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88868
ECSSD Environmentally and Socially Sustainable Developmen
The World Bank Working Paper No. 29
January 17, 2001
Cultural Assets in Support of Transition
in the Europe and Central Asia Region:
An Operational Perspective
The ECSSD unit distributes this technical report to disseminate findings of work in progress and
to encourage the exchange of ideas among Bank staff and all others interested in development
issues. This paper carries the name of the author and should be used and cited accordingly. The
findings, interpretations and conclusions are the author's own and c,;hould not be auributed to the
World Bank, its Board of Directors, us management, or any member countries.
CONTENTS
INTRODUCTION ................................................................................................................................ I
CULTURAL AsSETS IN THE ECA REGION •..•..••..•..•.••..••.•...•....••..•..•.••.••..•.••.......••..•..••.••..•.......•..•..... 3
THE BANK AND CULTURAL AsSETS IN ECA ••.....•..•..•..•..•......•.•••.••.•..•..••••.••..•..••....••.••..•..........••...•. 4
Areas of Intervention .................................................................................................................. 5
An Assessment of Cultural Asset Interventions in ECA to Date ................................................ 7
The Bank Side- Project Preparation .......................................................................................... 7
The Country Side - Enhancing Effectiveness .......................................................................... I 0
THE WAY FORWARD-A STRATEGIC APPROACH •.••..•......•.••......•••..•..........•.•................•............... 13
Assumptions and Constraints .................................................................................................... 13
Guidelines and Recommendations for Intervention ................................................................. 14
ANNEXES
I. Matrix of Assistance Operations in the ECA Region- June 2000
II. Summary of the Framework and Lending Criteria found in Culture and Sustainable
Development: A Framework for Action
III. Cost Benefit Analysis: Principles and Methods
~bibliotcka
ii
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ACKNOWLEDGEMENTS
This repqrt was prepared by a team from the Europe and Central Asia (ECA) Region' s
Environmentally and Socially Sustainable Development (ECSSD) unit, coordinated by Mark
Woodward (Senior Social Development Specialist). Team members included: Thomas
Blinkhom (Lead Operations Specialist), Marina Djabbarzade (Consultant), Julian Lampietti
(Social Development Specialist), Rohan Selvaratnam (Operations Analyst), and June Taboroff
(Consultant). The team is particularly appreciative of the guidance provided by the Sector
Manager for Social Development, Alexandre Marc, and the ECSSD Sector Director, Kevin
Cleaver.
The team benefited from comments from Johannes Linn (Regional Vice President, ECAVP),
Maha Armaly (Operations Officer, ECSIN), Jeffrey Balkind (Senior Urban Economist, ECSIN),
Krezentia Duer (New Business Development Leader, SDV), Adrienne Nassau (Senior
Operations Officer, ECSIN), Margret Thalwitz (Sector Manager, ECSIN), and Maria Luisa
Wagner (Senior Liaison Officer, ECAVP). Particular thanks is due to Ms. Armaly, for
organizing feedback from the urban sector staff in ECSIN, who are responsible for many of
ECA's projects related to cultural assets.
This report was reviewed by the ECA Working Group on Culture chaired by Connie Bernard
(Director, OCCS) in May 2000 and then by ECA's Operational Policy and Procedures
Committee, also chaired Ms. Bernard, in December 2000.
iv
CULTURAL ASSETS IN SUPPORT OF TRANSITION
IN THE EUROPE AND CENTRAL ASIA REGION:
AN OPERATIONAL PERSPECTIVE
INTRODUCTION
1. The purpose ofthis report is to provide guidance to the staff of the World Bank's
Europe and Central Asia (ECA) Region with respect to mobilizing cultural assets to
support socioeconomic development in our country and regional work programs. To this
end it seeks to demonstrate how and when it makes sense for us to get involved in
activities related to cultural asset mobilization. Equally important, it also indicates how
and when we should leave cultural heritage activities to others. In particular, this report
addresses the following questions:
• What do we mean by integrating culture and cultural assets into our work?
• Why may cultural assets be of importance for a development institution like the
World Bank?
• What is particular about the cultural assets of the ECA Region?
• What lessons can be drawn from ECA's experience with interventions focused
on cultural assets to date?
• How should ECA staff address issues of cultural assets in the future?
2. This report is intended as an adjunct to the ECA Region's Social Development
Strategy. That strategy is all about promoting socially and culturally sustainable
development. This paper provides greater detail and focus on a specific part of the
Bank's cultural agenda, the mobilization of cultural assets in support of sustainable
development.
3. What do we mean by integrating culture and cultural assets? There are two
principal ways in which cultural considerations may be incorporated into our
development work. The first is to ensure that our country programs, projects, and
interactions with clients are informed by se11sitivity to culture. Experienced shows that
development activities are more likely to be effective and sustainable if they reflect the
interests and values of beneficiaries. In effect this approach to culture is synonymous
with saying that we want development to be socially sustainable. While culturally
Definitions:
Culture: the whole complex of distinctive spiritual, material, intellectual and emotional
features that characterize a society or social group. It includes not only arts and letters but also
modes of life, the fundamental rights of human beings, value systems, traditions and beliefs.
Cultural Heritage: consists of those aspects of the past that people preserve, cultivate, study,
and pass on to the next generation. Those achievements are embodied in material forms such as
buildings and in non-material forms such as the performing arts. Cultural assets are those which
has been valued in the past and are expected to be valued in the future. Since valuations and
expectations change over time, that which constitutes cultural assets can be subject to dynamic
change.
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sensitive development is critical to the Bank's mission, it is not the primary focus of this
paper. It is one of the focuses of the Region's Social Development Strategy.
4. The second approach is to view some aspectS of culture as assets or resources for
promoting poverty reduction and development. Cultural heritage, both built and living
cultural expression, can be viewed as a distinctive national patrimony worthy of
preservation or development as assets integral to a wider development strategy that aims
to alleviate poverty. In fact they can be regarded as both a stock and a flow which, if
properly managed, can generate a sustainable flow of income. The primary focus of this
paper is thus to assist ECA regional staff in bringing such assets to bear on our
development agendas.
5. Why are cultural assets of importance for development? Culture, treated as an
asset for development can:
• promote new economic activities, especially for marginal or vulnerable
groups, in labor intensive conservation works, tourism, handicrafts, and
other cultural industries;
• promote social (and cultural) capital formation, giving a sense of pride and
belonging to a particular community;
• increase social inclusion through community-based assistance,
employment opportunities, and urban regeneration;
• promote tolerance - in situations of internal and external migration, armed
conflict and forced displacement; as well as
• encourage participation in local level decision making and the
accountability of local level institutions.
6. At the same time it must be recognized that culture and cultural assets can also
play a negative role in socioeconomic development. One risk is that cultural assets may
be exploited in ways that do not create opportunities for raising living standards or that
damage cultural assets and the environment. For example, "enclave" tourism is unlikely
to provide much benefit to local communities. Similarly, poorly planned development
around cultural sites and their overexploitation may weaken local social cohesion,
produce tensions by, e.g., attracting labor from outside the community, as well as limit
future potential by degrading the sites and producing environmental damage.
