Greater Beirut Water Supply Project

Lebanon is the most water-abundant country in the Middle East and North Africa region which is considered the world’s driest region. Despite this fact, the Greater Beirut area, home to 40% of the Lebanese population, has been suffering from shortages in potable water for the last forty years. This is mainly due to the lack of proper water storage facilities, increased demand and inefficient distribution networks, all compounded by many decades of political conflict in the country. The Greater Beirut Water Supply Project (GBWSP) aims to overcome this shortage by providing potable water from the Litani and Awali rivers to the residents of the Greater Beirut area and the low-income neighborhoods of Southern Beirut.

The Lebanese Government has been considering the project since the 1960s, and in the 1990s, the World Bank became involved through the provision of technical assistance but then dropped the project before any financing for implementing the project was disbursed. In 2010, the project was brought back to the Bank’s attention, and the Bank designed the GBWSP to help the Lebanese government overcome its pressing need to deliver clean and reliable water to the citizens of Greater Beirut. The Bank’s Board of Directors then approved the project on December 16, 2010.

The GBWSP, which consists of a series of tunnels, water treatment plants, reservoirs, a distribution network, and metering, is designed to meet Greater Beirut’s demand for 250,000 m3 of water per day. The total cost of the project is $370 million, of which $200 million will be provided by the International Bank for Reconstruction and Development (IBRD) in the form of a Special Investment Loan. The rest will be financed by the Government of Lebanon (GoL) and the Beirut Mount Lebanon Water Establishment (BMLWE). Lebanon’s Ministry of Energy and Water (MoEW) will be responsible for executing the project and will delegate implementation, monitoring and reporting responsibilities to the Council for Development and Reconstruction (CDR) and the BMLWE.

On November 4, 2010, a Lebanese citizen representing himself and 50 other Beirut inhabitants submitted a complaint to the World Bank’s Inspection Panel against the GBWSP. On November 11, 2010, the Inspection Panel officially registered the case by posting a “Notice of Registration” on its website that provided a summary of the request and notified the Bank’s management that it had 21 working days to respond to the complaint. The timing of this case was unique in that the Bank’s Management was expected to provide its response before the scheduled Board date for the project itself. In most cases, complaints come to the Inspection Panel after the Board has already approved a project. The project was approved by the Bank’s Board of Directors on December 16, 2010 despite lobbying efforts by civil society to push for the postponement of the approval date. Regardless, the Inspection Panel process is not hampered by the approval of a project and the Panel process for the GBWSP case will continue.

The citizens’ complaint questions the rationale behind the choice of the Litani and Awali rivers as the sources of water for the project, given that there are alternative water sources that are closer to Beirut than the Litani and Awali. Other concerns include the high pollution affecting the water sources, the potential impact of the project on agriculture-dependent communities, the high cost of the project and the resulting high tariffs that will be burdened by Lebanese citizens, and other social and environmental impacts. The complaint also touches on a number of possible Bank policy violations that the Inspection Panel has laid out in its Notice of Registration.

Projects financed by the World Bank should adhere to a strict set of environmental and social safeguard policies and procedures. In cases of possible violations, and after attempting and failing to resolve the concerns with the Bank’s Management, people from affected communities may submit complaints to the World Bank’s Inspection Panel. This is an independent body through which citizens harmed by World Bank-financed projects are able to submit their complaints and grievances.

BIC’s Middle East and North Africa (MENA) Program has been following the project’s developments closely and provided the complainants with information about the World Bank policies that govern projects. BIC/MENA has also been following the Inspection Panel process closely. See the Action section for updates on the process.

Analysis of Alternatives

For every project that the World Bank funds, it must conduct an adequate Analysis of Alternatives in order to justify the basis for selecting the final option proposed. The Greater Beirut Water Supply Project (GBWSP) calls for the conveying of water from the Litani and Awali rivers to the Greater Beirut area. In the Analysis of Alternatives for this project, the only alternatives studied entailed not doing the project or choosing different routes/water treatment sites/materials for the tunnels. The study failed to include alternative sources of water that might be closer to Beirut than the Litani and Awali rivers. The Inspection panel case complainants believe that this is a violation of the Bank’s policy which states that the Analysis of Alternatives should “systematically compare feasible alternatives” and provide a proper environmental and economic assessment for each of these alternatives where possible. Moreover, the analysis that was done, was based on outdated studies made in 1972 and 1984 and, therefore, is questionable in terms of relevance and validity.

In previous years, the Lebanese government had commissioned studies on alternative projects such as the Bisri Dam studied by the Litani River Authority (LRA)  and the Damour Dam proposed by Liban Consult, a Lebanese civil engineering consulting firm. However, these projects were not considered in the Bank’s Analysis of Alternatives. The main complainant, being a hydrogeologist himself, proposes an alternative project to the GBWSP and is supported by at least the 50 Beirut residents that asked him to represent them in the Inspection Panel complaint. In contrast to the using the Litani/Awali rivers, The complainant proposes building a dam on the Damour river, but whose location would be on a different portion of the Damour River than that proposed by Liban Consult. The complainant argues that the Damour River is closer to Beirut than the Litani and Awali rivers and its water is much less polluted than the waters of these two rivers.  This project will also allow more water to be stored and constitutes a cheaper alternative to the GBWSP ( approximately $225 million vs. $370 million for the GBWSP according to the complainant).

