South China Morning Post
May 13, 2002

The ADB convened an inspection panel, and the bank was found to have violated guidelines for failing to gauge the social or environmental impact of at least five of its development projects including the Samut Prakarn waste water project.

Protest groups have slammed the Asian Development Bank for violating its own lending rules and worsening the plight of the poor. They criticised the bank yesterday for failing to gauge the social or environmental impact of at least five of its development projects in the region. “The bank’s policies are not being implemented at the project level,” said David Batker, a director of the Asia Pacific Environmental Exchange, which is based in the United States. Mr Batker’s group was one of several non-governmental organisations at the ADB annual meeting.

Their ranks were thin and their objections raised quietly as the groups had been warned by the Chinese authorities of stiff punishment for any public protests. The actions of these organisations in Shanghai contrasted sharply with those at last year’s meeting in Honolulu, during which about 500 protesters blew on conch shells and chanted. Only 40 people from non-governmental organisations, most officially accredited by the ADB, attended the Shanghai gathering. They used e-mail and news conferences to get their messages out. In his closing remarks, ADB president Tadao Chino pledged more dialogue with such groups and a review of the bank’s inspection process after widespread criticism of a US$ 750 million waste water treatment project in Thailand’s Samut Prakarn province. The organisations cited several other ADB projects which they said had hurt the poor in Asia. These included road projects in Sri Lanka and Cambodia which had displaced residents, privatisation of a water utility in Manila and power sector reforms in India’s Madya Pradesh province that threatened to lead to increased prices. “Not only is the bank’s work not enough, it is grievously misdirected – and clearly knowingly,” the Philippines-based Non-Governmental Organisation Forum on the ADB said in an open letter.

Groups said they worried bank projects which aimed to privatise water and electricity utilities would bring higher prices, increasing the burden of the poor. They also quoted residents as saying the Samut Prakarn waste water project, by failing to remove heavy metals, dumped toxins on mussels. The ADB convened an inspection panel on the project – its first ever – and the bank was found to have violated some guidelines. “It is the bank which should take the blame for not providing proper justice to the people,” Hermantha Withanage of the Sri Lankan-based Environmental Foundation told reporters. Representatives from some ADB member countries – including Australia, Canada and Britain – took the unusual move of mentioning Samut Prakarn in their statements to the board of governors. Mr Chino said the bank had learned painful lessons from the project and would begin a review of its inspection process soon. He said the bank aimed to complete the review this year for discussion by the board next year.