7. Perhaps more important in many parts of the ECA Region is the relationship
between cultural heritage and ethnic conflict. The search for identity among many new
states in the region, which is often very exclusive and ethnically based, and their search
for founding myths, can have a strong influence on their interest in cultural heritage.
Hence cultural icons are often mobilized to instigate social separation, and in extreme
cases to promote social exclusion. The famous bridge over the Neretva River in Mostar,
Bosnia, destroyed in 1993 as a result of ethnic confrontation, illustrates the hazards of
culturally significant interventions. Reconstruction bas been advocated by those who see
it as a symbol of tolerance for ethnic/religious diversity 1 and has the support of the
Reconstruction is to be financed under the Bank-fmanced Bosnia (Mostar) Pilot CUltural Heritage
Project.
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municipal government and much of the population. However, social assessment in
Mostar found that some Croats view the bridge as a symbol of Ottoman domination.
Therefore, we must be sensitive to the possibility that our cultural interventions may
contribute to tensions under certain conditions.
CULTURAL AsSETS IN THE ECA REGION
8. What is particular about cultural assets in the ECA Region? With its roots in
centuries of dynamic contact between Built culture in the ECA Region encompasses:
European and Asian peoples, the • the monumental- the mosques of Uzbekistan
cultural assets of the 27 countries of and the cathedrals of the Ukraine;
the ECA Region remain varied and • the formerly commonplace - the vernacular
rich, encompassing both built and architecture of rural towns in Romania and
living culture. Examples of built mountain viJlages of Georgia;
culture in the region may be found in • archaeological sites - Uplistsikhe in Georgia
the adjacent box. It should be noted and Butrint in Albania;
that in this region of considerable • cultural landscapes combining natural beauty
religious diversity, sacred or religious with man's creative talent- the island of Cres
heritage is particularly important in Croatia, the hillsides of Orhid in Macedonia,
encompassing churches, mosques, and the Abbey ofTatev in Armenia;
synagogues, monasteries, madrase • historic towns and urban areas - St.
(Islamic schools), and mausoleums. Petersburg, Vilnius, Prague, Riga, Cracow
among many others.
9. The production of cultural goods and handicrafts is long standing in the region.
Most of the countries in the region have produced, and continue to do so, a range of both
utilitarian and luxury goods that transform local materials into objects of added value.
The carpets of Turkey and Armenia, silks of Uzbekistan and Azerbaijan, glass of the
Czech Republic, and musical instruments of many countries are all examples,
representing sources of employment and revenue for communities as well as civic and
national pride.
10. Culture plays an important role in the overall economy of the region. Cultural
assets are the springboard for cultural industries that in certain areas surpass traditional
industry in job creation and positive environmental impacts, spur tourism development,
and encourage overall community-based development. There are many examples of
success stories in the region: Prague trades on its art and architecture as unique selling
points; Turkey has maintained its handmade carpet and textile production; Poland exports
its traditional building skills; and St. Petersburg maximizes its imperial coJJections and
monumental urban features. At the same time, the co11apse of the Soviet Union led to the
coJJapse of some cultural industries. Thus tourism and crafts production in the Caucasus,
albeit on the increase, remain well below the levels of a decade or two ago.
11. However, culture and economic development do not always go together. Through
the accidents ofhistory, cultural patrimony is now often situated in areas of low income,
such as remote rural areas, old town centers, and areas of high biodiversity. This means
that there is considerable potential for mobilizing such assets to improve living standards
in such depressed areas.
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12. Nonetheless, since the dissolution of the Soviet Union and Yugoslavia, the
development p9tential of cultural assets faces severe institutional constraints. The most
striking consequence of the collapse is the extent of the decentralization that has taken
place. Ownership has often been transferred to municipalities resulting in a hiatus
between local and national government and the commensurate distribution of funds and
responsibilities. In the constrained fiscal environments of much of the region, funds for
the maintenance and development of cultural heritage have dramatically shrunk. Often
neither Ministries of culture or tourism nor municipalities have appropriate management
skills suitable for market economies. Furthermore, the collapse of the Soviet tourism
2
industry has meant significant declines in revenues for cultural activities.
13. Today the cultural assets of the region haVe lost neither their vitality nor meaning.
They therefore have considerable potential for galvanizing people in support of
community improvement programs, enhancing civic responsibility, and facilitating
efforts to help the poor and disadvantaged. However, in many ECA countries the cultural
sector is experiencing a ruinous lack of support that threatens permanent damage to
cultural assets and serious economic hardship to those working in the sector. The fact
that cultural assets were and still often are public goods in the ECA region and that they
are often non-divisible, provides an explanation as to why the market does not function
properly in setting the value of cultural assets at a socially efficient level. Therefore, to
address this challenge, management and utilization of cultural assets need a new vision,
one that encompasses public sector management/efficiency where cultural assets are
public goods, and one that transforms them from a liability and cost to productive assets.
THE BANK AND CULTURAL AsSETS IN ECA
14. Cultural asset protection and conservation are not new to the Bank. As early as
the 1970s, World Bank projects, particularly tourism projects, began to improve access to
cultural heritage sites in Egypt, Jordan, and elsewhere. Among the first project activities
in what is now ECA were those carried out in Turkey and the former Yugoslavia as part
of infrastructure, urban or envirorunental projects.
15. Within the last few years, there has been renewed interest in cultural development
in the ECA region. This has been inspired to a large extent by the realization among
many national leaders that greater respect and appreciation for culture are essential for
future social and economic development and thus should be integrated into country
development programs. Als9, there is growing concern that unless decisive measures are
taken to preserve truly distinctive cultural assets, they could be seriously jeopardized or
lost in the economic transition, thus depriving the nation of important legacies of national
identity as well as potential sources of tourism revenue. This has produced significant
client demand for projects to realize the development potential of cultural assets.
16. These developments coincided with renewed interest on the part of the Bank's
senior management in culture as an integral part of the development process. Initially,
the focus was mainly on conservation of global patrimony through assistance, with
' Of course decentralization can also bring benefits, notably since it means that more initiative can be
taken at the local level.
I
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experienced partners, to Bank member countries where cultural assets of regional or
international importance exist. In that spirit, the Bank convened a meeting with potential
partners in January 1998; participants included mainly organizations involved in physical
conservation ofheritage sites as well as those concerned with museum management.
Subsequently, a focal group for culture was established in a new Vice-Presidency for
Special Programs. This group initiated work on a cultural framework paper, which was
discussed in 1999 by the Board's Committee on Developmental Effectiveness and later
by the full Board. 3 The paper helped clarify the Bank's role in the sector, emphasizing
the need for assistance efforts to be designed so as to improve the institution's overall
effectiveness consistent with individual country strategies and to help enhance poverty
reduction strategies and programs. Throughout this period, several projects were
initiated, prepared or appro~ed in the sector; this effort was supplemented by a series of
workshops, conferences and special arrangements with partners. The Board expr~ssed
concern that some of this work was not consistent with the emerging operational
parameters for the sector; new guidelines were thus included in the framework paper and
endorsed by the Board in Apri11999 (see Annex II), and some projects that had been
initiated prior to these are currently being retrofitted to comply with them. The Board
also asked that a status report on the work Bank-wide be prepared for its review in about
18 months (from April, 1999).
