NlIMBER 130 OLD Preciss Operations Evaluation Department December 1996 Environmental Assessments and National Action Plans Since the late 1980s, the World Bank many environmnental action plans and sustainable development. The has made important strides in helping competing for government attention Bank, which had been helping bor- borrozwers integrate environmental as- and scarce resources, and some coun- rowers prepare national environ- sessments (EAs) and national environ- tries seem to perceive them more as a mental strategies since the late mental action plans (NEAPs) in their Bank requiremen t for access to addi- 1980s, responded by issuing in 1992 project and strategic planning. EAs are tional lending than as a strategic Operational Directive 4.02, which n1ow firmly rooted as part of the Bank's planning tool. introduced policy and procedures normal business activity. for NEAPs. Environmental action Background plans are intended to be demand- And many international organiza- driven, participatory, and result in tions have adopted them as models for The Bank first outlined its policies a time-bound plan of action to help their oZVtw environmenztal assessments. and procedures for EAs in Opera- countries integrate environmental Two recent World Bank studies, one a tional Directive 4.00, Annex A, is- concerns in their overall develop- self-evaluation based on a desk review sued in 1989. The directive describes ment strategies. NEAPs are re- by the Envirotnment Departmetnt (ENV) EA as a flexible procedure whose quired of all IDA borrowers and and the other an independent field-based depth and breadth depend on the suggested for IBRD clients. To- study by the Operations Evaluation De- type of project being planned. Not- gether, EAs and NEAPs are ex- partment (OED), arrive at similar find- ing that EAs are the responsibility pected to strengthen borrowers' ings and recommendations. of the borrower, the updated direc- tive (Operational Directive 4.01, The studies agree that the quality issued in 1991) identifies three cat- Etfrectioenes. of Environmental and effectiveness of EAs have improved egories of projects, each with differ- Assessnientj andl National Enzn- significantly over the past five years. ent requirements for environmental ronenteal.4chton PlLns: .4 Proc;es; Identification and assessments of envi- impact assessment: Category A, Studit,. bi/ .Air,a Kreoner and otli- ronmetztal impacts have especially im- requiring full EA; Category B, re- ers. O)ED. Report No 15835. IJune proved, as has planning for mitigation, quiring environmental analysis; 1996. and Thet hnpact of Enl; iro n- monitoring, and management. Despite and Category C, requiring neither mental A_ssles'sment - Second En- the achievements, challenges remain. In EA nor environmental analysis. Vi. oninental Asse.iSment Review of particular, public consultation and Between 1989 and 1995, the Bank PioleIts Financed bu the LVorld analysis of project alternatives need to screened more than 1,000 projects Batn1k ili 1992-liimle 1995. biV be strenigthened as does supervision of for their potential environmental Olnz Klrorven and othlicu, EnvirOnl- agreed action plamis. impacts, including 99 approved ment Depaitmnent- .A st 1996. Category A and 415 Category B Tile OED stud-i is available to NEAPs, wheni pursued through local projects. These assessments span all Bank e' tit Ul' i,trectot s and staft participation, have encouraged comisen- sectors, almost all borrowing coun- fromin the Internal Documents Llnlit sUs on1 environnmental issues and have tries, and a wide array of projects. Mid pot.n Re.io;al lnthlmation strengthened environmental maniage- Centers. The ENV st-id'J Is 1avail- ment. Nevertheless, OED's evaluation The 1992 Rio Earth Summit able t1hrou.,1h the Balnk's Public In- of the effecticn tmss of the action plaIs called on all countries to prepare formnatiuon Centtl. PriciiS written t'u showed that NEAPs have yet to achieve national environmental action plans F,7rah Ebralumiiniand Roiiald Parker. their fill potential. They are arnong to accelerate environmentally sound capacities in environmental man- tially significant environmental im- analysis, which may still be weak in agement. Since the late 1980s, more pacts. Increasingly, other multilat- implementing agencies and among than 90 countries have started the eral financial institutions were us- EA teams. NEAP process; about 74 national ing Bank-developed EAs to evalu- plans have been completed. ate development projects. The ENV While agreeing with these assess- review attributed these achieve- ments, the OED study highlighted In mid-1996, the Environment ments to more EA training, both timeliness of EAs as particularly im- Department and OED completed within the Bank and in borrower portant for EA effectiveness. The separate evaluations of the effec- institutions, improved guidance, study found that many EAs focused tiveness and impact of EAs on and most important, increasing EA on comprehensiveness rather than Bank-supported projects and bor- experience in the field, marked by on timely identification of major rowers' strategic planning. While improved quality of local consult- risks. Part of this problem stemmed the former study was based on a ants. Despite the achievements, the from the Bank's terms of reference detailed desk analysis of EAs