World Bank investments in commercial financial institutions are indirectly allowing land-grabs, evictions and pollution in Southeast Asia, a watchdog group charged in a report Friday.
By investing in banks and other so-called financial intermediaries, World Bank funds can increase poverty, social strife and promote projects which hasten climate change, according to a report by Inclusive Development International.
These investments by the World Bank’s private financing arm, the International Finance Corporation, violate its own guidelines on environmental and social conditions, the report alleges. “Once again, we have found that outsourcing the World Bank Group’s development mandate to private financial institutions is a recipe for disaster,” David Pred, the group’s managing director, said in a statement.
Pred’s US-based non-governmental organisation, which researches the activities of development agencies like the World Bank and Asian Development Bank, issued another report in October saying the IFC’s investments helped finance a “coal boom” across Asia even though the World Bank had pledged to phase out most support for coal-fired power.