Areas ofIntervention
17. Since the establishment of the ECA Region in the Bank, regional staff, at the
request of borrowing governments, have been active in building a small portfolio of
cultural heritage assistance activities. The first Institutional Development Fund (IDF)
grant for cultural heritage institution building was awarded to Albania in December 1993.
This was followed by other IDF grants and lending operations. To date, the region has
approved a total of almost $24 million for 11 separate assistance operations in the sector
including five investment projects or components of projects, six IDF grants (3 of which-
Vilnius, Georgia, Albania - are completed), and two small grants from the Development
Grant Facility for Culture. Annex I provides details on ongoing operations. In addition,
new lending activities in support of culture or cultural/environmental development
objectives are currently under preparation in Croatia, Macedonia, Turkey, and the
Caucasus.
18. A perusal of the region's cultural assets portfolio and activities under preparation
reveals that interventions tend to concentrate in the following six general areas (although
a few activities fall outside these categories):
19. Conservation of Cultural H eritage Sites. A majority ofECA's cultural assets
interventions involved the rehabilitation and/or restoration of cultural monuments. Many
of these activities were prepared prior to the adoption of criteria for Bank intervention by
the Bank's Board of Executive Directors in April1999 (see Annex II). Thus they do not
always respect the injunction that, "When the World Bank supports conservation of
monuments and heritage sites it is to achieve economic and social objectives.'' Where
this is a problem (as in the Azerbaijan Cultural Heritage Project), efforts are under way to
The World Bank (1999), Culture and Sustainable Development; A Framework for Action.
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retrofit such objectives into the activities. In contrast, the activities in Georgia, Romania,
and Mostar involve significant amounts of social assessment work, community
consultation, neighborhood renewal, and support for crafts development and rural
tourism. As of now the focus has shifted from the restoration of monuments to the
conservation and rehabilitation of cu~tural heritage sites/assets as a vehicle to
p r omote poverty r eduction.
20. Culturally Sensitive Urban R edevelopment. A significant portion ofECA's
cultural assets assistance is being provided to historic cities such as Vilnius, Tbilisi,
Mostar, and St. Petersburg. Conserving a city's historic environment enhances the
quality of life for residents by preserving traditions, protecting areas of architecture and
natural beauty, and generating civic pride. Such interventions involve a wide range of
activities: a site development plan to help conserve the historic section of Vilnius;
assistance for upgrading of historic structures and neighborhoods in Tbilisi's old town;
upgrading of historic structures and neighborhoods in Mostar; as well as provision of
grants for revenue-generating support activities - videos, catalogues, new ticketing
systems - for museums, theatres, and a library in St. Petersburg.
21. Institutional S trengthening . Much of the assistance activities to date also contain
a noteworthy complement of help for institution building or strengthening. This focus is
understandable in the IDF grants since this is their basic purpose. However, the pattern
emerges forcibly in the lending operations where the emphasis is mainly on helping to
establish new project management entities but also on strengthening management of
national cultural assets and cultural support programs more generally. One aim here is to
help fiscally constrained governments establish realistic criteria by which to judge
priorities in the sector and to explore new institutional mechanisms to help ensure
sustainable future support. For example, in the Bosnia and Herzegovina Pilot Cultural
Heritage project, the possibility of reorganizing the existing Stari Mostar Foundation as
an international foundation is being explored with the aim of attracting international
donors.
22. Planning/Policym aking for Cultural Assets. Notorious underfunding and
weakness in cultural asset management result in a need to address a variety of systemic
management issues. These include (inter alia):
• knowledge of the extent and significance of resources and their condition;
• efficacy of existing inventories as planning tools;
• planning and land use regulations to protect historic areas;
• concepts of area conservation planning;
• contested ownership claims;
• fiscal and financing issues;
• preventive conservation;
• introduction of economic analysis into project concepts;
• complacent publics and weak community participation;
• cultural heritage in school curricula;
• recruitment and staffing.
To date such issues have received inadequate attention in our portfolio. Nonetheless,
they are being addressed in some activities, and staff are increasingly aware of the need
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to understand theses issues when preparing projects. A case in point is the Vilnius
(Lithuania) IDF grant, which was used in part to update the legal framework governing
management of historic property with a view to encouraging more private support. As a
consequence of the IDF program, the Government of Lithuania has allocated a grant of
$3.7 million equivalent to fund follow-up revitalization works in the city.
23. Cultural Assets as a Vehicle for Community Development. Community-based
approaches to cultural assets show particular promise for "building on the cultures of
poor and marginalized groups", as called for in the framework adopted by the Board in
April 1999 (see Annex ll). Thus increased community involvement in cultural asset
management and development is increasingly being encouraged in some of the assistance
operations- i.e. the four Saxon villages pilot component in the Romania project, the
Tbilisi and Signaghi (eastern Georgia) components of the Georgia project, and the Tatev
pilot component in the Armenia IDF grant. This is also the logic behind the proposed
Community Based Trans-Caucasus Tourism Initiative.4
24. Tourism Promotion. Many of the countries in the ECA Region were significant
tourist destinations prior to the breakup ofthe Soviet Union and Yugoslavia. In the
former case the Soviet tourism infrastructure collapsed; in the latter European tourists
were driven away by conflict. Nonetheless, this means that there is considerable
potential that could be revived 5 . Doing so, in ways that promote income generation and
community development, is thus increasingly an objective of our cultural interventions,
as in Armenia, Romania, and Georgia. In addition, a project is being planned in Turkey
to enhance archeological and historic sites for economic growth through cultural tourism.
A n Assessment of Cultural Asset Interventions in ECA to Date
25. Most of the approved cultural asset interventions in the region are still in the early
stages of implementation and thus it is too soon to assess their full impact. The only
completed activities are three IDF grants- for Vilnius, Georgia, and Albania. However,
the design and preparation of these various activities, as well as the early implementation
results, can be instructive. The following paragraphs assess this experience from two
perspectives: processing on the Bank side and maximizing effectiveness on the country
side. From both perspectives, one of the general lessons that emerge is the need for
selectivity.
The Bank Side - Project Preparation
26. Impact 011 People, Particularly the Poor. The early assistance activities in the
ECA region generally were not explicitly designed to help alleviate poverty - the
overarching development objective of the Bank. It can be argued that assistance
operations focusing on, e.g., conservation of heritage sites will have an impact on people
generally through community engagement (social assessment work), site improvements
4
This is a proposal to leverage and create synergies with on-going cultural asset work in Armenia,
Azerbaijan, and Georgia to promote community-based eco-cultural tourism.
5
The Czech Republic and Hungary, which reap considerable economic benefits from cultural
tourism, are good examples of this potential being realized at a national level.
