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Submitted by Laura E. Bailey on
Thanks to KTM for the thoughtful comments. I don't want to get into a debate about the relative income increases from palm oil vs other crops. partly because the official data available are very unreliable, but mostly because there are other dimensions that we at the World Bank take into account when we work with national authorities to determine where and how to engage to support improved lives for the people. We look not just at national averages and theoretical financial returns in terms of income changes attributed to a particular crop, but ALSO at the extent to which economic growth and development is inclusive, benefiting people widely, and we also look at the extent to which the development path seems to be resilient, and able to withstand difficult times. From that perspective, we believe that it makes sense for the World Bank to be working in all three crops ... oilpalm, through the Smallholder Ag Devt Project (SADP), and coffee and cocoa, through the newly-approved Productive Partnership in Ag Project (PPAP). We hope to help smallholders who aren't getting good returns in a nationally profitable sector do better (oilpalm) AND to help smallholders who can have a diversified production base that includes other cash crops (cocoa, coffee) earn better returns through improved practices and better market access. Your question about political risk is a good one as well. The World Bank is dedicated to being a non-partisan, non-poitical partner with the people and Governments in the countries we work with, but certainly we are affected by -- and must be mindful of -- the global and regional debates. Over the past 20 years we've seen a significant increase in attention to einvironmental and social issues within development projects worldwide, and this is an active and welcome dynamic in Bank projects too. Certainly everything we're currently doing with the SADP proejct is focusing on improving smallholder livelihoods while STILL being mindful of environmental and social risks. We're trying to respond as proactively as possible to any concerns that are raised, and we'll continue to be responsive. Separately from our project-specific work with smallholders in Oro and WNB, the World Bank Group has started the consultative phase of a process led by IFC to develop a WBG Palm Oil Strategy. This process seeks multiple stakeholders’ input into developing a framework and a set of principles to guide World Bank Group’s future engagement in the palm oil sector. For more information on the palm oil strategy development process -- which included key activities in DC in April during the Spring Meetings -- please visit the dedicated web site: http://www.ifc.org/palmoilstrategy.