across studies noted areas for improve- for EAs, which required predictions all sectors and regions, including ment. These are summarized below. and evaluation of multiple impacts, in-depth interviews with staff sometimes without focusing on the involved in the EA process, the Fututre challenges most important ones. Although the latter study assessed both EAs and process produced volumes of mate- NEAPs, combining desk reviews, Project preparation and design. The rial at considerable cost to the bor- field case studies of eight countries, ENV study identified public consul- rower, some assessments appeared and surveys. In addition, the Envi- tation and analysis of alternatives to have come too late to significantly ronment Department completed a as particularly demanding aspects alter project location, size, or other desk stocktaking and best practice of EA work. It noted that these ef- major design decisions. The OED review of NEAPs in 1995. (See box forts frequently require special study found that in only 9 of the 53 on the methodology of the studies). skills or prior experience. But in projects reviewed were those pa- many developing countries public rameters modified as a result of EA Environmental assessments consultation is still an evolving findings. And only in China and Po- practice, and local consultants may land among the eight countries vis- Achievements to date not be fully familiar with the pro- ited did the majority of respondents cess. Moreover, analysis of alterna- consider EAs to have influenced Both studies noted significant im- tives requires skills in economic project design. provements since the Environment Department's first review in 1992. In that study, ENV found that envi- Box: Methodologies of the studies ronmental assessments had yet to The OED study denved its findings emergency recovery, and environ- be fully integrated in either the Benk's fl inte ratedith the n- from eight country case studies pre- mental management. Bank's or borrowers' in pared or the asessment, including ning for two reasons: borrowing field visits to each country an The Environment Department's country institutions were too weak analyvsis of 53 projects, a literature Saecopid Et ;'irLoiumeu lltal .4sssu-nSitL'?t Rc- and the Bank's knowledge and re- review, and three commissioned 'iiu' vwas a deesk rev ie, cocering all sources still too limited to help papers prepared by independent Category A and selected Categor B countries prepare assessments and environmental e\?prerts. In addition, projects appro% ed1 between July 19y92 implement projects according to the ev aluation team conducted a and June IQQ5. The stuLdy reviewed their provisions. But by the ENV's mini-survey of Bank and borrower prolect documents such as environ- second review in 1995, important staff t(including 70 inter-views and mental data sheets, EA reports and progress had been made-progress several focIuS groupsi to determine summaries, statf aappraisal reports readily acknowledged by the OED their views on the effectiveness and project legal documents anti supervi- study as well. impact ot ELA and NEAPs. The sion reports. and other papers locu>- countries selected. Boliv ia. China ing on ;Pecitic aspects ot EA wxork. Both OED and ENV noted that Madagascar, Mlauritiis. Morocco, In addition, task managers. env iron- EA directives, among the most com- the Philippines. Poland. and Uru- mental specialists, and regional prehensive in the world, were being guay, provided a representative environmental divisions prov-ided followed. The EA process had be- sample of region- and- of the difter- essential intormation through dbs- ences between countries tha t had cu,sions and inten iew-s. Similarlx come institutionalized within the an approved N EAP anrd thot,e that the Environment Department carried Bank as part of the project cycle and did not. The 53 prolects illustrated out a separate stocktaking .rnd best accepted by the borrower as an im- current practice acrnss a range of practice rev iew ot more than 311 portant part of project preparation. sectors, including agricultutre. en- NEAPs entitled Natidail 5tl.cg>les: Assessment reports, including miti- ergy, power, transport, urban. in- Lea' min'r Froin, Expc'lti&c. published gation plans, were being routinely dustry, water and sanitation, in 1945 prepared for projects with poten- December 1996 Two caveats are important, how- Supervision. The ENV study noted While there is diversity among strat- ever: (1) EAs are often focused more that for Category A projects, which egies, there is also much overlap. In on mitigatory measures than on require full environmental assess- such an environment, making Bank changes in design or location, be- ments, implementation generally lending conditional on completion cause the latter are often appropri- seemed to progress better on envi- of a NEAP can seriously erode own- ately selected prior to or during ronmental than on some of the other ership of the exercise, including sup- preparation of EAs. And (2) most project-related areas, suggesting port from NGOs. Moreover, differ- projects whose design and location that EAs might be playing a positive ent countries are at different stages were influenced by EAs were Cat- role in project supervision. Never- of environmental preparedness and egory A projects, whereas most of theless, the