Human Rights Criticism of the World Bank's Private Sector Development and Privatization Projects

Abstract

The World Bank is no stranger to criticism of its projects, especially in respect of its privatization and private sector development projects. Critics point to the environmental, social and cultural damage that certain projects have caused, which for some appears not just to be a product of the individual projects themselves, but symptomatic of a broader policy failure within the Bank to engage with the social consequences of its actions. In fact, and somewhat surprisingly, both the Bank's critics and its defenders seldom employ human rights language in their reasoning and rhetoric, and where they do, it is only fleetingly and often lacking in any real substance. This is surprising because of so much of what the Bank does can be, and is, supportive of the objects of international human rights standards, especially in respect of economic, social and cultural rights. It is a central theme of this Discussion Paper that for the Bank to embrace this fact alone would be a very significant step towards it being better able not only to respond to its critics, but also, crucially, to deliver upon its own objectives as most recently expressed in the Millennium Development Goals.

This Discussion Paper was commissioned by the World Bank. The brief was to provide an account of the major criticisms directed at the World Bank's private sector-oriented projects, and to determine what, if any, consequences for the protection of human rights are revealed by those criticisms. The approach adopted in this paper is first to identify key criticisms through empirical research and then to subject them to human rights analysis. This provides the basis for a clear account of the legal and programmatic implications for the Bank, today and in the future, of those human rights obligations and duties raised, directly or indirectly, by the critics of the Bank.

Keywords: international law, human rights, international institutions, aid and development, international investment

JEL Classification: F33, F34, K33, O23, O19, R58