Washington DC, April 11, 2006—
The International Finance Corporation (IFC) today publicly released the report of a panel of independent experts commissioned to review comments provided by stakeholders on the draft Cumulative Impact Study (CIS) of two pulp mill plants in the Rio Uruguay. IFC welcomed the findings and the recommendations of the experts’ report and will shortly announce an action plan to address the panel’s recommendations.
The expert panel, which included Canadians Wayne Dwernychuck and Neil McCubbin, identified a need for additional information and analysis to accurately determine and substantiate the environmental impacts of the CMB and Orion projects. The experts also recommended a number of technical improvements that could enhance the environmental performance of both mills. IFC is in discussions with the companies on how to address these issues.
Overall, the experts recognize that although mill design, operating procedures and environmental monitoring can be improved, concerns that the mills will cause widespread environmental damage are unsupported. Further, they recommend that more information is needed to answer questions raised about health impacts; that further information and analysis should be provided with respect to tourism; and, that emergency response and environmental management and monitoring plans need to be more fully developed.
IFC, as a member of the World Bank Group that promotes sustainable development of the private sector in emerging markets, will only finance projects that meet its strict and internationally recognized environmental and social standards. For this reason, IFC endorses the need for additional information and analysis recommended by the experts and regards it as essential to ensuring compliance with its own environmental policies, to making a well informed decision on whether to finance the pulp mills, and to fully and accurately informing stakeholders on the environmental and social impacts of the mills.
IFC is evaluating whether to provide financing to proposed Orion and CMB plants. In addition, the Multilateral Investment Guarantee Agency (MIGA), also an arm of the World Bank Group, is evaluating whether to provide political risk insurance to investors in the Orion plant.
Neither IFC nor MIGA will make a decision on whether to proceed with funding until the revision of the Cumulative Impact Study is completed.
The Consultation Process
The draft Cumulative Impact Study on the social and environmental impact of the two proposed pulp mills was made available for public review on December 19, 2005, allowing a minimum of 60 days for comments prior to any decisions by the World Bank Group on the proposed financing and guarantee for the pulp mills.
In addition to written submissions received, starting in mid-January, a series of meetings were held in Uruguay and Argentina to enable stakeholders to provide their comments and concerns on the draft CIS directly to IFC and MIGA staff. Following the 60-day consultation period, which ended February 17, IFC sent all comments received on the CIS to the independent expert panel to fully analyze the comments and provide its findings to the World Bank Group.
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