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and resultant jobs (even though temporary), competitive bidding, transparent decision
making, and public awareness campaigns. However, cultural assets activities could be
designed to explicitly address poverty reduction. Certain components in at least two of
the operations -pilot Saxon villages in Romania and the historic districts ofTbilisi and
Signaghi in eastern Georgia - provide financing for pilot income-generating activities
involving poor people and designed to preseiVe cultural assets. The recently approved
IDF grant for Armenia also has a similar objective.
27. Lesson. Much more can be done to ensure that when we engage in our cultural
assets activities, they contribute to the objective of reducing poverty. Cultural
assets may be viewed as opportunities to provide catalytic support to promote
community development and improve the living standards of the poor. Where
such possibilities do not exist, we should leave support to other agencies for
which support for cultural heritage is an end in and of itself.
28. Ad Hoc Approaches. The experience thus far reveals that while the assistance
bas been in response to client requests -mainly for the conservation of cultural sites or
institution strengthening - it has tended to be somewhat ad hoc. It bas not been informed
by any strategic direction (indeed this paper is intended to help provide such direction).
Furthermore, forth~ most part, it bas neither benefited from the sort of detailed
economic/sector work nor the detailed preparation work normally associated with Bank
lending operations. Moreover, none of the operations was mentioned explicitly in the
country assistance strategies, with the exception of the Bosnia and Herzegovina Pilot
Cultural Heritage project.6 Nonetheless, all of the assistance operations, in the objectives
sections of their respective documents, claim that the interventions would help support
key CAS goals in one way or another. A critical factor contributing to this ad hoc
approach is that virtually all of the assistan.ce operations to date have been seriously
underfunded through all stages of processing. The result is that task teams have had to
cope by various combinations of cutting comers and mobilizing trust funds. This often
has an adverse effect on the quality of preparation.
29. Lesson: We need a more strategic approach to the mobilization of cultural assets
in support of socioeconomic development. To provide such an approach at the
regional level is the purpose of this paper. At the country level, cultural
considerations in long-term development strategies need to be explicitly
addressed in the preparation of country assistance strategies, comprehensive
development frameworks, and poverty reduction strategy papers. 7 This does not
mean that such strategies should necessarily include cultural assets activities. It
does mean that the cultural dimension should be considered in all of our work
and, where cultural assets related activities are deemed appropriate, they should
be mentioned explicitly. This would provide the necessary framework for both
more adequate budget support for future cultural assets operations and a stronger
likelihood that they will reinforce strategic objectives. Without country
6
This operation is noted in the CAS progress report of July 1998 (discussed by the Board in August
1998) as an effort to promote "mutual respect for common cultural heritage [as] an important way to
enhance reconciliation and strengthen the basis for sustainable development."
7
The same rnay also be said for other areas of work such as National Environmental Action Plans and
City Development Strategies.
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department support from early in the project concept stage, cultural interventions
should not be undertaken.
30. Economic, Social, and Institutional Assessment. One consequence of limited
funding has been a lack of resources for analytical work during project preparation. Thus
economic, social, and institutional analysis, as a part of design activities, has tended to be
quite weak. This is made worse by the fact that we have not had resources to carry out
economic and sector work in the cultural field. Consequently it often remains unclear
why certain activities were given priority over other possible activities. This also raises
questions about the sustainability ofthese activities.
31. Lesson: Economic, social, and institutional assessment appropriate to the
planned activity needs to be undertaken as part of project preparation. However,
given resource constraints, judgement will need to be exercised to determine the
appropriate amount and scope of such assessment.
32. Pa.rtnerships. It is Bank policy that cultural assets work should be carried out in
8
close partnership with organizations that have demonstrated expertise in the sector since
the Bank has no plans to recruit staff specialists in these areas. However, in ECA's
experience to date, the development of partnerships with external agencies (and internal
or in-country partnerships) has proven to be quite difficult. Indeed, partnership
arrangements exist formally in only two operations: (i) Bosnia and Herzegovina with
UNESCO, the Aga Khan Trust for Culture and the World Monuments Fund and
(ii) Romania with the World Monuments Fund. While the partnership arrangement has
worked well in Romania, the experience in other countries is that it requires a lot of extra
effort and time (including frustration) on the part of Bank teams and country project
units. Furthennore a number of other conditions - scant financial resources/budgetary
constraints, different mandates and standards of analysis - affecting external partners
may not necessarily be complementary to ECA's agenda.
33. With respect to in-country or project partnerships, the effort here has generally
been to try to facilitate more effective project implementation by nurturing: (i) closer
coordination between concerned ministries and (ii) public-private institutional
arrangements between Government, project entities, local communities, non-
governmental organizations, and sometimes religious groups. The experience thus far is
very uncertain, but it is almost certain to take much more time and effort than envisioned
at the time of project preparation.
34. Lesson: The Bank has neither the skills nor resources to appropriately prepare
cultural assets interventions on its own. Indeed its comparative advantage lies
rather in the ability to link cultural asset interventions to the broader agenda of
socioeconomic development and poverty reduction. It follows that partnership in
the design and implementation of such activities makes good sense. However, we
must keep in mind that partnership bears a cost in terms of the time necessary to
cultivate the relationship and this must be planned for in our ~dministrative
8
E.g., UNESCO, World Monuments Fund, Council of Europe, and the Getty Foundation, among
others.
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budget allocations. Thus partnerships need to be selective and identified to be as
operational as possible.
35. Summary. From the perspective of our preparation of cultural assets activities,
the fundamental lesson that emerges is that of the need for selectivity. Cultural heritage
in its own right is not our comparative advantage. We may support cultural assets
activities when they can be reasonably expected to: (i) have a positive impact on
socioeconomic development, (ii) contribute to attaining the objectives of our country
strategies, and (iii) be adequately conceived and prepared. Under these circumstances we
should selectively seek appropriate operational partners both in country and externally.
The Country Side - Enhancing Effectivelless
36. Client Ownership. Client ownership in our cultural asset operations has been
generally strong, particularly at the national government level. In the cases of Georgia
and Azerbaijan, the respective heads of state took a particular interest in the cultural
operations and continue to provide support, publicly and privately. The Romania loan
was supported enthusiastically by the Ministry of Culture and key members of
parliamentary committees. There have been some exceptions. Thus, while there was,
and is, some suppott at the local level for the St. Petersburg operation, the support of the
national government has been less consistent9. And in the case of Bosnia and
Herzegovina (Mostar bridge reconstruction and conservation of adjacent historic
neighborhoods), local (city) level political and administrative support has sometimes
been intermittent, in part because ofMostar's unusual administrative structure as a city
divided along ethnic lines. Indeed a major objective of the project and other Bank efforts
in Mostar is to start bridging this divide, which hinders economic growth and social
regeneration.
37. Client ownership at the project site level has also been strong when participatory
mechanisms are built into project preparation and implementation. In some cases,
notably Georgia, Romania, and Bosnia, social assessments and stakeholder workshops
have successfully fostered broader public understanding and support/ownership.
However, our weak record on institutional assessment suggests that more could be done
to foster local community ownership.
