such goods or services.
5 According to the World Bank's internal directives (OD 13.05 and
OD 11.00) the principal responsibility for the monitoring of
procurement procedures lies with the Task Manager, who informs
about decisions (including those about misprocurement) to superior
administrative levels of the Bank.
We emphasize that OD 13.05 establishes that "special
efforts shall be made during supervision to a) inform
country representative about the Bank's rules and
procedures for procurement, and b) when necessary, improve
procurement procedures and measures for greater efficiency
and effectiveness of implementation". This last
arrangement is reinforced by OD 11.00, which in paragraph
83 establishes that "all efforts shall be made to avoid
misprocurement, supplying commentary and consultation..."
6 During the first semester of 1995, there were also significant
delays in the Bank's response on the final stage of selection of
the firm that will carry out the studies for the second
approximation of the state zoning plan.
7 It is worth noting that the failure of the Bank to respond to
various correspondences sent by NGOs and leaders of social
movements conflicts with item 11 of OD 14.70, which asserts that:
Staff should be responsive, and encourage governments to be
responsive, to NGOs that request information or raise questions
about Bank-supported activities.
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