The Multinational Monitor

JUNE 15, 1985 - VOLUME 6 - NUMBER 7


Aid: The Environmental Price We Pay

In the Name of Progress: The Underside of Foreign Aid
By Patricia Adams and Lawrence Solomon
Energy, Probe/Doubleday, Toronto
Reviewed by Cathy Watsonn

Foreign aid to underdeveloped nations is under fire from both the left and the right. Critics question both the motivation behind such aid and its impact on development In the Name of Progress: The Underside of Foreign Aid, a new book by the Energy Probe, criticizes aid less for its impact on the people and economies involved than for the environmental destruction that it leaves in its wake.

Hydroelectric schemes, while expensive and often disastrous, are still popular with aid agencies. Hydro projects are both highly destructive of the environment and acutely vulnerable to changes in it. They flood vast tracts of tropical forest, wipe out river fish. increase malaria and deprive flood plains of nutrients. At the same time, deforestation causes the reservoirs to silt up, cutting their years of usefulness by factors of three or four so that dams designed to work for 100 years last only 25 to 30 years.

Irrigation schemes and forestry projects are similarly disastrous, say the authors, Patricia Adams and Lawrence Solomon. Irrigation has not produced the high crop yields that it promised, but it has lead to salinization of the soil - leaving massive stretches of farm land (including a quarter of India's irrigated land) unfarmable.

The development project that holds perhaps the most potential for disaster is the Mahaweli River scheme in Sri Lanka. The world's largest development project, it is funded by $2 billion from the World Bank, Asian Development Bank, European Economic Community and aid agencies of the United Kingdom, Canada, West Germany, Sweden, Japan and Kuwait. Over 320,000 acres of rainforest and scrubland have been cleared for agriculture, leaving the Mahaweli River with only eight percent of its watershed. With Sri Lanka's heavy rainfall, the lack of an adequate watershed leaves the region open to devastation by floods and erosion.

Adams and Solomon put forth several reasons why aid agencies are insensitive to the environmental repercussions of projects:

  • The big aid agencies are 'have-money-must-lend' institutions. They have a quota of money for a region and it must be spent. This leads to unsound projects being hastily appraised and approved for loans without adequate evaluation of the environmental impact.

  • Aid agencies are biased toward big prestige projects like dams - which yield hefty contracts for multinationals and promote lump-sum aid payments.

  • Aid agencies believe that taking care of the environment is a luxury the Third World cannot afford and that pollution and environmental damage are prices that must be paid for `development.'

Curbs are difficult to impose on the aid agencies, say the authors, because the agencies are neither accountable to taxpayers in donor countries nor to the public in recipient countries. They act in secret, hide the costs of their projects, and exaggerate the benefits. Recently the United States Agency for International Development responded to criticisms from the Natural Resource Defense Council. After NRDC publicized the details of USAID projects, the agency was pressured into becoming marginally more accountable: now by law it has to carry out environmental impact studies and take environmental precautions if necessary.

Aid agencies like the World Bank claim they monitor projects for ecological problems, but Adams and Solomon argue that with only three or four ecologists out of a staff of 5,000 monitoring is patchy and cosmetic.

In the Name of Progress is excellent and correct in its description. It is in its prescription for change that it fails.

The book provides eight recommendations to make aid more humane, apt and useful. None of them are surprising or original and they are all a bit naive. They range from banning aid for projects that violate human rights to banning aid that furthers the donor country's foreign policy objectives. All the recommendations are based on the assumption that foreign aid is a humanitarian gesture.

But aid is rarely humanitarian or disinterested, and it is important that this premise be the starting point for any discussion on aid. Aid agencies are more interested in the conditions such as devaluation and import liberalization that are attached to their loans than they are in the specific projects. Taking time and paying attention to detail lays the foundation for environmentally sound projects, but this approach is uncommon in most agencies. Aid agencies are required to lend large sums of money regularly to maintain donor countries' leverage in the Third World. Environmental quality is bound to fare badly in that dynamic.

Political books on aid are often at fault for ignoring the environment. This book on aid and the environment falls short in underestimating the politics involved. But that criticism aside, it deserves to stand with Hayter's Aid as Imperialism and Moore-Lappe, Kinley and Collins' Aid as Obstacles as a book that describes yet another negative facet of aid.

Cathy Watson, a freelance writer based in London, co-authored the book Aid: Rhetoric and Reality.

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