38. Changes of administration have on occasion had an adverse impact on client
ownership. In Vilnius, Lithuania, enthusiasm for an IDF grant to help provide an action
plan for conservation and restoration of the historic part of the city waned after local and
municipal elections resulted in changed administrations. In Albania, a national strategy
for heritage management failed to materialize under the 1993 IDF grant, partly because of
flagging enthusiasm, or ownership, in the Ministry of Culture.
39. In sum, ownership has been relatively strong at the national level in recipient
countries, reflecting a sense of the importance of paying more attention to culture in
9
The case of St. Petersburg exemplifies the type of institutional complexities resulting from
decentralization, and the ensuing problems stemming from sometimes unclear or overlapping ownership
{national/municipal). In this case the issues were addressed, consensus achieved and consequently work
proceeded.
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development assistance strategies and programs. However, ownership has been
intermittent or weak in some projects at the local and community levels. This is, in part,
a function of the fact that ownership at this level often requires careful and time-
consuming preparation work through stakeholder analysis and social assessments,
something which has often been precluded by the inadequate budgets allocated for
preparation to date.
40. Lesson: Processes to cultivate beneficiary ownership need to be deployed
systematically, both during project preparation and under implementation.
Furthermore, sites should be selected in part as a function of local community
commitment to project activities.
41. Dem onstration of Socioeconomic R eturn . In some cases the requests for
assistance from the Bank for the preservation of cultural patrimony have held mixed
messages from the clients themselves. Ministers of Finance have been reluctant to
borrow for cultural projects, in part because of concerns or skepticism about the financial
and economic returns; moreover, they often have higher investment priorities in more
traditional sectors where returns can more easily be calculated. Ministers of Culture, on
the other hand, argue forcefully for investments to safeguard cultural assets but face a
handicap in making the financiaVeconomic case since assessment methodology in the
sector has not been developed adequately. Clearly, anecdotal evidence suggests that
financial returns from culture investments can be substantialH>. However, the absence of
reliable financial and economic assessment methodology remains an obstacle in
mobilizing greater public support for cultural asset preservation programs, particularly in
resource-constrained transition economies.
42. Lesson: We need a better understanding of the social and economic returns on
investment related to cultural assets at two levels. First, we need a generic
understanding to be able to convince Rolicymakers that it is worthwhile investing
in activities related to cultural assets. 1 And second, as part of project preparation
we need to be able to demonstrate the likely impact of those activities that we
propose to finance. Furthermore, cultural asset activities need to be designed to
foster income generating activities and to have reasonable returns (e.g.,
restoration of monuments without attention to the development of related services
is unlikely to contribute to socioeconomic development).
43. S ustainability. Broadly, sustainability issues in the sector relate to physical
concerns, institutional framework and, above all, financial support. Physical
sustainabi/ity rests largely on maintenance or lack thereof. Throughout the ECA region
there has been a notable lack of maintenance of cultural assets (with some exceptions)
10
In Canada, for example, "governments spend over $ 6 billion per year on culture with the federal
government's share representing only 2 percent of federal spending ... In 1994-95, the cultural sector
contributed over $ 20 billion to the gross domestic product In that same year, there were more than
600,000 people employed in our cultural labor force, a figure that grows by leaps and bounds." Sheila
Copps, Minister of Canadian Culture, from her speech at the September 28-29, 1998 conference on Culture
in Sustainable Development, held at the World Bank in Washington D.C.
11
N.B. The Georgia and Romania cultural heritage projects have set aside funds to test the financial
and economic impact of cultural investments in collaboration with local economic institutes. This should
help develop our understanding of this issue.
-12-
largely because of the public fiscal and financial constraints growing out of the economic
transition and because of other priority claims on scarce resources. Institutional
sustainability concerns the overall stewardship or management of cultural assets.
Traditionally in ECA countries this has been provided mainly by the state, which, given
the structural changes emanating from the transition, is not likely to be able to serve that
role in the future. Religious institutions have also played this role in many countries
since much cultural patrimony in the region is of religious origin or owned by religious
groups. However, religious institutions are also strapped financially, and often lack
management (including conservation) skills, which impinges adversely on institutional
sustainability. Financial support traditionally has been provided through state revenues
since public fee mechanisms are largely undeveloped or non-existent.
44. Although most of the Bank operations make (sometimes heroic) assumptions
about project sustainability, it is still too early to draw defmitive conclusions about
relative success. Two fundamental assumptions seem to be present in most of the
ongoing operations and will require close monitoring during project execution: (i) new
public-private partnerships can be nurtured to complement or even replace existing state-
centered systems for improved management of cultural assets (with an accent on
preventive measures) and thus achieve greater institutional sustainability over time (for
example on the model ofthe UK National Trust); (ii) varied financing mechanisms can
be put in place over time to help achieve greater financial sustainability, such as visitor
fees, special charges associated with cultural tourism, tax incentives for private
investments (i.e. small hotels, museums) associated with cultural sites, and establislunent
of special cultural trusts, among others. Yet the small scale of our cultural assets
operations is unlikely to provide the leverage to make significant changes in the fiscal
treatment of cultural assets.
45. The prevailing climate of resource scarcity in the region raises another concern
related to sustainability. This is the issue of priorities. Which cultural assets are so
clearly aU-important- socially and economically- that they must be saved or conserved?
What criteria should be employed to make this decision and by whom? Most of the Bank
assistance operations (with the exception perhaps ofMostar) seem to be groping for
answers to these questions without any clear blueprint for appropriate decision making.
46. Lesson. Sustainability is a critical issue. Since none of the Bank assistance
operations in ECA are mature enough yet to verify the validity of these
assumptions they make regarding sustainability, monitoring is needed to allow for
corrections as appropriate. Meanwhile, attention to stakeholder participation can
enhance the prospects for sustainability and provide a means for addressing the
issue of prioritization. Furthermore, the issue of public fiscal and fmancial
constraints needs to be brought up at the broader policy level where fiscal change
can actually happen and integrated into our dialogue on fiscal reform.
47. Summary. From the perspective of enhancing effectiveness in country, the
fundamental conclusion is the need for appropriate participatory processes coupled with
an adequate demonstration of expected benefits. This too has a selectivity dimension.
We should only engage in cultural assets activities where such benefits can be
demonstrated and where participatory processes are feasible.
-13-
THEWA Y FORWARD- A STRATEGIC APPROACH
48. Although many ofthe cultural assets in the region are at risk due to Jack of
investments and poor maintenance, they have potential for contributing to socioeconomic
development and poverty reduction in the ECA Region. The question then is what
should the Region do to realize this potential. Of course, the flip side of this question is
that of what we shouldn't do. The following paragraphs will start by laying out a series
of assumptions and constraints. They will then continue by providing a series of
guidelines for intervention in this area.
Assumptions and Constraints
49. In attempting to answer the question of what is to be done, we start with a set of
assumptions and the recognition of certain constraints:
• While conservation of cultural heritage can justifiably be seen as a worthy
objective in its own right, this is not the objective of the World Bank. The
Bank' s comparative advantage with respect to cultural heritage lies at the
nexus of socioeconomic development and cultural assets.
