World Bank Country Repre-sentative Giorgio Valentini has reiterated that Guyana’s inability to access the US$30M deposited by Norway into a fund under the Bank’s supervision is not the institution’s fault.
Speaking to Stabroek News on Monday, Valentini said that the World Bank could only disburse the funds when approval has been given by the Steering Committee of the Guyana Redd+ Investment Fund (GRIF). Recently, World Bank Director for the Caribbean Yvonne Tsikata had said the money could only be released until the green light is given by the steering committee.
This committee, Valentini said, comprises of representatives from Guyana and Norway, with the World Bank playing an observer role. He said that contrary to the view expressed in Monday’s Stabroek News editorial, the World Bank does not have any decision-making ability in the committee. Valentini pointed to the Administration Agreement of the GRIF, which says: “The Steering Committee will be chaired by the Government of Guyana, and its members will be the government and the contributors to the GRIF.” The document also states that “any decisions of the committee will be made by consensus” adding that “the Trustee, each of the GRIF partner entities, civil society organizations and private sector entities will be invited to participate in the Steering Committee as observers.”
Valentini also rejected statements made by Norwegian Minister for the Environment and Inter-national Development Erik Solheim during an interview with the Washington Post, where he said that much of the delay stems from the environmental, human rights and fiduciary safeguards the World Bank requires. “All these are good, but it takes time, it makes things slower,” Solheim told the Post, adding that to be fair, while Norway was also frustrated with the delays, the safeguards were “forced upon the World Bank by countries like Norway.” Solheim said that when it comes to Norway, “We do not need a huge number of safeguards. It has to be non-corrupt, the money needs to be spent on [preserving forests that are] sequestering carbon.”
According to Valentini, the criteria mentioned by Solheim are not applicable in this case, and it is solely for Guyana and Norway to decide this. He said that the World Bank was only responsible for disbursing the funds after the decision was made. “We, the World Bank, cannot speed up the process,” Valentini said. He said that the Trust fund that both countries decided on to disburse the funds was a Fiduciary Intermediate Fund (FIF), which takes two months to be processed.
Meanwhile, Valentini objected to recent statements attributed to President Bharrat Jagdeo during his press briefing last week. Jagdeo had said that the World Bank is charging Guyana some US$700,000 just to have the money pass through what is akin to a current account. “It took us from September last year to now, to negotiate what is basically…the setting up of a current account, which you can walk into a bank and set up in a day. Because that is all that the World Bank is doing,” Jagdeo said.
Regarding the US$700,000 Valentini said that this amount had been agreed to the Steering Committee to meet administrative costs of the World Bank. He said that if a lesser amount is incurred, the money not spent will be returned. He pointed to the Administrative Agreement which said that the “Administrative costs incurred by the Secretariat and the Trustee shall be charged to the GRIF on an actual basis.” According to the document, “Estimated costs for the Trustee and Secretariat charged to the GRIF will be approved in advance by the Steering Committee on an annual basis and shall be subject to an end of year adjustment based on actual costs incurred.” It said too that the World Bank, following the deposit of the first installment, can deduct US$700,000 for costs incurred in relation to the establishment of the GRIF and for the estimated administrative costs of the trustee for the forthcoming year. “Such amount shall be subject to an end of year adjustment based on actual costs incurred,” it noted.
The GRIF is the financial mechanism for the ongoing cooperation on climate change between Guyana and Norway, in which Oslo will pay up to US$250M for Guyana’s performance on limiting greenhouse gas emissions from deforestation and forest degradation, and for progress made against governance-related indicators. Guyana will invest the payments it receives, and any income earned on them, in its Low Carbon Development Strategy (LCDS). Jagdeo, while in Cancún, Mexico, recently criticized the length of time the process was taking. Jagdeo, however, said that he is optimistic that the funds will be accessible by January, saying that the World Bank had shown greater urgency within the past few months after pressure had been put on it.