How the South lost its morality in Beijing

THE GLOBAL Environment Facility (GEF) meeting in Beijing recently marked the beginning of the first year after Rio. And it set the tone for the green world order of tomorrow -- a world in which Southern governments are conciliatory but persistent with their demand for more green funds; in which Northern governments are parsimonious with their money, but profligate with advice on the need for change; in which international NGOs become the new brokers between the North and the South; in which international bureaucracy stays strong with fresh leases of life, to spend the Northern taxpayer's money with green morality. Internationalism remained in Beijing where it always was: in the hands of the rich and the powerful.

The tangle over GEF illustrates the scenario well. The concept of a green fund was born in Washington and Paris with the role of the midwife being played by the World Resources Institute, a leading US think-tank, and the Organisation of Economic and Cooperation and Development. In November 1990, this green fund was launched as a three-year pilot programme, with about $1 billion in the kitty. The administration of the fund was given to the World Bank, but with some joint responsibility of two UN agencies, UNDP and UNEP. All said and done, the GEF was a guilt fund of the North to make amends for the global damage it had caused. But never was it described as such.

In the heady days leading up to the Rio conference, GEF became a thorny issue, with each side wanting to control the purse strings. The South argued at Rio that the fund should be so modified that its governance and decision making becomes democratised. The arguments were persuasive. Moreover, as the climate and biodiversity conventions were still being negotiated, the Southern countries, because of their large numbers, had some leverage. But the tussle was neither easy nor sweet and finally, an uneasy compromise was reached in Rio. The South agreed to consider the GEF as an interim instrument to transfer environmental largesse under the conventions and the North agreed to restructure the governance of GEF to make it "democratic and transparent."

But the key issue of voting remained unresolved. Agenda 21 -- the wishful environmental agenda produced at the end of the Rio conference -- gave form to this tussle between dollars and numbers by stating that there should be "balanced and equitable representation of the interests of developing countries, giving due weight to the funding efforts of donor countries." The post-Rio world has seen many convoluted formulations on this issue. The attempt of the donor countries has been to have a double voting system, in which the majority countries have a vote, but the donors have the veto.

However, within one year, the zest has gone out of the issue. The G-77 countries came to Beijing in a seemingly pragmatic mood to get what they could. As GEF chairperson, Mohammed T El Ashry put it, "There was a new tone of cooperation". The G-77 position paper accepted the once-hateful formulation of double voting and said that in cases where a simple majority does not work, double voting is required: a simple majority of members present and voting and a simple majority of votes related to contributions to the core funds. This effectively gives the dollar the veto.

In Beijing, the South not only lost its morality but even saw its most favourite demand of openness and transparency hijacked by the North. It was the US delegation which made the strongest plea for accountability in the GEF. The Clinton administration informally spread the word that they would put big money ($ 30 million, though many say this is not so big or generous) into GEF, provided it is made more accountable and transparent.

But with a difference. The Northern governments are talking about accountability -- not in governance of the GEF as the South was demanding, but in project management. International NGOs say that taxpayer's money must not be spent on environmentally destructive projects. Yet others are worried about the "absorptive capacities" of recipient countries and the quality of projects. In its non-paper (UN jargon for a non-official paper), the US demanded that "project approval must require a special majority of votes to ensure that GEF funds are given only to sustainable, high-quality projects." Delegates explained this essentially means that a project could be rejected if a certain specified minority of countries voted against it. All this only adds new controls and conditionalities on Southern governments.

In these developments, a new and powerful actor is the international NGO. Armed with prestige and green morality, it is playing an important role in monitoring and assessing environmentally destructive projects. The dynamics are simple. NGOs based in the North make alliances with groups in the South, monitor projects and, wherever necessary, use their clout with the US Congress or the German Bundestag to pressurise the World Bank to withdraw the project. Accepting the NGO role in quality control, the French government has suggested that there should be tripartite participation -- of governments, implementing agencies and NGOs -- in project reviews.

As things stand today, Southern governments have little choice but to accept this donor-recipient relationship, with promises of some more money heading their way. Essentially, this freezes inequality in the world: the North, which has caused global environmental problems, cannot be assessed for liability: the South, meanwhile, must beg for Northern generosity.