Fidest – Agenzia giornalistica/press agency

Quotidiano di informazione – Anno 34 n° 316

Independent report finds Dutch and German development banks failed to comply with environmental and human rights standards in financing the Barro Blanco dam in Panama

Posted by fidest press agency su martedì, 2 giugno 2015

Kiad, panamaAmsterdam/Bogota – Last Friday, a long-awaited report by an independent panel found that FMO and DEG, the Dutch and German development banks, violated their own policies by failing to adequately assess the risks to indigenous rights and the environment before approving a US$50 million loan to GENISA, the developer of the Barro Blanco hydroelectric project in Panama. FMO and DEG’s response to the findings, while acknowledging some deficiencies in their assessment, does not commit to any measures to address the outstanding policy violations. Even while the report concludes that “the lenders have not taken the resistance of the affected communities seriously enough,” it appears that FMO and DEG continue to do so.
In May 2014, the Movimiento 10 de Abril (M-10), representing indigenous peoples directly affected by the project, with the support of Both ENDS and SOMO, filed the first complaint to the Independent Complaints Mechanism (ICM) of the FMO and DEG. The complaint alleges that the Barro Blanco dam will affect part of the Ngöbe-Buglé indigenous territory, flooding their homes, schools, and religious, archaeological, and cultural sites. Despite national and international human rights obligations, the Panamanian government, GENISA and the banks failed to obtain the free, prior, and informed consent (FPIC) of the Ngöbe-Buglé before the project was approved. The ICM found that the “lenders should have sought greater clarity on whether there was consent to the project from the appropriate indigenous authorities prior to project approval.”
“We did not give our consent to this project before it was approved, and it does not have our consent today,” said Manolo Miranda, a representative of the M-10. “We demand that the government, GENISA, and the banks respect our rights and stop this project.” The ICM found that “while the [loan] agreement was reached prior to significant construction, significant issues related to social and environmental impact and, in particular, issues related to the rights of indigenous peoples were not completely assessed prior to the [loan] agreement.” The banks’ failure to identify the potential impacts of the project led to a subsequent failure to require their client to take any action to mitigate those impacts. The environmental and social action plan (ESAP) appended to the loan agreement “contains no provision on land acquisition and resettlement and nothing on biodiversity and natural resources management. Neither does it contain any reference to issues related to cultural heritage.”
“This failure constitutes a violation of international standards regarding the obligation to elaborate adequate and comprehensive Environmental and Social Impact Assessments before implementing any development project, in order to guarantee the right to free, prior and informed consent, information and effective participation of the potentially affected community”, explained Ana María Mondragón, lawyer at the Interamerican Association for Environmental Defense (AIDA).
While FMO and DEG acknowledged in their official response to the ICM’s report that they “were not fully appraised at credit approval,” they made no further concrete commitments to ensure that the rights of those affected by the dam will be respected. The banks claim that they are “facing limitations in their influence” over government processes to come to a satisfactory agreement with all stakeholders involved. Their actions, however, reveal a different story.
In February, the Panamanian government provisionally suspended construction of the Barro Blanco dam. Subsequent to the suspension, the government convened a dialogue table with the Ngöbe-Buglé, with the facilitation of the United Nations, to discuss the future of the project. Rather than encouraging the Government of Panama to respect the rights of the Ngöbe-Buglé, FMO and DEG have requested that Panama’s environmental authority reconsider the suspension and allow their client to resume construction. In February, they sent a letter to the Vice President of Panama, expressing their “great concern and consternation” about the suspension and noting that it “may weigh upon future investment decisions, and harm the flow of long-term investments into Panama.”


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