| 16-01-2014

CSOs condemn response of the IFC regarding investment in Honduras

International civil society organizations consider the World Bank's lending arm response to findings of the Bank's Compliance Adviser Ombudsman totally inadequate

International Civil Society Organizations (CSOs) express in a     collective statement complete disapproval of the response by the World Bank's private sector lending arm, the International Finance Corporation (IFC), to the highly     critical findings of the same Bank's Compliance Adviser/Ombudsman (CAO). These findings are in respect to IFC's investment in the palm oil and food company Corporación Dinant in Honduras, which has been associated with land conflicts and extensive human rights abuses, including the killing, kidnapping and forced eviction of farmers in the     Aguán Valley.

The CAO investigation reveals one of the most shocking investments in the IFC's history. According to it, the Bank's private sector lending arm, the International Finance Corporation failed to adhere to its own policies meant to protect local communities, and continued to allow the company to break through those safeguards over the past five years to the present; either failed to spot or deliberately ignored the serious social, political and human rights context in which this company is operating or where it did, failed to act effectively on the information; and failed to disclose vital project information, consult with local communities, or to identify the project as a high-risk investment, despite public information that was widely available at the time the investment was made.

In response, CSOs are now calling for:

  • An admission by IFC's CEO, Jin Yong Cai, of the many failures documented in the CAO investigation;
  • The immediate withdrawal of the Action Plan and IFC response. Instead, set up a consultation mechanism that involves farmers´ organizations in the development and implementation of a much stronger and more comprehensive action plan to correct the deficiencies highlighted by the CAO;
  • The suspension of any further disbursements to Corporación Dinant and abstinence from resuming funding until human rights violations committed against organised farmers and their supporters in the     Aguán Valley have been brought to justice;
  • President Kim to commission an independent investigation of the underlying systemic reasons identified by the CAO for the repeated and serious failures to adhere to standards by IFC staff;
  • A commitment to carry out human rights impact assessments in high risk countries and those with a documented culture of impunity.

For further information:

    Read CSOs response to the CAO investigation along with the background information on the CAO findings and IFC response (.pdf format)

    Read more on the Bajo Aguán case