European bank loans for Palestinian water project are misguided, say NGOs

A West Bank water extraction project designed to aid the peace process could sacrifice long-term environmental sustainability in the region in return for short-term political gain, according to an independent study published on 5 February.

The European Investment Bank (EIB) is lending 30 million euros (£19 million) to a scheme designed to provide adequate drinking water for up to 350,000 Palestinians in the southern part of the West Bank. The scheme is intended to improve living conditions, a move which is thought will help the peace negotiations, an EIB spokesman told edie.

“An adequate number of wells to monitor the capacity of the aquifer should be constructed before rushing ahead with additional pumping,” said Gert de Bruijne of the Palestinian Hydrology Group, a Palestinian NGO, and co-author of the study. “Sewage systems to deal with the increased flows of waste water should be constructed in parallel, and not at some undefined later stage as the EIB currently presumes. We are also faced with a situation where the local communities impacted by the project have not been informed and consulted about their opinion.”

Palestine is already confronted with the prospect of having exhausted the aquifer’s water resources even before the loan is repaid to the EIB, says De Bruijne. “We urgently need investment in the water sector, but the lending rush of western donors is an obstacle rather than a help. You do not help the peace process but create disillusion by promising things that you know you cannot deliver sustainably over time,” he said.

There is almost no chance that the water in the aquifer will be exhausted, said the EIB spokesman, pointing out that the project will be using new and used water, with a system of used water management to be set up in the future. The bank’s involvement will not merely end with the distribution of funds, said the spokesman, but will continue through implementation and monitoring.

The authors of the report acknowledge that many of their concerns have now been addressed by the bank, but there should always be concern about use of an aquifer which is already depleted, De Bruijne told edie. “I am happy to give them credit for the changes,” he said, pointing out the at the Palestinian Hydrology Group welcomes the involvement of such an important financial institution. However, they still have concerns regarding the sanitation issue in the area, and about the availability of information, even between Palestinian governmental departments. “It is too early to say that all our concerns are answered,” said De Bruijne.

The EIB needs to improve communication channels throughout the organisation in order to give its staff more information from local communities and NGOs, says Magda Stoczkiewicz of CEE Bankwatch Network, an NGO involved in an on-going international campaign to reform the EIB. “If the bank would adopt a participatory information policy such disasters as the one looming in the Palestine water project could be prevented and projects corrected at an early stage of the project cycle.”

Even the European Parliament has called upon the EIB to improve its transparency and accountability, including a request for reports to be made available on its website and to be guided by the best practice followed by other international financial institutions such as the World Bank. The European Parliament also agrees that the EIB needs to consult more with international charities or NGOs about individual projects. He is also recommending that the EIB pays more attention to backing environmental projects and not just those involving infrastructure.

According to CEE Bankwatch Network, NGOs are also calling for greater access to information at the European Bank for Reconstruction and Development.


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