BUDHAGAALI (BUJAGALI) DAM PROJECT: HOW DIFFERENT WOULD BE THE SITUATION IF WORLD COMMISSION ON DAMS (WCD) GUIDELINES WERE ADOPTED BY THE WORLD BANK?

F.C. OWEYEGHA-AFUNADUULA

NAPE/SBC/ ANTI + BUDHAGAALI

DAM TASK COMMITTEE

Website: http://www.afuna.org or http://www.afuna.o-f.com

Email:afunaduula2000@yahoo.co.uk or afunaduula@afuna.org

Tel: +256 78 555 222 or +256 71 845461

Paper Based on a Talk to the Executive Directors of the World Bank on the Implementation of WCD Guidelines and How Different the Situation Would Be If the Guidelines Were Adopted by the Bank, 25-26 September, 2001, Washington DC, USA (Not given due to the September 11 terrorist attacks on the World Trade Centre in New York and the Pentagon in Washington).

R. CHAIRMAN, BOARD OF EXECUTIVE DIRECTORS OF THE WORLD BANK, HONOURABLE MEMBERS OF THE BOARD, LADIES AND GENTLEMEN

• Introduction.

I am greatly honoured to be here before you to talk about the implementation of the World Commission of Dams (WCD) guidelines and how different the situation would be if the guidelines were adopted and applied to the proposed Bujagali (Budhagaali) dam in Uganda

by the World Bank. It is not common that a representative of the civil society is given such a wonderful opportunity by this Board to address it.

It is very significant that this opportunity has been granted at a time when

• The dam debate appears to have reached a critical stage with the publication of the WCD report;

• Representatives of the global civil society have converged in Washington on the eve of World Bank/IMF meetings; and

• You have at long last agreed to remove the cloud of secrecy in which your decisions have in the past been made, and agreed to disclose more about your Bank's lending to the financially poor but genetically rich countries of the world.

That this Board has given me this opportunity is significant for another reason. The governors and you the executive directors of the World Bank [and those of the International Monetary Fund (IMF)] have in the past considered yourselves as political delegates rather than contributors to the pool of knowledge, skills and strategies for development. This has tended to make you listen to governments and only hear the noises made by civil society. Your partners in development have always been the political regimes on every continent. Many of these regimes have been despotic and have pursued political power and glory in mega dam projects, funded principally by the World Bank. Consequently, the circle of secrecy and conspiracy between the World Bank, the political regimes and the dam building companies has fuelled economic liberalisation without political liberalisation. Civil society has often been kept in the dark even when the decisions and projects emanating from you affect them directly as they have been the targets and presumed beneficiaries. Environmental governance for environmental sustainability has been a myth rather than a reality.

It now seems that this Board sincerely wants to listen to civil society. It must, because the goal of human survival, progress and sustainable development cannot be just a political, economic, business or technical matter. It must be more of a social enterprise requiring broad partnership, on equal basis, of those who give aid, the political regimes, various local, indigenous, national and global institutions and civil society. Development symbolism on the part of the World Bank can only be expected to generate, promote, and sustain chaos and de-development.

2 HISTORICAL PERSPECTIVE

The whole world remembers that the World Commission on Dams (WCD) process would never have a reality if the World Bank and the World Conservation Union (IUCN) were not collectively committed to it. Indeed the process was the brainchild of the two institutions.

The WCD Global Review showed clearly that large-scale infrastructure projects such as dams could have devastating impacts on the lives and livelihoods of affected communities, particularly in the absence of adequate assessments and provisions being agreed to address these impacts.

The WCD Global Review also provided extensive evidence to show that governments, in constructing huge dams, have often found themselves in conflict with the basic principles of good governance, which have been articulated in at least three international instruments namely;

• The Rio Principles

• The UN Declaration and Rights to Developments; and

• The UN Universal Declaration Of Human Rights.

That The World Bank and IUCN were the prime force driving The WCD process was significant in three respects:

• It showed that economists and the political leaders at the World Bank were ready to listen to civil society on social and environmental issues and possibly begin to make policies and conceive projects that are relevant, humanising and less harmful to humankind

• The World Bank was ready to listen to the two voices in the aid recipient's countries, where its money and dam projects are destined - the governments and the increasingly environmentally conscious civil society.

• By linking up with the IUCN to make the WCD process possible, an unambiguous message was being relayed to the whole world that the Bank was no longer going to ignore the social and environmental consequences of it's policies and the dam projects it sponsors.