study noted that even in subjecting them all to the same those considered in the OED Category A projects, Bank supervi- NEAP process overlooks these dif- study were Category B projects, sion is not always sufficient to de- ferences. For extremely large and reflecting their actual representa- tect and address environment- diverse countries, such as China and tion in the portfolio. (For Category B related problems as projects evolve. India, preparing a national-level en- projects, design change is normally The OED study agreed, noting that vironmental strategy can prove par- not necessary since impacts are the evaluation teams' site visits ticularly unwieldy. generally limited.) showed that EA provisions often were not well integrated into imple- Second, many NEAPs appeared to The ENV study found that mentation. Both studies agreed that be one-time efforts that ended with a sectoral EAs and EAs with careful EA results and recommendations document; few countries have thus analysis of alternatives often had need to be more adequately re- far succeeded in establishing an on- the greatest impact on project de- flected in legal documents, bidding, going, self-sustaining strategic envi- sign, while project-level EAs influ- and contract documents to improve ronmental planning process at the enced design principally through the effectiveness of EA during national level. To keep NEAP imple- mitigation, monitoring, and man- implementation. mentation on track requires consid- agement plans. Timeliness of EA erable environmental management findings becomes less of a problem National environmental action plans and consultancy capacity, which when EAs are moved upstream and most developing countries still lack. conducted at sector and regional Achievements to date Paradoxically, in some cases, NEAPs levels rather than at the project forced the use of international con- level. Indeed, such EAs-which OED found that the benefits of sultants, thus failing to strengthen even in industrialized countries are NEAPs increased with local owner- local capacity. Finally, there has still rare-are proving to be effective ship of the process. Moreover, both been insufficient coordination be- instruments in addressing environ- ownership and positive impacts in- tween Bank teams working on mental issues early, before project creased when there was participa- NEAPs and those working on coun- decisions are made. tion of nongovernmental organiza- try assistance strategies. Often the tions (NGOs) and coordination with latter have not adequately incorpo- Project classification. The ENV re- other international organizations. rated recommended NEAP actions. view found greater consistency be- In the best cases, NEAPs helped tween operations and environment create a forum for debate and Recommendations staff in screening projects than it stronger environmental manage- had in 1992. Nevertheless, it noted ment institutions, introduce envi- The Bank and its borrowers are that sometimes the need to classify ronmental protection policies, beginning to accumulate significant projects drew attention away from prepare innovative pilot projects, experience in environmental man- the actual environmental issues as- and increase public awareness of agement. The Bank needs to maxi- sociated with the proposed project. environmental issues. mize and disseminate what it is OED agreed that screening by cat- learning while fostering borrower egories had improved, but noted Future challeniges ownership of environmental objec- screening was still not uniform tives. Specifically, it has an obliga- across the Bank. Projects with simi- Nevertheless, in most cases, the tion to make its environmental lar environmental impacts were NEAP process was less than fully processes as efficient and effective as sometimes placed in different EA effective for several reasons. First, possible, and it needs to be more at- categories across regions. Moreover, NEAPs are among many strategy tentive to client needs. Among the not every project type lent itself to options competing for the attention recommendations of the two studies: the three-tier classification system. of borrowing governments. Since That may explain why discussions 1985, many international develop- * Move the EA process upstream. Im- on classification were sometimes ment agencies have sponsored na- proving the timeliness and hence the not brought to closure (six of the tional environmental strategies, and impact of EAs on project design re- projects reviewed had not yet been in some countries one or more of quires pushing the process further assigned a category). these plans are already established. upstream. That can be done through OED Precis greater use of sectoral and regional recognition of the connection be- ments and in broader measures of de- EA assessments. These broader stra- tween environmental degradation velopment progress, including adjust- tegic EAs allow environmental con- and chronic poverty. ment of the national accounts. siderations to be integrated in sector decisions from the outset, before Actions are underway to The Committee on Development project decisions are made. strengthen the effectiveness of Effectiveness welcomed the conclu- EAs, including improved guidance sioIn of the two studies that the Bank * FocUs on key issuies and better analy- in key areas such