No request for release of forest funds, says World Bank

The World Bank says that it is ready but has not yet been asked to release money for projects to be funded by payments from Guyana’s forest partnership with Norway.

International institutions involved with the Guyana REDD+ Investment Fund (GRIF) have faced criticisms recently – most notably by President Bharrat Jagdeo – for the non-disbursement of funds for projects. The GRIF is the financial mechanism through which Oslo will pay up to US$250 million for Guyana’s performance on limiting greenhouse gas emissions from deforestation and forest degradation, and for progress made against governance-related indicators. The World Bank is the trustee for the GRIF.

Norway has so far paid US$68M into the GRIF and government has identified several projects for funding. But no money has yet been released for the projects and Jagdeo, at a recent media briefing, said it was “absolutely false” that government has not submitted projects to the Steering Committee (SC) of the GRIF.  “We have three projects before the Steering Committee: one to deal with solar panels, another to deal with the Amerindian Development Fund and the third has to do the demarcation of Amerindian lands,” he said.

“From a layman’s perspective, everyone would recognise immediately that these are no-brainer projects. All the communities want the solar panels so there is acceptance by the indigenous community. The solar panels are not going to create negative externalities: that is environmental or social problems to these communities. So there it’s just a straightforward issue of a transparent procurement system which we’ve had and a Danish company has now won the bid yet we’re stuck in this cycle of non-disbursement,” said Jagdeo.

The GRIF SC is chaired by Guyana and comprises Guyana and Norway.

In a statement responding to questions from Stabroek News, the World Bank said that it remains ready to transfer funds to the respective Partner Entity once the GRIF SC approves a project and the Partner Entity asks for the funds. The statement said that the SC has not yet approved any projects. “To date we have only been asked to transfer US$ 305,000 to the IDB for project preparation, and we have made the transfer,” said the Bank.

The last SC meeting was held on May 12 and on June 16 the SC approved the project concept note for the Institutional Strengthening in Support of Guyana’s Low Carbon Development Stra-tegy (LCDS) project and agreed to finance project preparation by the Inter-American Development Bank (IDB). The objective of this project is to enhance Guyana’s institutional capacity to address the impacts of climate change, ensure the effective implementation of the LCDS, and meet its commitments under interim REDD+ partnerships. This project concept note for institutional strengthening is the only one to have been considered and approved by the SC, according to the minutes posted on the Low Carbon Development Strategy website. The other projects posted on the LCDS website are the Amerindian Land Titling and the Amaila Falls Hydropower project.

As part of safeguards, several agencies including the IDB, the United Nations Development Programme and the World Bank have been approved as ‘Partner Entities’ in implementing projects and the World Bank statement pointed out that the Trustee transfers funds to these agencies. “Only Partner Entities can disburse funds from the GRIF to the implementation agencies – as determined through a Grant Agreement,” the World Bank said.

“The Steering Commit-tee has yet to approve any projects. It needs to be understood that the Trustee does not participate in any of the decision-making processes.

As GRIF Trustee, the World Bank is invited only to observe Steering Committee meetings. GRIF Partner Entities are responsible for evaluating the feasibility of and preparing projects to present to the Steering Committee for approval,” the Bank said.

The World Bank said that to date, it has not been invited by the government to be a Partner Entity for any GRIF-funded projects and is not involved in any step of project preparation – from project identification, feasibility and due diligence, to preparation and implementation.

“The due diligence for each GRIF-funded project is carried out only by the respective Partner Entity. As required by the GRIF Administration Agreement with Norway, Partner Entities supervise projects according to their own fiduciary, social and environmental safeguards, and operational policies and procedures, and report on implementation progress and results,” it said.

Jagdeo said that owing to the non-disbursement of money from the GRIF, government has moved to tap into the budget to fund solar panels for hinterland villages and is prepared to do the same for land demarcation exercises.

He said that hopefully by that time, “some elements in the international community will get their act together and reimburse us” for the money spent. “But I think it’s only through Norway and Guyana that we’d be able to unlock the money out of the financial institutions,” he said.

In relation to the land titling project, the President said that all the money was needed for is to pay the surveyors “yet it becomes a mega-million dollars project for these institutions because some of them simply are not seized with the sense of urgency.”

According to Jagdeo, the World Bank will earn close to US$800 000 of the first US$30M just for passing money through the Bank while “the people who are supposed to benefit haven’t seen a cent.”

He reiterated that there is a need for new instruments in relation to dealing with climate funds.

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