• SIGNIFICANCE OF WCD PROCESS.

WCD marked the maturation of the complex dam debate. People and institutions from all sides of the debate surprisingly participated in the WCD process for a full 2 years to bring the process to a logical conclusion. We at NAPE and SBC participated fully in this process because we were convinced it was very timely; a great opportunity in crisis to explore alternative strategies and improve decision making in the global energy sector.

These are strong reasons why we think the World Bank should take WCD guidelines and recommendations seriously. However, there are more reasons why we think the World Bank should not disinterest itself in these guidelines.

First, civil society has changed The World Bank's efforts to raise awareness about the governance, participation, etc has contributed to this change. Civil society is no longer the unconscious accommodator of policies and projects that are harmful. Civil society is aware of the guidelines and recommendations in the WCD report that would greatly benefit humanity. Violence and chaos can be avoided if these guidelines are applied in decision-making and implementation of all dam projects. These guidelines are a more realistic framework of decision-making in the area of dams and the environment compared to those of The World bank.

Secondly, The World Bank president, James Wolfensohn, raised the hopes of civil society when he said:

“Dams offer huge benefits but sometimes at large costs. This report (WCD Report) will help guide our work in the future”(Dec. 2000).

It is well known that the World Bank has enormous leverage on the borrowing political regimes. If what the President of The World Bank said is true, then civil society expects that The World Bank will use this perception to convince the overzealous dam crazy regimes to accept the recommendations of WCD for the good of all humankind. Otherwise future dam projects are likely to be a major cause of violence and chaos, which will wipe out even the little socio-economic progress that will have been made in the poor regions of the world.

Third, huge dams have been a significant source of biological impoverishment and responsible for much social, economic, ecological, cultural and environmental crises on our globe. Fortunately WCD guidelines indicate how these may be avoided. Before any dam project is approved, the WCD criteria require that:

• There is complete understanding of the energy needs [of a country].

• A comprehensive evaluation of the best way to meet these needs is carried out before a project is undertaken.

• An assessment is done on the scope for demand side of management (DSM).

• An assessment is made on the decentralised supply options and community initiatives.

• Risk is fairly analysed and politically discussed.

• Cumulative impacts of projects are analysed.

• Available alternatives, their relevance and uncertainties are given full consideration.

• WHAT DIFFERENCE WOULD IT MAKE IF WCD GUIDELINES WERE APPLIED TO BUDHAGAALI DAM?

Now let me consider what difference it would make if the WCD guidelines were applied to Budhagaali dam.

But before I do that, let me remind this Board that one of the contentions we have had with this dam is that it was not strictly born out by business or development but by political consideration.

First, although studies indicated that of the huge dams purposed for the Nile Valley , Budhagaali is a very expensive one; political expediency in Uganda and perhaps at the World Bank and IFC dictated that Budhagaali dam process was initiated and kept on course at the expense of cheaper hydro power dam options.

Second, the Uganda Government shielded the preferred independent energy developer AES from international building.

These reasons were enough to indicate that the Budhagaali dam process was greatly flawed right from the beginning. But the process has gone on almost unabated until I have had to come before this Board.

Frustrated that the process has gone on with the full knowledge and connivance of this Board, we have concentrated on pointing out the risks that the dam poses if the Bank Okays it.

• Too many risks are imposed on the Ugandan Taxpayers and the country, not on the proponents of the dam.

• The Power Purchase Agreement (PPA) remains a mystery to the Ugandan taxpayer. Ignorance reigns on exactly how the risks are to be allocated.

• AES's choice of data according to an IFC study done by Acres International ignored three important issues;

• The highly variable hydrology of the mile since 1954.

• The most critical dry period of 1907-10 and the second driest period of 1921 –22.

• Future water users other than states bordering Lake Victoria , the source of water for Owen falls dam, Owen falls extension dam, (Kiira dam) and other planned huge dams.

• Uganda is rumoured to be the one required by the secret PPA to assume most of the hydrological risks; the country is compelled to buy a set amount of power even if the dam is unable to produce its full output.

• East Africa has been predicted to have a severe drought in the next 15 years. The Nile will be disastrously affected, thereby putting Budhagaali dam at even more risk.

• The project is designed to ensure that private risks are socialised.

• The culturally important waterfall will be drowned, and the thriving tourism industry that local leaders are convinced is more beneficial to the communities than a dam will be destroyed.