• Indeed, activities revolving around cultural assets possess considerable
potential for contributing to socioeconomic development and environmental
protection. This potential should be explicitly considered in the preparation
of Country Assistance Strategies, Comprehensive Development Frameworks,
Poverty Reduction Strategy Papers, and other analytical work. To this end
the social assessments and participatory processes feeding into these
documents should give attention to cultural elements. This does not mean
that explicit cultural assets interventions are needed or desirable in all
countries. It does mean that the potential for synergies should be sought out.
• The inclusion of cultural assets activities in an assistance strategy is not
enough to make it culturally sensitive, nor to ensure culturally sustainable
development. Cultural sensitivity has less to do with supporting culture for
its own sake, and more to do with making sure projects and programs reflect
the lives and interests of the people they serve.
• Given the current (and anticipated) environment of very scarce Bank
resources, with priority claims for those scarce resources from other
assistance activities, support for cultural assets should be pursued in a
focused, cost effective and selective manner in response to clients' demands,
and in collaboration with more experienced partners in the sector. Our
interventions need to be designed as springboards giving our clients the
incentive and the possibilities to achieve appropriate objectives in the long
term even if further Bank support is not envisaged. We should seek to be
catalyzers, rather than major providers of financial support.
• It follows that our support for cultural assets must be qualit~tively different
from our support to our traditional sectors of intervention. Policy dialogue
-14-
and sustained support will be more feasible to the extent they can be linked
to work and operations done in other sectors (e.g., urban or environment).
• Stand-alone cultural assets projects (financed either through lending or
through grant mechanisms such as the Institutional Development Fund) are
clearly justified under some circumstances. 12 However. there are also other
ways of approaching the mobilization of cultural assets for socioeconomic
development. Components under sectoral projects or programs may well
carry greater potential for mainstrearning concern for culture (for example,
environmental assessment is a very important tool for valuing cultural assets
and encouraging adequate safeguarding). They may also be more feasible
where lending resources are scarce and where limitations on the Bank's
administrative budget rule out stand-alone activities. This is particularly true
in the case of urban development, infrastructure, envirorunent. and
emergency reconstruction projects.
• Including heritage conservation as an element of a larger project risks
creating projects in which the heritage component is not integral to the
overall project design (which suggests it may get short shrift) or that are
overly complex (e.g., through the involvement of multiple ministries). The
Bank's experience with such projects suggests several lessons for dealing
with this risk. First, taking into account heritage assets and opportunities at
an early stage in project design usually leads to the best results. Second,
institutional coordination issues are paramount and if not addressed early on,
can cause delays and obstacles. And third, adequate analysis of causes of
deterioration, community interest (by means of social assessment), and reuse
options leads to better outcomes.
• At the same time, there is significant potential for the Bank to play a catalytic
role in promoting the integration of cultural assets activities into other
socioeconomic development activities without necessarily lending for such
activities, for example in regional seas programs or NEAPs. In other words,
as a "'knowledge bank", we can have an impact in promoting such linkages.
However, it must be recognized that such activities bear costs, just as do
project preparation and supervision, that need to be budgeted.
Guidelines and Recommendations for Intervention
50. In light of the constraints discussed above, and with a view to promoting a more
coherent approach to cultural heritage in the ECA Region, this paper proposes the
following set of guidelines and recommendations. In so doing we return briefly to the
broader issue of cultural sensibility, which is more thoroughly addressed in the Regional
Social Development Strategy.
If consistent with the CAS objectives., specifically requested by the client, and designed in such a
manner as to help reduce or alleviate poverty through strong connnunity-based support.
-15-
Cultural Sensitivity
• Culture is inextricably part of any comprehensive and sustainable
development effort. Therefore, attention to culture needs to be
mainstreamed into the preparation and substance of country assistance
strategies, comprehensive development frameworks, and poverty
reduction strategies. This does not mean that cultural assets activities
should necessarily be included in our lending programs. Rather, it means
(i) that sociocultural analyses should be brought into the substance of the
strategy and program and (ii) that the potential for mobilizing cultural assets
in the promotion of development and poverty reduction should be considered.
This can best be achieved through explicit consideration in the design of the
social assessment and participatory processes that feed into the preparation of
these strategy documents. To ensure that this is not overlooked, the social
reviews carried out by ECA' s social team will specifically look for evidence
that culture has been appropriately addressed.
• In addition, the Bank's work and the programs and projects we support
need to be designed to be culturally sensitive. To this end appropriate
social assessment should be built into all project preparation. This is already
subject to systematic review by ECA's social team.
• Furthermore, as with all social safeguard policies, the policy on cultural
property (OP 4.11) must be scrupulously respected. This is a "do no
harm" policy which calls for the Bank to decline to finance projects which
will significantly damage cultural property and to actively assist in the
protection and enhancement of cultural properties encountered in Bank-
financed projects.
• The cultural sensitivity of ECA staff should also be strengthened. To this
end staff should be encouraged to become knowledgeable about the history,
politics, and cultural development of the countries in which they work.
Gaining such knowledge is a legitimate use of our training budgets.
Mobilization of Cultural Assets
• Cultural assets interventions must focus on the area of our comparative
advantage - the nexus between socioeconomic development and cultural
assets. Bank-rmanced activities revolving around cultural assets should
substantially contribute to socioeconomic development and poverty
reduction.
• Areas that have particular potential for creating synergies between
socioeconomic development and cultural assets include (but are not
necessarily limited to): community-based eco-cultural tourism; crafts
development; renewal of historic urban centers; and environmental
preservation.
-16-
• When stand-alone cultur al assets projects are considered, special attention
is needed to ensure that they are consistent with CAS objectives, specifically
requested by the client, and designed in such a manner as to help reduce or
alleviate poverty through strong community-based support. In particular, we
need to ensure at a very early stage that there is strong ownership from the
government.
• Cultural assets components of broader projects should respond to the ·
same criteria. In addition, they need to be designed in such a manner that
they do not render the project overly complex or create unsustainable
supervision burdens. Adequate funding for project preparation and
supervision needs to be assured.
• For all cultural assets activities, it will be necessary to determine the
minimum package of institution building components needed to ensure
sustainability. This would include attention inter-alia to: overall
administrative systems and staff recruitment; interagency coordination;
project management skills; strategic planning; financing and budgeting; and
identification of training needs. In other words, there is a need to identify
critical institutional bottlenecks that are amenable to the scale of intervention
feasible in our cultural assets activities. This should be a key function of
institutional analysis as part of project preparation.
• Increased quality control on cultural assistance efforts should be
exercised at the earliest concept stage. Three measures are envisaged to
assure quality: First, it is expected that the initial PCDs (or equivalent
documents) should reflect the above guidelines and focus particularly on
(i) strategies to achieve fmancial sustainability through income-generating
activities related to tourism, crafts development, small-scale enterprise
development, etc.; (ii) realistic partnership arrangements; and (iii) realistic
project preparation programs and Bank budget support. Second, members of
the Regional cultural heritage steering group should be invited to comment
on such documents. And third, these guidelines will be reflected in the social
reviews carried out by ECA's social team.
