New Steps Toward IFI Transparency: The Use of Domestic Remedies

20 January 2006

Mexico established a landmark precedent for the application of national freedom of information laws to the activities of international institutions when its Information Commission on Nov. 16, 2005 ordered the disclosure of documents related to a $108 million World Bank loan to the state of Guanajuato, México.

The decision by the Federal Institute for Access to Public Information (IFAI) frees up new material about a major project to reform the water systems, the highways and the housing infrastructure in Guanajuato – the home state of Mexican President Vicente Fox, and neither the poorest Mexican state, nor one affected by emergencies and conflict. The materials were made available Jan. 16, 2006 and are currently being analyzed by Mexican NGOs.

A Mexican nongovernmental organization, Freedom of Information Mexico (LIMAC in Spanish), chose this project to test access to information from the World Bank. LIMAC argued that there was a very clear, overriding public interest to know why Guanajuato was chosen from among the other 31 states. The project is the first loan allocated under the Country Procurement System by the World Bank using what is known as a "country system" modality, which relies on assessment evaluations and environmental impact studies prepared by the government instead of by World Bank staff.

Access to information from the World Bank and other international financial institutions (IFIs) is a major international transparency issue. The Global Transparency Initiative, of which LIMAC is a member, is an international organization committed to expanding the transparency of IFI transparency through various activities. The GTI has used new and creative strategies, such using domestic Freedom of Information (FOI) laws to obtain information from the IFIs and member governments.

Using domestic access-to-information laws is one attempt to establish new legal ways to request IFI documents. It is also a strategy to challenge denials of access to information through judicial or other appeals remedies.

LIMAC requested minutes and other documents related to the evaluation process used by the financial agent of the project, the National Bank of Public Works and Services (Banobras), and the World Bank. LIMAC requested the same information from the Exterior Ministry, the Federal Treasury, the government of the State of Guanajuato and Banobras in Mexico.

All of those approached replied that the decision was in the competence of the World Bank, not their own. When LIMAC asked for the information from the World Bank, however, the response was that the Mexican government was responsible for the information as the "owner of the project" according to Bank procedures.

After a long process, the NGO presented an appeal to the Mexican Federal Institute for Access to Public Information (IFAI), arguing that the financial agent, Banobras, played a crucial role in the meetings with the World Bank and that a record of those meetings and evaluations should be kept in Banobras offices.

In its litigation strategy, LIMAC analysed domestic policies that regulate the duties and responsibilities of Banobras to participate in the selection of the beneficiary of World Bank funding. LIMAC also looked closely at the Bank’s policies for assignment of these sorts of loans. One of the main pitfalls that the NGO found was that the decision-making process inside the country is not clear, at least on paper.

In fact, the legal argument made in the appeal was based in points B2 and B3 of the Project Appraisal Document on a Proposed Loan in the Amount of Us$180 Million to the National Bank of Public Works and Services (Banobras) with the Guarantee of the United Mexican States for a Decentralized Infrastructure Reform and Development Loan Project, produced by the World Bank April 23, April 2004. It was clear that Banobras and the World Bank together determined that the project in Guanajuato was eligible for the Bank to finance among other candidates.

In November 2005 the IFAI resolved that because Banobras took part in the selection process, some evaluation or assessment documents must exist, especially those that could lead observers to learn more about the criteria for defining the beneficiary. IFAI’s resolution told Banobras to search for such documents, and any others not specified in the original petition of LIMAC related to the project, and mandated full disclosure within 10 working days, a period which expired Jan. 16.

This resolution is a big step for IFAI, setting a national legal precedent for using the Mexican FOI law to access such IFI-related documents. IFAI’s resolution can also be seen as a pressure to better define the processes governing the affairs between IFIs and the Mexican government, including recordkeeping.

Most importantly, the action assures that there is a general right to access such documents. IFAI’s conclusions and the case promoted by LIMAC demonstrate that the sort of information sought is of national interest, and not just for governments to keep private.

According to LIMAC’S arguments in the appeal, IFI information on decision-making matters is of interest not only to NGOs, such as the GTI, the bank-watching and environmental organizations, but also crucial for states and municipalities that seek international financial support but lack power to compete in the allocation processes and to participate in the negotiations between the states and the IFIs.

By Issa Luna Pla

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Filed under: IFTI Watch


In this column, Washington, D.C.-based journalist Toby J. McIntosh reports on the latest developments in information disclosure in International Financial and Trade Institutions (IFTI).
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