MEDIA ADVISORY

Friends of the Earth International

WORLD BANK MISSES HISTORIC OPPORTUNITY

WASHINGTON, DC, August 3, 2004 -- The World Bank Group today refused to
improve the way it operates. The Bank's Board decided to act upon only
very few among many concrete steps recommended by a key report.

The Extractive Industries Review (EIR), commissioned by World Bank
President James Wolfensohn, recently concluded that financial support for
projects in the oil, mining and gas sectors have not led to direct poverty
alleviation. The EIR made specific recommendations to improve the World
Bank's policies and practices. [1]

However, in a Board meeting today, World Bank Management and its Board
failed to respond with concrete commitments to change the way the Bank
operates and ensure poverty reduction results from its investments.

"The World Bank has ignored the EIR recommendations and endorsed business
as usual," said Jon Sohn of Friends of the Earth US. "The EIR called for
an 'extreme energy makeover,' and the World Bank opted for a cheap
pedicure. It has missed a historic opportunity to bring its lending more
in line with its mission to alleviate poverty."

The EIR report is a result of three years of investigation paid for by the
World Bank, and initiated after Friends of the Earth addressed Mr
Wolfensohn at the institution's annual meetings in 2000.

The report made many recommendations which had the broad support of civil
society organizations as well as many in industry. These included
respecting human rights, establishing a consent mechanism for affected
communities, protecting areas of high biodiversity and ending financing
for oil and coal projects. The World Bank only took some small steps in
response, such as requiring revenue transparency and disclosure of
information.

"The World Bank's response is a deep insult for those affected by its
projects." said Samuel Nguiffo of Friends of the Earth Cameroon. "The
Bank's Chad-Cameroon Oil Pipeline shows why the EIR recommendations are so
fundamental. The project is pregnant with as many undisclosed scandals as
there is sand on the beach".

The World Bank refers to the Chad-Cameroon Oil Pipeline as a model for
poverty alleviation, although it is quickly becoming a model for misery.
The Chadian government spent a portion of the first proceeds on military
expenditures, worker's rights have been violated, people lost their
livelihoods as a result of pollution, and impact mitigation plans lack
proper implementation.

"Oil projects like the Chad-Cameroon pipeline generate more tears than
smiles. The Bank's response to the EIR means they have not learned a
single lesson from such tragedies", added Mr Nguiffo.

"The EIR provided a historic opportunity to do things better, but the
World Bank dramatically failed to grab it," said Janneke Bruil in
Amsterdam. "Billions of misspent public dollars and sixty years of
outcries by people around the world have not been enough. What more does
it take?"

Friends of the Earth International --the world's largest grassroots
environmental federation with 68 national member groups in as many
countries and more than one million individual members-- is strongly
committed to non-violence.

FOR MORE INFORMATION CONTACT

In Washington, DC:
Jon Sohn +1-720-308-7482 or [email protected]

In Europe:
Janneke Bruil, Coordinator International Financial Institutions Programme,
Amsterdam, +31 6 52 118 998 or [email protected]

In Cameroon:
Samuel Nguiffo of Friends of the Earth Cameroon + 237-222 38 57 or
[email protected]

NOTES TO EDITORS:

[1] For more information on the The Extractive Industries Review see

http://www.worldbank.org/ogmc/
http://www.foei.org/ifi
http://www.eireview.info