IDB approves US$17.2M environment loan

-WPA calls for suspension of disbursement

The Inter-American Development Bank (IDB) last week approved a US$17.2M loan for Guyana that is to be used to strengthen the environmental sector but the Working People’s Alliance (WPA) has expressed concern that it was done in the absence of National Assembly.

The loan was approved on February 11, 2015 and is the second of a two-operation Programmatic Policy Based Loan (PBP) directed at strengthening the environmental sector in Guyana. The first operation in the PBP series was approved on December 4th, 2013 for US$16.92 million.

According to IDB documents for the new loan, it will enhance the regulatory, institutional and monitoring structures to support the implementation of the Low Carbon Development Strategy (LCDS).

The objective of Component 1 – macro-economic stability – is to maintain a sustainable macroeconomic policy framework consistent with the objectives of the programme and the Policy Matrix. Component 2 aims at strengthening the implementation of the LCDS as the main regulatory instrument to establish an environmentally and economically sustainable development model for Guyana.

To support progress in the implementation of the LCDS, the second PBP requires that the Amerindian Development Fund be established with initial Guyana REDD+ Investment Fund (GRIF) funding, and that at least two new GRIF projects be approved and start execution, focusing on two sectors: public participation in general, and support to indigenous communities’ participation in particular.

Among other things, to support further improvements in environmental management regulations for the forestry and mining sectors the second PBP supports a strengthened Environmental Protection Agency (EPA) and its regulatory framework and includes amendments and/or regulations to the Mining Act, the Guyana Lands & Surveys Commission Act, and the Protected Areas Act.

Component 3 relates to institutional strengthening and focuses on establishing and operating a number of institutional planning and coordination mechanisms that would strengthen the Natural Resources Ministry’s ability to accomplish its objectives. Component 4 will support the continued operation of a monitoring, reporting and verification system and its utilization as a reliable instrument to monitor, report and verify forest carbon emissions resulting from deforestation and forest degradation in Guyana.

In a statement yesterday, the WPA expressed its concern that one day after the Parliament of Guyana was constitutionally due to be dissolved, the IDB approved the loan.

“The Working People’s Alliance views this loan with suspicion and disfavour given the recent High Court decision by the acting Chief Justice Ian Chang that the Minister of Finance Dr Ashni Singh has been unlawfully and unconstitutionally spending money that the country’s National Assembly had expressly disapproved,” the party said.

It pointed out that Guyana’s Governor to the IDB is Singh and questioned the timing of the loan and the motive and judgment of the Board in approving the loan on February 11. “The WPA is asking the (IDB) to publicly declare whether the loan has been disbursed and if not, to suspend its disbursement while the National Assembly is prorogued and in the consequential absence of any parliamentary oversight over public finances,” the WPA asserted.

The statement said that all moneys payable to Guyana, whether by loan or otherwise, have to be paid into the Consolidated Fund and can only be taken out from the Fund and spent by way of an Appropriation Act. “Obviously, no such Act can be passed while the National Assembly is prorogued or dissolved and any spending would therefore be further illegalities by the Minister and Governor of the IADB Dr. Ashni Singh,” the party said.

It said that it will be engaging the APNU/AFC coalition to publicise this “highly suspicious” loan by the IDB. “We will be recommending that the Coalition make it clear that should this loan be disbursed to the PPP/C government, the Coalition will have to consider whether and how it will accept responsibility for its repayment,” the statement said.

“The WPA reiterates our call to international and multilateral institutions to reconsider their relationships and financial dealings with the Government of Guyana during a period of prorogation and scheduled dissolution of the Parliament immediately prior to general elections,” the statement declared.

 

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