A tale of two statements

It is well known that on June 29, 2012, the World Bank announced cancellation of $1.2 billion concessional credit for the construction of the Padma multipurpose bridge. The cancellation was based on the ground of the failure of Bangladesh government to implement several measures identified by the Bank in the backdrop of what the Bank considered to be "credible evidence of corruption related to financing of the bridge."
On September 20, 2012, a statement was issued to the effect that the Bank will engage anew in the Padma multipurpose bridge upon satisfactory implementation of the agreed measures by the government.
Two points emerge from this part of the statement:
* The Bank's engagement with financing is a future possibility; and
* The realisation of this possibility is conditional upon satisfactory implementation of the agreed measures.
The statement notes that a series of measures to which the government agreed as a pre-requisite included:
* New procurement arrangement with enhanced oversight to ensure transparency and clean construction of the bridge;
* Investigations proceeding in a full, fair and expeditions manner; and
* An independent External Panel to review the government's investigation and report their findings to the government and the World Bank.

It may be observed that the use of the term "include" implies that the list of measures specifically mentioned in the statement itself may not be exhaustive. The statement also noted that "the World Bank understands that all government employees and officials alleged to have been involved in corrupt acts in connection with the project have been put on leave from government service until an investigation is completed, and a full and fair investigation is now underway."
The above statement was misconstrued by some quarters in Bangladesh as if the World Bank had already agreed to renewal of financing. Presumably based on this understanding, a tentative timetable for starting the construction of the bridge was also announced. Such an understanding was obviously misplaced as a future possibility was confused with the present reality.
In this situation, the Bank issued another statement on September 25, 2012, reconfirming and, to an extent, elaborating the preconditions. One element of elaboration deserves particular mention. A positive report from the External Panel of internationally recognised experts who will advise the Bank and co-financiers on the credibility of the government's investigations has been cited as a precondition for the Bank to go ahead with the financing of the project. In light of the two statements of the Bank, the government needs to take the following actions in order to translate the possibility of the World Bank's re-engagement in the Padma bridge project into reality.
* The government must faithfully and transparently implement all the measures to which, as the World Bank states, it has already agreed;
* An early initiative to reach a consensus between the government and all the co-financiers on the composition as well as terms of reference of the External Panel of internationally recognised experts is an urgent imperative;
* It is usually stipulated in all projects financed by external assistance that procurement procedures of relevant donor agencies will be followed. Therefore, what additional arrangements are required to ensure enhanced oversight by the World Bank and co-financiers should be agreed upon expeditiously;
* All public comments, especially by those who are connected with the government in whatever capacity, which sometimes degenerate into diatribes against the World Bank should be meticulously avoided.

The writer, presently a visiting professor in Brac University, is a former adviser to a caretaker government of Bangladesh, Ministries of Finance and Planning.