High water tariffs

The complainants believe that the GBWSP is the most expensive option among those projects that were studied or proposed. This necessarily translates into higher tariffs for the residents of the Greater Beirut area because the greater the cost of the project, the higher the tariffs. An increase in water tariffs by 10-15% annually constitutes financial harm to those residents, especially since other more affordable options have not been considered by the Bank.

Water pollution

The water used for the GBWSP is mainly Litani River water either stored at the Qaroun Lake or diverted to the Awali River. Studies conducted on this water have shown that it is extremely polluted and contains high levels of chemicals and bacteria. For this reason, the complainants argue that the Litani River water cannot be used for drinking purposes because even if the water is treated, this process will not be sufficient to treat the pollution caused by highly toxic industrial wastes. This constitutes health-related harms to the residents of Greater Beirut.

Deprivation of other areas from irrigation

Conveying the waters of the Litani and Awali rivers to Greater Beirut will deprive other areas such as South Lebanon, the Upper Litani Basin, Al-Chouf and Ikleem Al- Kharroub from the water of these two rivers. This constitutes a harm to the livelihoods of the agriculture-dependent communities concentrated in those areas as well as to all residents of those areas who depend on these rivers for potable water.

Public consultation 

World Bank policy stipulates that the borrower (in this case the Government of Lebanon) should conduct consultations with “project-affected groups and local nongovernmental organizations (NGOs) about the project’s environmental aspects and take their views into account.” Consultations for the GBWSP included ones that were held in 1997 and 1998 with local, national, and expert authorities. According to the complainants, those consulted cannot be considered representative of communities affected by the project, and the consultations are outdated. Although two more recent public consultations were held in 2010, from the list of attendees and the questions/answers portion of the sessions, it appears that the consultations were not comprehensive and do not represent the opinions of Greater Beirut inhabitants or the communities of South Lebanon, Upper Litani, Al-Chouf and Ikleem Al-Kharroub – all the communities who are actually to be affected by the project.

The complainants also draw attention to the Bisri Dam in their request which, in their opinion, is inextricably linked to the GBWSP based on several statements in the project documents and in government records. According to those statements, the Bisri Dam will follow shortly after the implementation of the GBWSP. Since no consultations were held with communities in Bisri or in nearby areas that might be affected by the construction of the Bisri Dam, the consultation process is not considered comprehensive.

Disclosure of information 

World Bank policy stipulates that the borrower should provide “relevant material in a timely manner prior to consultation and in a form and language that are understandable and accessible to the groups being consulted”. In the case of the GBWSP, the Resettlement Action Plan (RAP) and Arabic versions of the documents provided to citizens prior to consultations are not found on the World Bank or Council for Development and Reconstruction (CDR) websites. The complainants claim that this is a violation of the World Bank’s disclosure policy. The CDR is the main implementation agency for World Bank projects in Lebanon. A RAP is prepared whenever a World Bank project will directly lead to the resettlement of communities or the expropriation of their lands. It mainly includes a proposal for a resettlement program, the impacts of resettlement on local communities and any legal issues associated with it such as monetary compensation.  

Involuntary resettlement 

If a World Bank-financed project will lead to the involuntary resettlement of communities in the project-affected areas, the World Bank has specific guidelines it should follow and the matter should be addressed in the relevant Bank documents. According to those documents, there will be involuntary resettlement of communities in those areas that will be affected by the GBWSP but there is no mention of communities that may be affected by the construction of the Bisri Dam. As mentioned earlier, the Bisri Dam is dependent on the GBWSP; however, it is still unclear who is financing it. On the one hand, Bank documents reveal that the Bisri Dam will be financed by the Islamic Development Bank. On the other hand, based on a recent press release in An-Nahar newspaper provided by the complainants, “the Minister of Energy and Water has agreed to proceed with the construction of the Awali project on condition that the World Bank pledges to contribute in the financing of the Bisri Dam” and “the Bank has agreed to contribute in the financing of the Bisri Dam” (Press Announcement printed in An-Nahar newspaper, October 15,2010). Regardless of who is financing the Dam though, Bank policy “applies to all components of the project that result in involuntary resettlement, regardless of the source of financing.” In either case, the Bank should consider any resettlement that might occur as a direct or indirect result of the GBWSP, and that includes resettlement as a result of the Bisri dam, according to the complainants. 

Expropriation decrees were issued in the late 1990s for the purpose of the GBWSP. Some of these expropriations have been completed while the rest are being updated or reissued. The complainants question whether the completed expropriations should have taken place at that time given that the GBWSP has yet to be approved (more than ten years later) and knowing that these expropriations were carried out “for the purpose of the current project”. It is also unclear whether the expropriations mentioned in Bank documents are those that were already completed or those to be completed in the near future. Since all expropriations (completed and to be completed) are for the purpose of the current GBWSP, the complainants believe that Bank policy should be applied accordingly. They also argue that consultations for Involuntary Resettlement were again not comprehensive and did not include proper representatives of affected communities.