as strategic EAs, has made progress in improving the sis of design. Terms of reference need health impact assessment, analysis EA process in client countries and to focus on key impacts. Local envi- of alternatives, and environmental that it has emerged as a leader in this ronmental agencies should be pro- monitoring. These are areas where area. The committee noted that both vided with technical support and the Bank is on the "cutting edge" in studies had identified supervision of resources to take on year-round terms of advancing EA as an envi- the EA process as an area in need of monitoring for EA preparation. ronmental management tool in de- improvement and encouraged man- veloping countries. agement to continue its efforts to * Improve the EA process downstream strengthen supervision. Similarly, it by formalizinzg mitigation measures and Bank management, in its response agreed thzat a key plurpose of EA work strengtheninzg supervision. As much as to the OED process review, agreed with was to assess investment alternatives, possible, environmental mitigation the conclutsions of the study on EAs. a difficult issue requiring more atten- measures identified by EAs should It noted that the Bank is issuing clear tion. The committee believed that be summarized in language appro- guidance on moving the EA process up- management needed to make its objec- priate for legal agreements and in- stream through greater use of regional tives clearer with regard to capacity cluded in tender documents and and sectoral EAs and better analysis of building for EAs and NEAPs, and it contracts. Action plans should be alternatives. It added thzat the Bank is needed to set benchmarks for achiev- consistent with local capacity to increasing training of Bank and bor- ing them. With regard to OED's implement them in the field. And rower staff in the EA process and will finding that EAs were often com- borrower field staff should be continue to provide EA regulatory ad- pleted too late in the project cycle, the trained in supervision of environ- vice to borrowers. It is issuing guidance committee noted management's asser- mental management plans. EA to simplify reports and to make them tion that significant efforts were unl- directives and other relevant docu- more accessible to borrower staff and derway to integrate EA with economic, ments should be made available in consultants. Implementation of the rec- financial, institutionial, and engineer- local languages, accompanied by ommendations will be assessed in the ing analyses early in project brief manuals and checklists to en- Third Review of EAs planned for 1998. preparation and to increase the use able borrower staff to better under- of sectoral and regional EAs as ap- stand the lengthy EAs. To ensure With regard to NEAPs, management propriate. The committee welcomed adequate supervision, environmen- noted that Bank-supported environmen- maniagemnenit's commitment to tal audits should be conducted both tal action plans have had significant, strengthening the link between EAs during and after implementation. positive effects in several countries in and country assistance strategies, helping governments identify and pri- adding that the Bank was working to * Tailor the NEAP process and re- oritize environmnental challenges, raise incorporate environmental concerns quiremtienits to counltry circumstanices. awareness of environimental issues, and into macroeconomic and sectoral There should be more flexibility in identify zvays to address them. It agreed analysis and working on"greening" Bank requirements concerning with OED that the design of NEAPs of National Accounts. NEAPs and increased Bank support should be adapted more to the needs, of strategies supported by other do- capacity, and planning horizons of cli- The committee urged more coop- nors and international NGOs. In ents and that the environmental priori- eration among the Bank, IFC, and particular, the Bank should better ties identified in NEAPs should be MIGA to ensure that policies and coordinate the NEAP process with better reflected in counltry assistance practices with regard to environment those of other donors to minimize strategies and economic and sector were coordinated. Finally, the com- duplication of effort. zvork, adding that it is taking steps to mittee remarked that government address each of these issues. It noted ozwnership of NEAPs zvas zveak, * Integrate environmnenztal priorities thlat the Bank will continiue its work on) noting that in most cases the action identified in the NEAPs in the design of environimental indicators and incorpo- plans zvere developed only because counltry assistance strategies. Improve rate them more fully in strategy docu- IDA required them for funding. OED Precis is produced by the Operations Evaluation Department of the World Bank to help disseminate recent evaluation findings to development professionals within and outside the World Bank. The views here are those of the Operations Evaluation staff and should not be attributed to the World Bank or its affiliated organizations. This and other OED publications can be found on the Internet, at http:// www.worldbank.org/html/oed. Please address comments and enquiries to the managing editor, Rachel Weaving, tel: 1-202/473-1719, fax: 1-202/522-3200, e-mail: rweaving@worldbank.org December 1996