World Bank cancels funding for Bisri Dam project

BEIRUT: The World Bank announced Saturday that funding for the Bisri dam project has been canceled due to the “non-completion of the tasks that are preconditions to the commencement of construction of the Bisri Dam.”

According to a statement issued Saturday, the canceled portion of the loan is $244 million and the cancellation is effective immediately. Certain categories of expenditures related to fiduciary and environmental/social safeguards requirements will remain exempt from cancellation at this time.

In response to the Lebanese government's request for a three-month extension of the July 22 deadline set by the World Bank and taking into consideration the constraints imposed by COVID-19, the World Bank had agreed to a six weeks extension ending on September 4, 2020.

The Bank indicated that the suspended portion of the Loan would be canceled unless it receives satisfactory evidence that the government has finalized the Ecological Compensation Plan (ECP) following due process and in consultation with key stakeholders by no later than September 4, 2020, the government has finalized the Operation and Maintenance (O&M) arrangements by no later than August 24, 2020, and the contractor is mobilized at the worksite by no later than September 4, 2020.

The Lebanese government submitted a draft ECP on August 12, 2020, and the World Bank provided its comments on August 25, 2020. To date, these comments have not been addressed to the satisfaction of the Bank and stakeholder consultations have not taken place.

The World Bank said in the statement that it reiterates its readiness to work with the Lebanese government to see how the existing portfolio, including amounts from the canceled Bisri project, could be used most effectively to respond to the emerging needs of the Lebanese people.