Safety of Dams 

The World Bank should consider its Safety of Dams policy in projects that include the construction of dams. The complainants claim that the Bisri Dam constitutes the informal second phase of the GBWSP even though the World Bank may not fund it. They also believe that the formations upon which the Bisri Dam is to be built do no constitute a suitable site for dam construction and the site is located close to an active fault. For these reasons, the Bank should take into consideration the safety of this structure.

Economic Evaluation of Investment Operations 

World Bank policy requires it to finance the cheapest alternative for a proposed project, assuming the same or better outcome. The complainants claim that it is unclear whether the GBWSP is the least costly option because the alternatives considered were not exhaustive. In case there are other projects that produce the same desired results as the GBWSP and prove to be less costly, then the choice of implementing the GBWSP constitutes a violation of this policy. The complainants argue that using water from the Damour river would yield the same or better results and is a cheaper option.

The total cost for the Greater Beirut Water Supply Project is estimated at $370 milllion. The World Bank, through the International Bank for Reconstruction and Development (IBRD), will provide a Special Investment Loan of $200 million. This loan will finace goods, works, consultants, reasonable associated taxes, and contingencies. The Beirut Mount Lebanon Water Establishment (BMLWE) will finance $140 million and the Government of Lebanon (GoL) will finance $30 million for land acquisition.

 

See Greater Beirut Water Supply Project Cost Breakdown

Project costs by component, Project Information Document, World Bank, November 8, 2010 (PDF, 48KB)

• The Inspection Panel received the complaint on the Greater Beirut Water Supply Project on November 4, 2010 and officially registered the case on November 11, 2010.
• Management submitted its response to the complaint on December 13, 2010 which argued that the case was not eligible for investigation.
• A team from the Inspection Panel conducted an eligibility visit to Lebanon in January 2011, where they visited the project site and met with the complainants and other authorities.
• The Panel then submitted an Eligibility Report to the Board on January 20, 2011 which included a recommendation by the Panel to investigate the case further. Recommendations by the Panel are presented on a non-objection basis, meaning that the recommendation is deemed approved if no Board member rejects it or requests a meeting to discuss the case within 10 days from the date the report was distributed to the Board.
• In the case of the GBWSP, a Board member requested a meeting to discuss the case. The meeting was held on March 10, 2011 to discuss the Eligibility report and Management’s concerns regarding the request for inspection. At the meeting, the Board asked the Panel to wait until July for the results of three water studies commissioned by Management to inform the Board on whether or not an investigation would still be warranted in light of the studies’ findings. The three studies focused on the cost, quality and availability of water associated with the project as these were identified by the Panel as the main issues warranting investigation.
• On June 9, 2011, Management at the Bank submitted those three studies to the Inspection Panel.
• After it had reviewed the studies with the help of expert independent consultants, the Panel published its report on July 29, 2011. Although the Panel was generally satisfied with the studies’ findings, there were still important questions raised on some of the assumptions made and methodologies used in those studies, and the experts hired by the Panel identified important implementation risks associated with the project that they say require further consideration.

• The Panel has informed Management of those risks, and Management has proposed an action plan to address them.  Management will report to the Board in 18 months (by the end of January 2013) on the progress of project implementation and implementation of the action plan. The Panel will monitor any developments related to Management’s action plan and will also report to the Board in early 2013 on whether subsequent investigation would still be warranted. It is important to note that the Panel’s mandate does not allow it to provide an independent assessment of the process unless through a formal investigation which it requires Board approval for.

The following diagram shows the Inspection Panel process after a Request for Inspection has been registered:

                                                Source: Inspection Panel Website 

The steps above are not inevitable, as the chart may suggest. Below is a more detailed chart on the Inspection Panel Process after a Request for Inspection is received:

Source: Inspection Panel Website

inspection panel

Request for Inspection, Fathi Chatila, November 2, 2010 (Inspection Panel website)

Notice of Registration, Roberto Lenton, November 10, 2010 (Inspection Panel website)

Management Response to the Request for Inspection, December 13, 2010 (Inspection Panel website)

Eligibility Report and Chairperson Statement, Inspection Panel, March 8, 2011 (Inspection Panel website)

Press Release: World Bank Board discusses Request for Inspection in Lebanon, World Bank Management and Inspection Panel, March 10, 2011 (Inspection Panel website)

World Bank Inspection Panel Website

Management Commissioned Studies

Project Cost Estimates, Financial and Economic Analyses, June 9, 2011 (Inspection Panel website)

Technical Review of Source Water Quality, June 9, 2011 (Inspection Panel website)

Technical Review of Source Water Quantity, June 9, 2011 (Inspection Panel website)

World Bank Documents

World Bank’s project page for the Greater Beirut Water Supply project (World Bank website)

World Bank’s Operational Manual that governs its operations (World Bank website)

World Bank Policy on Disclosure of Information, World Bank, June 2002 (PDF, 180KB)