World Bank Drops Plan For Tibet

Facing opposition from Tibet activists and environmental groups over a proposed relocation plan for farmers in China, the World Bank announced Friday that China would pay for the program itself.

That decision came after bank directors failed to agree on whether to go forward with the controversial Qinghai component of the China Western Poverty Reduction project—a program to move thousands of farmers from an impoverished area of Qinghai to another area within the province that some consider traditional Tibetan land.

"We accept the decision by the Chinese Government," said World Bank James D. Wolfensohn in a statement. "We note that the project will be implemented by them. We look forward to a continuation of our long-standing relationship with China in the context of other projects."

The board of directors was supposed to review an independent review of the plan—one of the most controversial initiatives in the Bank's history—and announce a decision on Thursday, but postponed it until Friday morning.

According to a World Bank statement Friday, "the majority of the Executive Directors did not agree to adopt management's recommendations" to go forward with the program.

Opponents of the plan set up a protest camp outside the lending institution's Washington headquarters this week.

The Qinghai component, a $40 million segment of a $311 million World Bank assistance project, would relocate 58,000 people from Haidong Prefecture to Dulan County, 300 miles west and within a traditionally Tibetan area inside Qinghai province.

Some of the $40 million would be used to assist families staying in Haidong.

Pro-Tibet and environmental groups had attacked the plan for over a year.

"The China Western Poverty Reduction Project will exacerbate Chinese demographic influx, the most serious threat facing Tibet today," argues the environmental group Friends of the Earth.

Plus, the plan to relocate an entire farming community to a new area "will create a substantial risk of erosion in the region, whose soil is extremely saline and may negatively affect groundwater supply," the group says.

China annexed Tibet in 1951.

The World Bank had argued that the project "would increase incomes and productivity in both farming and off-farm activities" and would involve "significant improvements in health and education services, safe water supply, electricity connections and the quality of local roads to market."

"The farmers on the hillsides of eastern Qinghai are among the poorest people in the world," the Bank said.

Still, the World Bank admits that it "simply did not anticipate the extent of reaction from Tibetan groups and other non-governmenta organizations."

Last June, the International Campaign for Tibet asked for a World Bank independent inspection panel to evaluate concerns about the program.

Weeks later, the World Bank approved the $40 million in funding but, in an unusual move, agreed to delay beginning the program until the independent panel had issued its report. The U.S. and Germany voted against the plan.

The panel's report was issued on April 28. According to a copy printed in the Financial Times of London, it criticized several of the Bank's planning and design of the project.

Among other findings, the panel reportedly concluded that the World Bank did not consider alternatives to the relocation, and broke its own rules regarding environmental screening.

Despite that critique, China intends to go forward with the relocation as originally planned. Chinese program head Zhu Xian said, "China accepts no conditions beyond management's original recommendations that had been agreed between management and my authorities."

"We regret that because of political opposition from some shareholders the World Bank has lost a good opportunity to assist some of the poorest people in China, probably in the world, after so much effort by World Bank management and staff," Zhu said.

The World Bank said Friday it would release the panel's report and address the issues raised there and by the Chinese director in the near future.

The controversy over the Tibet project is one of several areas where environmental and other activist groups have recently clashed with the World Bank.

In April, thousands of protesters rallied outside Bank headquarters, denouncing the strict restructuring programs the institution requires poor nations to undertake when they receive Bank loans.

By JARRETT MURPHY