Managing Local and International Conflict Over a Pulp Mill in Uruguay

BACKGROUND AND CHALLENGES

During the last decade, environmental and social impacts originating from two controversial pulp paper mills located in Uruguay near the Argentine border sparked significant diplomatic tensions between the two otherwise friendly neighbors. The conflict surrounding these pulp mills was marked by heated protests, bridge blockages, and international lawsuits. Argentine communities feared the mills would cause water and air pollution in the popular tourism region. Uruguayans resented Argentine obstruction of their economic development.

The mills were owned, respectively, by a companies from Spain and Finland. Prior to finalizing their proposed loan for the mills’ development, the International Finance Corporation (IFC) asked CBI to assess stakeholder concerns and facilitate their involvement in a review of the mills’ impacts and potential liabilities.

THE CBI APPROACH

CBI conducts a stakeholder assessment to identify stakeholders’ concerns about the mills, facilitates a dialogue about the IFC’s Cumulative Impact Study, and explores the possibility of jointly reviewing the mills’ impacts.

From November 2005 to March 2006, CBI staff and dispute resolution partners in Argentina and Uruguay conducted a stakeholder assessment and facilitated a dialogue about the IFC’s Cumulative Impact Study of the mills. The assessment revealed a sharp divide among stakeholders. Some were optimistic about the mill’s potential to bring jobs and development. Others felt that projects threatened the environment, tourism, agriculture, fishing, and their quality of life. To help bridge stakeholders’ differing perceptions, CBI asked stakeholders to consider the possibility of jointly reviewing the mills’ impacts. Many felt that a joint review of the draft Cumulative Impact Study would help address their questions and concerns. Others required assurances that a joint review of the mills’ impacts would include broad stakeholder representation; provide opportunity to review all credible information; respect sovereignty; be meaningful and transparent; and ensure a safe space for civil discussion.

CBI believed that a joint stakeholder review of the draft Cumulative Impact Study was possible. However, CBI felt that IFC and other stakeholders would need to clarify the terms of engagement first. To that end, the CBI team carried out a series of facilitated dialogues with stakeholders in both Argentina and Uruguay.

RESULTS

CBI’s stakeholder assessment provides a summary of key issues and specific environmental concerns; the assessment also provides the opportunity for CBI to help the IFC build their capacity to design public engagement processes.

CBI’s facilitated stakeholder assessment provided a summary of key issues on both sides of the border, as well as detailing specific concerns around the projects’ environmental impacts to the public. Along with additional feedback from public meetings, the assessment led to a new review of the impacts and changes to the mills’ design. During this project, CBI was able to assist IFC in building their capacity to design effective public engagement processes.