Annex I
Page 1 of 1
MATRIX OF ASSISTANCE OPERATIONS IN THE ECA R EGION- JUNE 2000.
Country Project Bank/IDA FY Managing Status TIL Activities
Amount (approval) Unit
ALBANIA Albania Butrint $225,000 2000 ECSSD Launching
implementation
Adriana Damianova
Ext. 32159
tHtO t~t g
National Park
Management (IDF)
ARMENIA
AZERBAIJAN
Cultural Heritage
Initiative (IDF)
Cultural Heritage
Support (LIL)
$371,000
$7.5 mil.
(IDA)
2000
1999
ECSSD
ECSSD
Launching
implementation
Launching
Implementation
Mark Woodward
Ext. 38112
Mark Woodward
Ext. 38112
tttt
~
,.
o m,.
BOSNIA Mostar Bridge Project
(LIL)
$4 mil.
{IDA)
1999 ECSPE Implementation Lawrence Hannah
Ext. 33623 t!lls ill& ~
CROATIA Kastela Bay
Conservation
$12 mil. ECSJN Preparation MahaArmaly
Ext. 37057
ttit 6 Pit ,
t!.!!.1 Pil6 ~
GEORGIA Cultural Heritage $4.5 mil. 1998 ECSHD Implementation Eric Peterson
(LIL) (IDA) Ext. 36911
KAZAKHSTAN Silk Road Development
Project (IDF)
$450,000 ECSSD Preparation Thomas Blinkhom
Ext. 80282
,. lil ttft
MACEDONIA Community
Development & Culture
$5 mil. ECSSD Preparation Emilila Battaglini!
Mark Woodward
tttt a ,. ~
Project Ext. 33232/381 12
t!.!!.1 ~ () ~
ROMANIA CUltural Heritage $5 mil. 1999 ECSSD Implementation Thomas Blinkhom
Project (LIL) Ext. 80282
6 ~
RUSSIA St. Petersburg Urban 1998 ECSIN Implementation Felix A. Jakob
Rehabilitation Project Development Ext. 37073
Project with $1
TURKEY Turkey Cultural
Heritage Project
mil. allocation to
cultural activities
$10 mil. ECSIN Preparation Eric Peterson
Ext. 3691 1 O ~ t!!!3
,.
ARMENIA/
AZERBAIJAN/
Trans-Caucasus
Tourism Initiative
$500,000 ECSSD Preparation Mark Woodward
Ext. 38112
tttt ~ ~
GEORGIA
Legends: ~ Munttllh.lit~. I1Ji Crban Devdupment ttft Community Development 0 Planning/Poticymaking
!il Tourism ~ Institutional Strengthening ~ Other
• Additional very limited funds from DGF have been made available for Albania (radio station) and Ukraine-Crimea (community based tourism).
Annex II
Page 1 of2
SUMMARY OF THE FRAMEWORK AND LENDING CRITERIA FOUND I N
CULTURE AND SUSTAINABLE D EVELOPMENT:
A FRAMEWORK FOR ACTION
A Framework for Support
Because culture underlies development and development work, mainstreami11g attention to
culture into Country Assistance Strategies (CASs), sector strategies, projects, economic and
sector work will increase the Bank's effectiveness. This is especially true in education, health,
targeted poverty programs, and urban and rural development.
Building on the cultures ofpoor and margi11alized groups is part of the World Bank's poverty
agenda. . Within that framework, the World Bank has begun to develop strategies to support
social inclusion and strengthen locally relevant institutions for development purposes. This
includes helping poor groups to create employment and income opportunities on the basis of
their traditions. The World Bank also supports cultural activities in countries concerned about
the cultural survival of poor and marginalized groups, to assist in strengthening the social
cohesion, identity, and capacity of these groups. While such projects are heavily culture-
oriented, they explicitly support the World Bank's development goals of social inclusion and
poverty reduction.
When the World Bank supports conservation ofmonuments and heritage sites it is to achieve
economic and social objectives. Most World Bank projects that include site conservation are
justified on tourism grounds. However, it must be kept in mind that tourism can itself degrade
the environment and culture. A key issue in World Bank support for site conservation linked to
tourism will be to determine how the World Bank Group, including the International Finance
Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA), can work with
governments, the private sector, and nongovernmental organizations to stimulate and regulate
tourism development in such a way as to prevent deterioration of the natural environment, sites,
and community life, while enhancing local employment and revenues.
Lending Criteria
Although all the World Bank's work needs to be culturally sensitive, Bank support for cultural
projects as such will depend on their impact and on whether the Bank has a comparative
advantage. Financing culture-based activities is justified when it responds to needs expressed by
client governments and supports CAS diagnoses and priorities. In particular, it is justified when
it:
• reinforces sectoral or project objectives; or core development activities;
• reduces poverty and stimulates enterprise development by the poor;
• contributes to poor groups' social capital and capacity, or
• leverages private direct investment that generates local employment benefiting the poor,
yields tax revenues, and contributes to environmental and cultural conservation.
In any case, the Bank should be involved only when it can add value to the assistance of others
by integrating the work of specialized organizations into the social and economic development
context. The World Bank does not finance culture-based activities when there is no
Annex IT
Page 2 of2
demonstrable socioeconomic benefit consistent with the Bank's development mandate, when
alternative financing is or could be available, or when the activity contravenes the CAS or is not
in response to effective client demand.
Overall, the World Bank•s work in this arena should be pluralistic and should not seek to
promote one culture or another. The program's success will depend on the World Bank's ability
to leverage not only its own capacities but also the skills of expert organizations and the insights
of grass-roots organizations to produce significant, sustained social and economic impacts
Source: The World Bank, Environmentally and Socially Sustainable Development (1999).
Culture and Sustainable Development: A Frameworkfor Action
Annex III
Page I of2
COST BENEFIT ANALYSIS: PRINCIPLES AND METHODS • l ,,_
' .·{ ..
The text presented here is adapted from Stefano Pagiola (June 1996), Economic Analysis of
Investments in Cultural Heritage: Insights from Environmental Economics, Envirorunent
Department, World Bani<.
When we ask what the value of a cultural heritage site is, we are generally asking one of two
related but different questions. First, we might be asking what the value of the entire site is, as
an asset. Implicitly, we are asking how much worse off we would be if the site vanished
tomorrow. This is the question we would ask if we were primarily interested in estimating our
·wealth', of which cultural heritage is one component. Second, we might be asking what are the
benefits or costs of actions that change the cultural heritage site in specified ways. This is the
question we would ask if we were considering undertaking a project which would improve (or
which might damage) the site. In this context, the key issue is not the overall value of the site
but the change in that value resulting from the project. While both questions are interesting and
important, the second is more directly relevant to the evaluation of projects such as the World
Bank might undertake.
Types of Values. Cultural heritage projects will have a wide range of effects. Some of these
will be directly related to the cultural heritage dimension of the site, others will not, while yet
others will be a mix of both. In similar circumstances, envirorunental economists generally take
a comprehensive look at value, using the concept of total economic value. Total economic value
is usually decomposed into use value and non-use value. Use value derives from the services,
such a tourism, which a site provides. Non-use value derives from the benefits that a site may
provide which do not involve using the site in any way, such as the knowledge of its existence.
