International Finance Corporation review – entering the final weeks

The IFC review of its safeguard framework (see FPP E-news July 2010 and October 2010) is entering its final stage. The new draft proposed policies include some strong gains and some serious continuing concerns. ‘Free, prior and informed consent’ (FPIC) has finally taken the place of the previous approach of ‘good faith negotiation’ that is ‘successfully concluded’, a step that takes the IFC out of the realm of jargon and into an arena in which the standards can be better understood and defended more easily.

However significant problems remain, including: serious curtailment of the application of FPIC; different and weaker treatment of projects financed through financial intermediaries; staff still not being incentivized to use the safeguard system effectively; and a continuing lack of rigour in the changes to categorization of projects. Weak protection of basic human rights is also a matter of concern.

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