A. Kiss, R. Cestti, J. Ebinger, A. Eftimie, A. Mirzagalyamova, A. Delarue, E. Montanari Stephens, D. Kapanadze September 2007 This paper examines the trade-offs involved in environmental mainstreaming, drawing upon experience from World Bank lending operationsover the past 15 years to explore how the trade-offs and challenges have been handled and also where mainstreaming has been more and less successful, and why. It is based upon a systematic review of recent World Bank lending operations (including specific investment loans, development policy lending and grants from the Global Environment Facility) from 1991–2007 in five economic sectors which are particularly significant in terms of their potential environmental impacts and the urgency of integrating environmental sustainability in policies and programs: energy, extractive industries, transport, agriculture and forest management.
Energy Sector
Overall, the energy sector presents a positive, if mixed picture, with good progress on increasing energy efficiency in a number of countries where a combination of policy framework and natural resource conditions have created a conducive environment. There remains, however, considerable room for improvement both with respect to energy efficiency in some countries, and in development of renewable/alternative energy sources in the region as a whole.
The industrial sector in general, and extractive industries specifically, have historically been a major source of environmental pollution and public health hazards around the world. Mine closings and privatizations both create the need and opportunity for environmental investment, but involve somewhat different objectives and trade-offs.
Beyond basic environmental good practice, mainstreaming environment in the transport sector involves addressing linkages among issues such as transport energy effi ciency, vehicle emissions, direct public health impacts, long-term climate impacts and individual rights and aspirations.
Agriculture is an economically and socially significant sector for all ECA countries, and provides the main source of livelihood in rural areas where poverty rates are often high. In keeping with the EU Common Agricultural Policy and world-wide trends, strategies and programs in this sector increasingly focus not strictly on agriculture but more broadly on rural development, including diversification of both on-farm and off-farm economic activities.
Forests in the ECA region, almost entirely state-owned, suffered widespread cutting during the early 1990’s with the general collapse of state control systems and fuel supplies. Governments are struggling to revise policies and institutions to support their shifting role from producers to regulators and providers of technical support including extension, services such as fi re and pest control, and sustainable forestry certification systems.
Development Policy Lending (DPL) offers a different entry point for mainstreaming environment in economic development. DPLs provide quick-disbursing financing to support fundamental policy and institutional reforms within a given sector or across the economy as a whole.
Environmental Assessment continues to be an essential tool for ensuring attention to environmental issues at the project level, while Strategic Environmental Analysis is increasingly playing the same role at the program, strategy, policy and institutional levels. At the same time it is important to transcend the “do no harm” mentality and replace it with a commitment to take proactive measures to improve environmental management.
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