Types of Impacts. In addition to use and non-use value, cultural heritage projects are also likely to
have impacts that may be only indirectly related to the cultural heritage nature of a site. For
example, improving roads will make access for residents and visitors to a site easier, but is unlikely
to either enhance or detract from cultural heritage per se. The benefits (or costs) of these indirect
impacts should definitely be considered in the economic analysis of cultural heritage projects and
standard techniques can be used to evaluate them.
Who Benefits. It is very important to establish which groups would be affected by the projec~ and
in what ways. At a minimum, the analysis generally needs to distinguish three groups:
(a) Residents. Since residents live on the site, they are able to benefit from any use value year-
round. They may also experience increased incomes from tourist spending at the site. (b) Visitors.
Since they visit the site, visitors also receive use benefits, although not necessarily the same ones as
residents. (c) Others. To the extent that they might visit the site, they have option value on its
continued existence. To the extent that they do not, they only have existence value. A finer
breakdown is often useful. It may be useful to distinguish poor from rich residents, for example, or
residents working at the site from those working elsewhere.
Methods. The analyst should have a list of expected project impacts, classified according to the
type of value they are likely to affect and the beneficiary group. Many different methods can be
used evaluate the benefits provided by a project. These include market-based methods and non-
market-based methods. Market based methods require infonnation on actual transactions. An
Annex III
Page 2 of2
example is when visitors pay a fee to enter the site. The revenue generated from such fees provides
a direct measure of the value people place on being able to visit the site. Cultural heritage sites
might also induce a variety of economic activities, again most obviously in the tourism industry
(hotels, restaurants, shops). Standard techniques can be used to value these benefits. The difficulty
generally arises in predicting the impact that changes in the cultural heritage site will have on the
quantity of such services, not in estimating their value. Non-market methods include travel cost
method, contingent valuation, hedonic methods, and benefits transfer. These methods can be
controversial and expensive, and should only be undertaken when necessary.
The process of evaluating the benefits ofthe project then begins by estimating the value of the
benefits that are easiest to measure-usually various kinds of extractive use values, or any benefit
that is·measured primarily with market-based techniques. If these benefits alone are sufficient to
justify the project costs (according to some agreed criteria for what constitutes 'sufficient'), then the
analysis can stop. There would be little point in spending further effort to measure things that are
difficult to measure, since the decision to undertake the project would not change. Any additional
benefits are noted qualitatively, but not measured. If the benefits that are easy to measure are
insufficient to justify the project by themselves, then efforts are made to measure the next-hardest
category of value-usually various kinds of non-extractive use values. Again, the process stops as
soon as sufficient benefits are found to justify the project. Ifall categories of benefits have been
measured as well as p6ssible and the project is still not justified, then the project is abandoned or
modified so as to be cheaper or more effective.
ECSSD Working Paper #15: Belarus: Agricultural Policy Update -June 28, 1999
ECSSD Working Paper #16: Lithuania: Adjustments of Agricultural and Trade Policies -
June 28, 1999
ECSSD Working Paper #17: Armenia's Private Agriculture: 1998 Survey of Family Farms
- September 1, 1999
ECSSD Working Paper #18: Romania: Forestry Sector: Status, Values, and the Need for
Reform -October 10, 1999
ECSSD Working Paper #19: Kosovo: Relaunching the Rural Economy- November 5,
1999
ECSSD Working Paper #20: Ukraine: Privatization and Corporate Governance in the
Agroprocessing Sector- Status and Critical Constraints in 1998 - December 1, 1999
ECSSD Working Paper #21: The Slovak Republic: Grain Market Policy and Accession to
the Europe'<l:n Union -January 3, 2000
ECSSD Working Paper #22: Kosovo: Damage Assessment in Agriculture - May 5, 2000
ECSSD Working Paper #23: Structural Change in the Farming Sectors in Central and
Eastern Europe: Lessons for EU Accession- Second World Bank/FAO Workshop July
27-29, 1999 - Country Case Studies - March 20, 2000
E CSSD Working Paper #24: The Agrarian Economies of Central- Eastern Europe and
the Commonwealth of Independent States: An Update on Status and Progress- June 3,
2000
ECSSD Working Paper #25: A Review of the Grain Marketing Sector in Kazakhstan and
Ukraine: Constraints Confronting the Future Development of the Sector - June 29,2000
ECSSD Working Paper #26: Georgia: A Update of Agricultural Developments - July 31,
2000
ECSSD Working Paper #27: Farm Debt in the CIS: A Multi-Country Study of Major
Causes and Proposed Solutions- Moldova Country Study - September 19, 2000
ECSSD Working Paper #28: Farm Debt in the CIS: A Multi-Country Study of Major
Causes and Proposed Solutions - Ukraine Country Study - September 26, 2000
ECSSD Working Paper #29: Cultural Assets in Support of Transition in the Europe and
Central Asia Region: An Operational Perspective - January 17, 2001
Other Working Papers in this Series
This paper is the twenty~eighth in a series of papers published by the ECA Environmentally
and Socially Sustainable Development Unit. For additional infonnation on this, or forthcoming
papers in the series, please contact Mr. David Bonte1npo at (202) 473-5591.
ECSSD Working Paper #1: Agricultural Reforms and Protection of Sensitive Ecosystems:
A Challenging Agenda for Slovenia - April2, 1998
ECSSD Working Paper #2: Agricultural Research in Central and Eastern Europe and the
Fonner Soviet Union: Issues in Transition- April2, 1998
ECSSD Working Paper #3: Irrigation Development in Eastern Europe and the Former
Soviet Union- June 8, 1998
ECSSD Working Paper #4: Estimating Industrial Pollution in Latvia- July 28, 1998
ECSSD Working Paper #5: The Estonian Rural Sector: The Challenge in Preparing for
EU Accession-August 10,1998
ECSSD Working Paper #6: Rural Development in Eastern Europe and Central Asia:
Progress to Date and Strategic Directions for ECA -August 17, 1998
ECSSD Working Paper #7: Agricultural Price Policy Impacts in Poland - October 20.
1998
ECSSD Working Paper #8: Northern Poland Regional Development: Review of Initial
Results and Participatory Process- January 15, 1999
ECSSD Working Paper #9: Hungary: A Successful Agriculture and Food Economy in
Constant Search For Higher Competitiveness - January 15, 1999
ECSSD Working Paper #10: Agricultural Higher Education in Transfonning Central and
Eastern Europe- January 27, 1999
ECSSD Working Paper #11: A Guide to Competitive Research Grant Schemes for
Agriculture in ECA Countries- February 11, 1999
ECSSD Working Paper #12: Older People in Transition Economies: An Overview of their
Plight- April21, 1999
ECSSD Working Paper #13: The Agrarian Economies of Central and Eastern Europe and
the Commonwealth of Independent States - April 26, 1999
ECSSD Working Paper #14: Poland: Complying with EU Environmental Legislation -
June 10,1999