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How the World Bank’s safeguards failed to uphold human rights in Honduras and Kenya

At COP16 in Cancun at the end of 2010, parties to the UNFCCC agreed that, “Parties should, in all climate change related actions, fully respect human rights.” Since then, however, there has been no further guidance. And the word “should” rather than “shall” is worrying, to say the least.

In February 2015, 260 NGOs signed on to a submission to the Ad Hoc Working Group on the Durban Platform for Enhanced Action calling for human rights protections in the Paris Climate Agreement:

We call on the State Parties to include language in the 2015 climate agreement that provides that the Parties shall, in all climate change related actions, respect, protect, promote, and fulfil human rights for all.

The CDM approval process does not involve any social standards. This has led to a long list CDM projects that involve human rights abuses. Here are two of the harmful CDM projects that Carbon Market Watch is currently highlighting on its website:

    The CDM Board registered the Santa Rita Hydroelectric Plant in Guatemala in June 2014, despite human rights violations against indigenous Q’eqchies communities, who are directly affected by the dam. In August 2014, Guatemala’s Ministry of Interior sent 1500 police officers to dismantle a peaceful protest against the dam. Police killed three people, injured 50 and arrested 30.
    The Barro Blanco Hydroelectric Power Plant was approved in June 2011, despite the concerns of local and international NGOs. The reservoir behind the dam would flood the lands of the Ngöbe and Buglé indigenous peoples. Carbon Market Watch reports that, “Violent repression by President Martinelli against the peaceful Ngöbe protests left three of them dead and more than a hundred wounded. Communications were cut and human rights were severely violated.”

A recent paper in the Cambridge Review of International Affairs looks at human rights and the Clean Development Mechanism. It concludes (with a large dose of academic restraint) that,

“It therefore seems recommendable that the UN climate regime develop mandatory human rights safeguards.”

The paper, “Human Rights and the CDM“, is written by Jeanette Schade of Bielefeld University and Wolfgang Obergassel of the Wuppertal Institute for Climate, Environment and Energy. It focusses on two CDM projects: Bajo Aguán in Honduras, and Olkaria in Kenya.

The authors chose the two projects “to contrast different approaches to the application of international safeguards”. The Bajo Aguán CDM project is a purely private investment and “is characterized by the complete absence of international safeguards”, they write. The involvement of international lenders in the Olkaria project, including the World Bank and the European Investment Bank, made the project subject to the World Bank’s operational policies.

Bajo Aguán, Honduras

The Bajo Aguán CDM project aims to recover biogas from palm oil mill effluent and use it to generate power. The company involved, Exportadora del Atlantico, is a subsidiary of Grupo Dinant, owned by the family of Miguel Facussé. For decades, Grupo Dinant’s oil palm plantations that supply the mill have been the centre of a violent land dispute. Human Rights Watch reports that more than 100 peasant farmers have been killed. Members of the local community have accused security guards working for Facussé of being directly involved in human rights abuses.

The CDM Board registered the project in July 2011. “Plainly, the events that have been described are deplorable. There is no excuse for them,” the then-chair of the CDM Board, Martin Hession, told EurActiv. But he added that the CDM Board’s mandate covers only greenhouse gas emission reductions and environmental impacts and was therefore powerless to block project registrations because of human rights abuses.

Although the World Bank was not involved in the Bajo Aguán biogas CDM project, the International Finance Corporation did finance Grupo Dinant. In 2013, Friends of the Earth’s Jeff Conant wrote,

Dinant’s oil palm plantations have been at the center of land conflicts dating back to the 1970s. Despite a long history of conflict, the IFC paid the first of two $15 million loan installments to Grupo Dinant in November, 2009 – shortly after a military coup had ousted the democratically elected president. The coup was publicly supported by Grupo Dinant’s CEO, Miguel Facusse.

In January 2014, the World Bank’s Office of the Compliance Adviser Ombudsman released its report following an investigation of the IFC’s US$30 million loans to Grupo Dinant. The Guardian reported that,

The verdict could not have been clearer: the World Bank’s private lending arm failed to comply with its own ethical standards when it lent millions of dollars to a Honduran palm oil company accused of links to assassinations and forced evictions.

