Involuntary Resettlement 0P 4.12 Principles and Objectives WB Safeguards Training Workshop Almaty, December 2012

A Resettlement Overview Why does the Bank have an Involuntary Resettlement Policy? How has the Bank’s policy evolved? What are policy objectives and key principles What is role of Financial Intermediaries?

Why a Policy on Involuntary Resettlement? Bank funded investments, especially infrastructure development, often require the acquisition of privately and community owned land Land acquisition induced impacts include: physical relocation, loss of land and assets, disruption of livelihoods Without proper planning and management, involuntary resettlement may result in severe social impacts on affected populations

Resettlement History No mitigation: Those losing land must make a sacrifice for national development objectives Eminent domain: compensation for assets favors land owners. Risks of impoverishment if interests of poor and vulnerable are not recognized Resettlement can be a development opportunity too: Extending the reach of project benefits

Key Policy Objectives Avoid, minimize, or otherwise mitigate land acquisition and associated adverse impacts Assist all affected people to improve, or at least restore, incomes and living standards Resettlement as a development opportunity for households and community infrastructure (Mitigating risks for affected people helps minimize risks to borrower and Bank, too)

Key Guiding Principles All affected persons should be compensated or assisted in other ways, regardless of legal status Compensation for all assets at replacement cost (enough to obtain assets of equivalent value) Income restoration may require supportive measures in addition to compensation for assets Affected persons should be involved in resettlement planning and implementation Consultation Information Disclosure Grievance Procedure

Role of Financial Intermediaries Prepare and agree a Resettlement Policy Framework with the Bank, ensure FI capacity to oversee social safeguard subproject issues Screen all proposed on-lending activities for land acquisition/associated resettlement impacts (going forward and in anticipation of project prior to funding) Legal documents require compliance if IR impacts should arise For all subprojects involving relevant impacts, Bank approval of a resettlement plan required before accepted for financing

Recurring Issues and Problems Defining project scope: “Indirect impacts” and “linkage” in application of Bank policy Bridging the eligibility gap: Assisting vulnerable people and those who lack full legal recognition Covering all costs: ‘Replacement cost’ valuation, transaction costs and transitional support Asset stock versus income flow: Going beyond compensation to livelihood restoration and incorporation of development opportunities In FI projects, ensuring coordination with sub- clients in implementation and reporting

of land acquisition/involuntary resettlement The many faces of land acquisition/involuntary resettlement