Ownership and Sustainable Development Conundrum: The World Bank's Use of Borrowers' Systems

Abstract

In 2015, though several joint statements, Multilateral Development Banks (MDBs) repeatedly stated their support to the Sustainable Development Goals (SDGs). But 2016 saw another milestone in development finance: the World Bank adopted new environmental and social safeguards that place more responsibility on Borrowing Countries, which will enter into force in 2018. Shifting responsibilities had already been attempted in the wake of the 2005 “Paris Declaration on Aid Effectiveness”, when the World Bank launched a pilot program in order to use Borrowers’ systems to address environmental and social safeguard issues. But the policy’s objectives of both supporting Borrowers’ own policies without watering down environmental and social performances resulted in practice in a rather complex and intrusive process. The paper seeks to analyze whether the new safeguards will be a solution to this dilemma, both supporting the implementation of sustainable development while placing more responsibility on Borrowers, or if the World Bank is likely to abandon at least one side of the issue, either by conserving an intrusive process for Borrowers or by foregoing the implementation of sustainable development as envisioned by the SDGs.