(Financial Times, weekly, september 8 1999)

World Bank confronts its tangle

By Nancy Dunne in Washington

The board of the World Bank will this week take up an embarrassing challenge in connection with its controversial project to resettle 57,750 Chinese farmers in traditionally Tibetan lands in Quinghai in western China.

The board agreed on June 24 that the project, which is backed by a $160m World Bank loan and ignited a storm of controversy among pro-Tibetan and environmental groups, would not proceed without an official Bank investigation. The probe would determine if Bank staff had followed its own rules and procedures in designing the scheme.

The challenge now comes from Beijing, which last week contended the investigation had been triggered by "a politically contaminated request". The International Campaign for Tibet (ICT), based in the US, initiated the request. It says it takes no position on Tibetan independence but worries that the movement of more Chinese into the region will further dilute the native Tibetan and Mongolian cultures.

In a letter last week to James Wolfensohn, World Bank president, the Bank's Chinese executive director said the campaign was not an independent organisation but "a political body directly linked to and controlled by the Tibetan government in exile, which is a separatist group challenging China's sovereignty.

"ICT actually shares the same address, same office and same telephone and fax numbers with the Office of The Special Envoy of the Dalai Lama in Washington," said Xian Zhu, the Chinese director.

He said China would agree to the investigation but the inspection panel "must take immediate corrective action, so as to ensure that any acceptance of any request, if so occurs, should be established on sound basis".

When the Bank voted to approve the loan in June - over the objections of the US and Germany - the ICT request for an inspection panel had already been received. Mr Wolfensohn announced that China had agreed to an investigation and would allow "complete transparency", welcoming into the region the inspectors, diplomats, journalists and government officials, where they could have "extensive contacts with local people unattended by Chinese officials".

"We are in favour of transparency," Beijing said in an official statement. Two independent researchers - Gabriel Lafitte, an Australian, and Daja Meston, an American - visited the area last month only to be arrested and interrogated by Chinese security officials. Both have been released but Mr Meston was severely injured after falling from a window during questioning.