Ethiopia Refuses to Cooperate With World-Bank-Funding Probe

By William Davison, Bloomberg
May 28, 2013

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Ethiopia’s government said it won’t cooperate with a probe into whether the World Bank violated its own 
policies by funding a program in which thousands of people were allegedly relocated to make way for agriculture investors.
Ethnic Anuak people in Ethiopia’s southwestern Gambella region and rights groups including Human Rights Watch last year accused the Washington-based lender of funding a program overseen by soldiers to forcibly resettle 45,000 households. The Inspection Panel of the World Bank, an independent complaints mechanism, began an investigation in October into the allegations, which donors and the government have denied. “We are not going to cooperate with the Inspection Panel,” Getachew Reda, a spokesman for Prime Minister Hailemariam Desalegn, said in a phone interview on May 22. “To an extent that there’s a need for cooperation, it’s not going to be with the Inspection Panel, but with the World Bank”
Ethiopia, Africa’s most-populous nation after Nigeria, has made 3.3 million hectares (8.2 million acres) of land available to agriculture companies. Investors include Karuturi Global Ltd. (KARG) of India, the world’s largest rose grower, and companies owned by Saudi billionaire Mohamed al-Amoudi.
There is a “plausible link” between the Promoting Basic Services program, partly funded by the bank to pay the salaries of local government workers, and a resettlement process also known as villagization in Gambella, the panel said in a Nov. 19 report obtained by Bloomberg News. The World Bank confirmed the authenticity of the report.
‘Potential Non-Compliance’
The concurrent implementation of PBS and the resettlement program may raise issues of “potential serious non-compliance with bank policy,” according to the report.
“From a development perspective, the two programs depend on each other, and may mutually influence the results of the other,” the panel said.
Human Rights Watch, based in New York, made similar allegations about the resettlement program in a January 2012 report. Those findings and the Inspection Panel process are part of a “propaganda campaign being waged against the government,” Getachew said by phone from the capital, Addis Ababa. “It’s not a World Bank inspection panel, it’s a panel that likes to impose its mostly fictitious findings on the decision-making process of the World Bank.”
About 35,000 households voluntarily moved over the past three years in Gambella and now have better access to public services and are growing more food, State Minister of Federal Affairs Omod Obang Olum said in a May 15 interview.
‘Unprecedented’
The complaint to the panel was made on behalf of 26 Anuaks now living in South Sudan and Kenya. Refusal to cooperate with the panel by a World Bank member state is “unprecedented,” said David Pred, a managing associate at Inclusive Development International, or IDI, a California-based human-rights group that assisted with the complaint.
“I don’t see how the bank could justifiably continue supporting Ethiopia if the government simply rejects outright any semblance of accountability,” he said in an e-mailed response to questions.
The complaints should be investigated further “as they pertain to the bank’s application of its policies and procedures,” the panel said. The probe should not look at allegations of “specific human rights abuses” or the “underlying purposes” of the resettlement program, it said.
Donor Aid
Donors provided $3.56 billion of aid to Ethiopia in 2011, which was 11.3 percent of gross national income, according to the Organisation for Economic Cooperation and Development.
The World Bank said that while officials on PBS-funded salaries may have “responsibilities related” to resettlement, this doesn’t mean the two programs were “directly linked,” according to the panel.
There was no evidence of “forced relocations or systematic human-rights abuses,” according to reports by two fact-finding missions in 2011 and 2012 by donors including the U.K. and U.S. aid agencies. “Half of the people interviewed said they didn’t want to move” and some said public services hadn’t been provided in new sites, the 2012 report found.
PBS “does not build upon villagization, it is not synchronized with villagization, and does not require villagization to achieve its objectives,” the World Bank’s management said in response to the complaint. “Furthermore the bank does not finance” villagization.
Election Violence
PBS began in 2006 after donors stopped “direct budget support” to the federal government because of violence following a disputed 2005 election. The program provides block grants to regional governments that are mainly spent on education, health, agriculture, water and road workers.
A postponed March 19 discussion of PBS by the bank’s board has yet to be rescheduled, Guang Chen, the bank’s Ethiopia director, said in an e-mailed response to questions. “Staff are not authorized to comment prior to the board discussion,” he said.
Since 2006, PBS has cost donors and the government $13 billion, the panel said. The ongoing phase is funded by the government, the World Bank, the African Development Bank, the European Union, the U.K., Austria and Italy.
The panel also can’t comment at this stage, operations analyst Dilya Zoirova said in an e-mailed response to questions.
To contact the reporter on this story: William Davison in Addis Ababa via Nairobi at pmrichardson@bloomberg.net.
To contact the editor responsible for this story: Antony Sguazzin in Johannesburg at asguazzin@bloomberg.net.