Olkaria, Kenya

The 140 MW Olkaria IV geothermal power plant is part of the US$1.39 billion Kenya Electricity Expansion Project. As the name suggests, it’s the fourth geothermal plant in the Olkaria area. The project also includes a 140 MW expansion of Olkaria I. All four geothermal power plants are registered as CDM projects.

The Olkaria area is home to the Maasai indigenous people. For more than a century, the Maasai have been forced off their land as a result of dubious land deals and “development” projects. Four Maasai villages were evicted to make way for the Olkaria IV plant.

The fact that the World Bank is one of the financiers of the project means that the Bank’s policy on involuntary resettlement has to be applied. Schade and Obergassel argue that “The safeguards have … helped guard many substantial human rights such as the right to an adequate standard of living and the right to health.”

They acknowledge that, “There are still weaknesses, however.” There were only two days between the Maasai being told they had to move and the first census. The Maasai were moved from an area of 4200 acres and given only 1700 acres to live on. There was no assessment carried out to determine whether the new area was large enough for their cattle. There was a conflict among the Maasai during the process of agreeing to be kicked off their land to make way for the project.

There are ongoing land conflicts in the area between the Maasai and the Kenya Electricity Generating Company. In July 2013, landowners hired 200 people who, with the support of armed police officers, burned or destroyed 60 houses. Two thousand people become homeless and 200 cattle were killed. The World Bank denied any responsibility, despite the fact that the people from one of the villages involved would have to be evicted for the Olkaria IV project:

The July 16, 2013 eviction of Maasai families from land in Ng’ati Farm is not linked to the World Bank-financed Kenya Electricity Expansion Project

In February 2015, after Schade and Obergassel’s paper was published, the World Bank’s Inspection Panel released a Report and Recommendation about the Olkaria geothermal project.

In October 2014, Maasai leaders sent a request to the World Bank’s Inspection Panel, explaining that the evictions led to “impoverishment, intra-community disputes, and health concerns”. They also state that the Bank “did not closely monitor the resettlement process”, despite promises that it would do so. The Maasai accuse the Bank of breaching its own standards.

The request notes that many of the Maasai who were evicted now live a long way from their main sources of income. The new houses threaten the Maasai’s “cultural belief and spirit of togetherness”. KenGen did not build enough houses. Some communities face further threats of eviction because of planned geothermal operations in the area and new drilling started near the resettlement site even before the resettlement was finished.

World Bank management again denied that the problems were a result of the project. After visiting the project area and speaking to the Maasai (as well as other financiers and KenGen), the Inspection Panel reported that,

the issues of harm raised by the Requesters are plausibly linked to Project activities, and notes potential non-compliance by the Bank with applicable operational policies and procedures. The Panel also affirms that these alleged issues of harm and compliance are of a serious character.

The Inspection Panel will carry out an investigation and report in August 2015.
In Honduras, the World Bank breached its own safeguards. It looks very much like it did the same thing in Kenya. In both cases, the CDM Board took no account whatsoever of potential human rights abuses when it approved the CDM projects.

Full Disclosure: This post is part of a mini-series on REDD safeguards, funded by FERN. Click here for all of REDD-Monitor’s funding sources.

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  1. Is the best for mr abdon nababan activity because for good enfiromental world

  2. I really appreciate this highlight of the Masaai community. Indigenous peoples are suffering everywhere in Kenya. Injustices that go back to colonial times have not been handled and such projects are a clear indicator that post colonialism is a reality all in the name of projects that are perceived to benefit the people but in actual fact are establishments meant to benefit the colonizers

  3. The Banco Barra dam in Panama is partly financed by German Investment Corporation (DEG), a subsidiary of KfW. See this recent article on Deutsche Welle:

    German development bank involved in contested dam project

    “[A]ccording to Regine Richter of the German environmental and human rights organization Urgewald, the main problem with the project near the border with Costa Rica is that affected indigenous citizens were not properly consulted.

    “Richter says locals should be drawn into such projects at a very early stage, and also profit from them. This did not happen with Barro Blanco, she added.”