Plantations, poverty and power - Critical Information Collective

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firm’s activities. After his company received an IFC loan, Allen Chan, Sino-Forest’s Chairman and CEO,
said, “IFC’s contribution is an endorsement of Sino-Forest as one of the leaders in sustainable forestry
management in China.”538
Similarly, when IFC agreed to give a loan to Stora Enso, Markku Pentikäinen, head of Stora Enso Asia
Pacific, said, “We are pleased to note that investors such as IFC appreciate our sustainability approach in
both forestry operations and paper production. IFC sets a good example for other investors in the region
through its emphasis on socially responsible investment.”539
Although the IFC has a series of policies which should mean that projects are screened against
environmental and social standards, the reality is that the IFC prefers doing business to upholding
standards.
The IFC gave its first loan to Kenya’s Pan African Paper Mills (Pan Paper). The mill stinks. A visitor
from the US-based NGO Global Community Monitor described the waste ponds near the pulp mill that
cover the land with “foaming acid smelling wastes”.540
Michael Ochieng Odhiambo, of the Kenyan NGO RECONCILE lists the health problems that residents of
Webuye complain of as a result of the pollution from Pan Paper’s operations: “irritation of the eyes and
respiratory tracts, dry mouths and scratchy throats, gross accumulation of fluid in air spaces impairing the
functioning of the lungs, cancer of the lung and throat, asthma, bronchitis, bronchial pneumonia,
conjunctivitis, hepatitis, dermatitis, tuberculosis, impotence, babies born with stunted reproductive
organs, retarded intelligence among children, and high levels of respiratory diseases.”541
In 1996, when IFC lent a further US$15 million to Pan Paper for an expansion of the pulp and paper mill,
IFC did not demand a full environmental assessment. Instead IFC relied on information provided by the
company and decided that Pan Paper “has made commitment to fully comply with World Bank policies
and guidelines”. 542
IFC promised to “monitor Panafrican Paper’s ongoing compliance with World Bank policies and
guidelines during the life of the project.” Unfortunately, IFC’s monitoring of Pan Paper only involves
reading reports submitted by the company and “periodic site reviews during project supervision”. 543 In
538 “Sino-Forest signs $25 million financing agreement to expand in China”, Paperloop, 9 February 2001.
http://www.paperloop.com/db_area/archive/pponews/2001/wk02_05_2001/92.shtml
539 “Stora Enso signs loan agreement with International Financing Corporation”, Stora Enso press release, 10 June 2005.
http://www.storaenso.com/media-centre/press-releases/2005/06/Pages/stora-enso-signs-loan-agreement-withinternational.aspx
540 “Field Report: Pan African Paper – Webuye, Kenya”, Global Community Monitoring, 22 September 2007.
http://www.gcmonitor.org/article.phpid=658
541 Michael Ochieng Odhiambo (2007) “Industrialization, environmental pollution and public health: Must communities
bear the cost while the Nation reaps benefits“, Mazingira Magharibi, Newsletter of the Western Kenya Environmental
Law Centre (WK-ELC), Issue 1, 2007. http://www.reconcile-ea.org/publ/MazingiraNewsletter01.pdf
542 “Panafrican Paper Mills Ltd. project number 7206”, IFC Summary of Project Information, 7 December 1995.
http://ifcln001.worldbank.org/IFCExt/spiwebsite1.nsf/f9e58192e8a7408b85256a5b006f2d2c/e4c499261afcf2668525688e0
0759411OpenDocument
543 “Panafrican Paper Mills Ltd. project number 7206”, IFC Environmental Documents, 6 December 1995.
http://www.ifc.org/ifcext/spiwebsite1.nsf/2bc34f011b50ff6e85256a550073ff1c/f82ec2b88cb393f38525688e00757818ope
ndocument