• The habitants or the many haplochromid cichlid fish many of which remain undescribed; and the recently established archaeological sites in the area shall be destroyed. (NEMA approved AES's project on the ground that their were no archaeological sites (Stratton, 2001)

• With so many undescribed indigenous fish species made extinct, fisheries will be damaged and not improved as AES's E.I.A claims.

These are real risks.

Strictly speaking, it does not make sense to apply WCD guidelines to an already flawed, risk-ridden project. This would be whitewashing of an indefensible project – economically, socially and environmentally.

If we consider the social aspects of the project, AES has unveiled what it calls “resettlement and community development plan” (RCDAP) for Budhagaali Dam outside WCD guidelines. There are many problems associated with the plan.

First, the budgets for resettlements, compensation and development were arbitrarily fixed. ($11.1m for resettlement and compensation, $125,000 for cultural property management and $9.3 for community development)

Second, the budgets are inadequate and are likely to bring and cause social disasters instead.

Third, the EIA underestimated the number of people to be affected by the dam. It shows that only 8,700 will be affected, but independent studies indicate that the dam will result into the loss of land and other assets affecting some 33,608. The 2.4 million Basoga (99 clans) will lose culturally and spiritually.

Fourth, the cultural property management plan includes resettlement of spirits, which is a myth. It ignores that cultural beliefs cannot be relocated.

Fifth, the compensation plan rests heavily on cash payments. The World Bank itself admits this method of compensation breed's further poverty.

Sixth, the community development budget is too modest and focuses primarily on infrastructure provision. There is little focus on restructuring livelihoods.

Seventh, the EIA does not outline a community participatory strategy that affords the affected people a stake in the project and the decision-making. Participation

Should be either proportionate to the risk that the people have incurred or likely to incur through the loss of their lands and/or culture.

Eight, AES is implementing its highly flawed compensation and resettlement programme even before this Board makes a decision on whether or not to fund the project.

It is known that AES is now legally in Uganda since the agreement it made with the Uganda government to show its financial viability within a certain period that expired long ago, as did the extensions of that period.

5. STUBBORN AES: WCD GUIDELINES BELATED.

Therefore, it is easy to see that since AES pursued and is pursing its project outside WCD Guidelines, the project is anathema to good economic governance and decision-making.

In our view, trying to fit WCD guidelines onto the Budhagaali dam will not change the status quo of the project. Applying The World Bank guidelines to the dam would be orthodox and just as expected for the project to go ahead despite its flaws.

Therefore, evaluating Budhagaali dam against WCD guidelines would seem to be an academic exercise only. The difference it would make has been overtaken by time.

• No needs assessment was done to ensure that the project actually meets local needs as WCD recommends

• No studies were made by Uganda to assess the scope for demand side management before the project was embraced; as WCD recommends.

• Available alternatives, their relevance, consequences and uncertainties were not given adequate attention as WCD recommends.

• Cumulative impacts of the projects remain unanalysed. Even the environmental impacts of the past huge dams on the Nile are not known, as WCD recommends.

• All risks-immediate, medium and long-term were not identified, articulated and addressed explicitly by the proponents of the project. There was, therefore, no opportunity to determine the acceptable level of risk through a collective political process as WCD recommends.

Therefore, if the project is to be pursued, and measured against WCD guidelines, thoroughly, the owners need to go back to square one. Anything else as stated before, would be whitewashing the project and is likely to be perceived as dishonest, fraudulent and criminal – an antithesis of development.

At this stage, it is important to stop, think and ask: “Is power really the critical thing that Uganda needs to eradicate poverty as the proponents of Budhagaali dam have often reasoned?” In our view the future of Uganda does not lie in huge dams or manufacturing. The future of Uganda lies in agriculture and tourism .We believe that alternative energy resources would fit in with the reality of development, which puts the people at the centre of the social economic process. However serious concern for the energy needs of the poorest of the poor must include a concern for the renewal of fuel wood. Whatever developments in the energy sector in Uganda , for the majority of citizens fuel wood will for long time remain the principle energy source.

BIBOLOGRAPY

• Oweyegha-Afunaduula, F.C. F. Muramuzi & M. Musumba (2001), World Bank /IMF Policies and Projects in Africa: the case of Budhagaali (Bujagali) Dam Uganda . Paper for an Educational Symposium on Social and Economic justice Issues under the theme “Ending Global Apartheid”, Washington D.C. 27-29, 2001.

• Stratton, A. (2001). Iron smelting sites in Mukono In The New Vision, August 20, 2001 (Features), p.29