World Bank Board Discusses Inspection Panel’s Investigation of the Colombia-Cartagena Water Supply, Sewerage and Environmental Management Project

WASHINGTON, November 8th, 2005 — The World Bank Board of Executive Directors today discussed the findings of the independent Inspection Panel investigation of the Colombia-Cartagena Water Supply, Sewerage and Environmental Management Project, and approved Management’s Action Plan contained in the Bank’s Official Response to the Panel’s findings.

The Panel investigation responded to a request from the Corporación Cartagena Honesta, a local non governmental organization, on behalf of itself and residents of the areas affected by the Project - Cartagena, Punta Canoa, Arroyo de Piedra, and Manzanillo del Mar. The requesters claimed that their communities had been and would be further harmed from certain components of the project, such as a proposed submarine outfall for the disposal of municipal wastes that they said would pollute the marine environment and cause harm to their health and economic well-being, especially their fisheries.

The Project, financed in part by a US$85 million World Bank loan out of a total cost of US$117.2 million, aims to improve water and sewerage services in the Colombian coastal city of Cartagena, as well as the sanitary conditions of the poorest population, and facilitate the environmental clean up of water bodies surrounding the city. The Project will benefit all of Cartagena’s residents - - population one million, of which 85 percent are classified as poor. The Project will benefit, in particular, 400,000 poor residents by removing raw wastewater from low income neighborhoods and other parts of the city that flows in open storm water drainage canals.

The Project provides for, among other things, water supply and sewerage networks around the Ciénaga and in the northern communities, a pumping station and a large main wastewater conveyance system by land pipeline, a plant for preliminary treatment of the wastes at Punta Canoa, and a submarine outfall for the disposal of the wastes off the coast of Punta Canoa.

Edith Brown Weiss, Chairperson of the Inspection Panel, noted that “the appropriate disposal of wastewater is essential for improving the life for all residents of Cartagena”, and appreciated the urgency in dealing with this matter. The Panel also appreciated the efforts of Bank Management and staff to design a good project and in providing access to relevant documents. The Panel especially thanked the Colombian authorities for their support of the investigation and for facilitating the Panel’s work.

While the Panel found that the Bank had complied with many of the Bank’s Operational Policies and Procedures, it also found important instances of non-compliance. The Panel found lack of compliance with some aspects of the Policies on Environmental Assessment, Financial Management, Economic Evaluation, Poverty Reduction and Project Supervision. In the Panel’s view, Management did not address early and effectively the interests of all communities affected by the Project, namely, the Afro-Colombian communities north of Cartagena who could be adversely affected by the Project. The Panel highlighted the need to ensure that the communities are made beneficiaries of the Project.

With respect to the design of the submarine outfall, the Panel found that the computer modeling on which the outfall design is based may not account for the rather special oceanographic conditions of the Project area in determining the risks to human health and the marine environment. The Panel noted that more sophisticated three-dimensional models are readily available to assess those risks.

Management noted its appreciation of the efforts of the Panel. They highlighted that both sides have done a great deal of work and there are many points of agreement between the Panel and Management. Management stated that their Response and Action Plan laid out in detail a range of actions that address the concerns raised by the Panel. Management added that while they may differ technically with the Panel on the level of risks from the Project to the affected communities, they do not differ in sharing its findings that these communities have legitimate concerns and should share in Project benefits.

Management’s Action Plan includes actions to: carry out an independent analysis on the design of the submarine outfall; fully articulate and communicate to the public the emergency plan to address possible disruptions involving the overland pipeline; study alternative disposal methods for solids; and support a program to strengthen fishing activities. In this latter regard, Management noted that it is committed to a time bound plan relating to follow-up actions and indicated re-doubled efforts to consult with the affected communities. As promised in the Action Plan, Management agreed that they will update the economic analysis to include the additional investment cost of a higher level treatment as specified in the environmental license issued by CARDIQUE, the regional environmental authority.

Following the discussion at the Board, the Executive Directors endorsed the Management Action Plan with the caveat that Management and the Panel meet to discuss the modeling approach for assessment of the risks of the submarine outfall and to assure that the most appropriate project design is considered. It was agreed that Management would submit to the Board a progress report on the execution of the Project and Action Plan within six months.

The Executive Directors commended the Inspection Panel’s Report and the Action Plan developed by Management. Participants recognized the importance of having the Panel as a mechanism for accountability, transparency and inclusion in Bank operations. World Bank President and Chairman of the Board, Paul Wolfowitz, highlighted the importance of the Inspection Panel’s independence and observed that this has been a fruitful process that has led to improved design in the Project and increased credibility with the communities.

The Inspection Panel is an independent entity within the World Bank that reports directly to the Board of Executive Directors. Its mandate is to ascertain, in response to requests related to specific projects, whether the Bank has complied with all applicable policies and procedures with respect to project design, appraisal and supervision.

For the complete Inspection Panel Investigation Report and the World Bank Management Report and Recommendations in Response to the Inspection Panel Report, please visit the Inspection Panel website:www.inspectionpanel.org

World Bank Colombia website:www.worldbank.org/co