The environmental sustainability of development projects cannot be guaranteed without effective safeguards. The problem is how to strengthen safeguards systems, a need that is becoming more urgent as we grapple with the impacts of climate change.
It’s an issue that multilateral development banks (MDBs) in particular must take concrete and bold steps to address. Safeguards aim to mitigate the negative impact of projects on the environment and affected people. But they can be costly to implement for borrowing countries. In a study of 60 World Bank projects, for instance, the average direct cost to borrowing country is $13.5 million. This leads some countries to consider alternative lenders with less requirements.
But the benefits from mitigated harm to the environment far outweigh the costs of implementing safeguards. Aside from unvalued environmental and social benefits, proper safeguards implementation can drive revenue such as tourism... — blog.adb.org/blogs