New World Bank fund to focus on ecological concerns

November 30, 1990|By New York Times News Service

WASHINGTON -- Industrial and developing countries agreed in Paris this week to establish within the World Bank a new fund devoted to protecting the environment.

The United States, which had resisted the formation of such a fund, has conditionally agreed, Bush administration and World Bank officials said yesterday.

Under the agreement, a three-year pilot program would provide $1 billion to $1.5 billion for projects aimed at preserving tropical forests and biological diversity, protecting the marine environment and promoting the efficient use of energy to slow global warming.

Supporters of the fund said it would help build environmental concerns into development in the poorer countries of Africa, Latin America and Asia.

Development in many, if not most, of these countries emphasizes rapid industrialization, economic growth and export expansion without regard to the effect on ecological systems.

The U.N. Environmental Program and the U.N. Development Program will help oversee the new fund, a the World Bank said in a statement yesterday.

The United States, which had hedged on supporting such a fund inside the World Bank, agreed in Paris to back it, said Leandro Coronel, a World Bank spokesman.

A Bush administration official who insisted on anonymity said U.S. support of the fund was a conditional compromise.

One condition, he said, was that any contributions to environmental projects beyond what the United States is now contributing to the World Bank would be made through the U.S. Agency for International Development rather than through the World Bank.

Another condition was that loans to developing countries for environmental purposes could be forgiven only if the benefits of the loan were global in scope as opposed to benefiting only the receiving nation.

Environmental groups in the United States strongly oppose entrusting the fund to the World Bank. They contend that the bank continues to back ecologically destructive projects such as broad-scale lumbering operations.

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