Clarification on the GEF grant

Clarification on the GEF grant

Source: Jakarta Post, October 28, 2002

The Mining policy may lead to lower grants article published on Oct. 22 was evidently based on discussions during and after the recent Country Dialogue Workshop on the Global Environment Facility (GEF) held in Jakarta. It quoted statements from our Senior Biodiversity Specialist, Dr. Kathy MacKinnon. The article covers several important issues related to Indonesia's future ability to attract funds from the GEF and other donors. However, its title is misleading, and so is the implication that the World Bank or the GEF have a policy that would lead to the withholding of grant funds because of legislative approval for six open-pit mining operations on forest land.

The topic at the workshop related to the article was Indonesia's credibility as a future recipient of grants to support biodiversity conservation. Indonesia is receiving considerably less grant funding from GEF than its status as arguably the world's foremost country for both terrestrial and marine biodiversity would merit. The point Dr. MacKinnon was making is that grants for biodiversity conservation are limited and that in choosing where to use them, donors no longer consider only the ecological value of the resource. The probability that the conservation effort will be successful and sustainable is also an important aspect of the grant funding decision. The illegal logging in many of Indonesia's national parks is well-known to the donors, and they also understand that the factors that make it difficult to control are not so much limited technical capacity as they are weak law enforcement and lack of political will. Donors can assist with capacity-building but not with political will, and they can be expected to remain skeptical about future grant funding for national parks in Indonesia until they see some progress in that area.

Similarly, if there is a risk that a conservation area could be opened for mining, donors like GEF will likely choose to put their money elsewhere. That the legislative approval for six companies to resume open pit mining operations in forested areas set aside for watershed protection would trigger a reduction in grant funding for conservation was not a part of Dr. MacKinnon's message, nor is it the opinion of the World Bank. The Bank has, however, for a long time urged that any decisions regarding land use changes in Indonesia's official forest estate be made transparently, in consultation with all stakeholders, and in consideration of all relevant information including potential environmental, social and economic impact.

Tom Walton, Environment and Safeguards, CoordinatorWorld Bank Office, Jakarta