Development or Displacement?


ICIJFormed at the end of World War II to help develop countries torn by war and poverty, the World Bank is dedicated to improving the lives of the world’s poorest: to getting them clean drinking water, housing, food, and basic services like electric power. It is a challenging and complicated mission.

The Bank loans $65 billion annually for what have become increasingly large, high-profile projects such as dams, pipelines, and power plants. Projects of this magnitude can displace whole communities and wreak havoc on the natural environment. Sometimes providing water or energy to a city can drastically reduce the quality of life of rural farmers and fishermen. While the Bank has a clear policy of “do no harm” to people or the environment, all too often the Bank’s projects do negatively impact the environment and the lives of the very people the Bank was designed to help.

“Over the last decade, projects funded by the World Bank have physically or economically displaced anestimated 3.4 million people, forcing them from their homes, taking their land or damaging their livelihoods.”
International Consortium of Investigative Journalists (ICIJ)

Complaints about the World Bank are nothing new; protests have taken place throughout much of my adulthood. Just a couple of weeks ago the International Consortium of Investigative Journalists added data to fuel the fire when it released the results of a year-long research project involving more than 50 journalists from 21 countries. They analyzed thousands of WorldBank records, interviewed hundreds of people, and conducted on-the-ground investigations in Albania, Brazil, Ethiopia, Ghana, Guatemala, Honduras, India, Kenya, Kosovo, Nigeria, Peru, Serbia, South Sudan, and Uganda. They titled the report, “Evicted and Abandoned: The World Bank’s broken promise to the poor.”

The report states that the World Bank has “regularly failed to enforce its rules, with devastating consequences for some of the poorest and most vulnerable people on the planet.” The most common hardship suffered by those in the path of “progress” is lost or diminished income. Forced relocations involve millions; they can rip apart kinship networks and increase the risk of illness and disease. Resettled populations are more likely to suffer unemployment and hunger, and mortality rates are higher.

“From 2009 to 2013, World Bank Group lenders pumped $50 billion into projects graded the highest risk for ‘irreversible or unprecedented’ social or environmental impacts — more than twice as much as the previous five-year span.”
International Consortium of Investigative Journalists (ICIJ)

What causes such a well-intentioned mission to go awry? When the Bank is filled with so many people who are dedicated to serving others and making the world a better place, why do the systems become dysfunctional?

  1. Bias is a human reality, and partnership is tricky. All too often, well-intentioned efforts to serve result in the world’s poorest and most historically oppressed suffering even more. Partly that is because we don’t validate what local communities know, and lenders want “experts” in the lead on projects. No matter how committed the Bank might be to partnering with local communities, bias runs deep and it’s an enormous challenge to be sure the expertise, experience, concerns and insight of all involved are heard and valued. It is a reality ripe for Cultural Detective and other intercultural tools, wouldn’t you say?
  2. Greed and glitz, blind capitalism, and the appeal to ego (and to continued funding) of the big, dazzling projects. Major infrastructure projects look good on a dossier or resumé, and they help ensure that member states will pony up the money to support the Bank’s efforts. According to the Evicted and Abandoned report, a 2012 internal audit found that projects in the Bank’s pipeline triggered the Bank’s resettlement policy 40 percent of the time—twice as often as projects the Bank had already completed.
  3. The gap between international funders and national and local governments. The Bank negotiates with those in leadership positions, who themselves may not only have the welfare of the people at heart. Or, there may be different leaders who control different regions or areas, and who consider an agreement with the national government not worth the paper on which it’s printed. Cultural Detective West Africa includes a critical incident on this very topic of negotiating with national governments when it’s local chieftains who control the territory.
  4. Corruption. Corruption can exist at all levels, including soldiers who have been known to beat, rape, and murder in the course of forced evictions. The Huffington Post reports: “’There was often no intent on the part of the governments to comply—and there was often no intent on the part of the bank’s management to enforce,’ said Navin Rai, a former World Bank official who oversaw the bank’s protections for indigenous peoples from 2000 to 2012. ‘That was how the game was played.’” While there are cultural variations in whether we hire those we know and trust or whether we have public, transparent job calls, there is a line beyond which corruption must be called corruption. For example, relocating poor villagers without restitution so that your son-in-law can own an elite oceanside resort is clearly not true leadership. The Cultural Detective series has some powerful critical incidents about the effects of cronyism and how to honor preferential treatment for family, while also ethically honoring one’s goals, as well as incidents dealing with bribery and other ethical issues (Cultural Detective Global Business Ethics).
  5. The world stage is shifting. There are new development banks on the world scene, competitors to the World Bank, that often don’t have the same social standards. Many say that this is leading to ever-lower standards, and disregard for the people and environments that “development” seeks to serve.
  6. Changing a large dysfunctional system is far from easy, no matter how well-intentioned even a top leader is. I’ve seen this in many of my clients over the years, and in a few corporations I’ve worked in as well. Many felt hope when Jim Yong Kim took over as president of the World Bank in 2012. A Korean-American physician known for his work fighting AIDS in Africa, Kim Yong became the first World Bank president whose background wasn’t in finance or politics. Twenty years earlier, Kim Yong had joined protests calling for a shutdown of the World Bank and accusing it of valuing economic growth over assistance to the poor. Despite expected improvements, “an internal survey conducted last year by bank auditors showed that 77 percent of employees responsible for enforcing the bank’s safeguards said they think that management ‘does not value’ their work. The bank released the survey in March, at the same time that it admitted to poor oversight of its resettlement policy,” according to the Huffington Post article. A 2014 World Bank internal review found that in 60 percent of sampled cases, Bank staffers failed to document what happened to people after they were forced from their land or homes, and 70 percent of the cases sampled lacked required information about whether anyone had complained and whether complaints were resolved.

In my opinion we need the World Bank, just as we need the United Nations. For all their foibles and failures as human-run entities, their missions are crucially important. Incorporating cross-cultural best practices into the manner in which projects are managed, meetings are conducted, and decisions are made is a critical first step. Developing intercultural competence in the Bank’s staff and local partners in an ongoing, sustained manner, can make a major contribution to preventing the devastating downsides of development projects.

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