How did Multilateral Development Banks systematically violate human rights in three hydroelectric projects in Guatemala? 

BIC and our partners’ analysis of three hydroelectric projects in Guatemala reveal a pattern of systematic rights violations of project-affected people and harm to the environment. MDBs need to place communities at the center of development projects and meaningfully engage communities throughout project lifecycles. 

BIC, Jotay: Acting Together Program, and Plataforma Internacional contra la Impunidad published a report analyzing the patterns and trends of human rights violations in three hydroelectric projects financed by the private arms of the World Bank Group (IFC) and the Inter-American Development Bank Group (IDB Invest) in Guatemala: (1) Canbalam in Santa Cruz Barillas (2011), (2) Santa Rita in Corbán (2012), and (3) the Ixquisis hydroelectric complex (2013), which includes the projects of Generadora San Mateo and Generadora San Andrés in the microregion of Ixquisis. Project affected communities of the three hydroelectric projects submitted complaints to the respective accountability mechanisms (Compliance Advisor Ombudsman - CAO - and the Independent Consultation and Investigation Mechanism - MICI) claiming a number of social and environmental harms and impacts, as well as human rights violations.

The report details the environmental and social harms identified by the project-affected communities and assesses eight major repeated patterns of rights violations related to the client’s non-compliance with the Performance Standards (PSs)[1] and the failure of the IFC and IBD Invest to adequately supervise the implementation of the PSs. These rights violations include: Indigenous Peoples’ right to self identification, lack of access to information and meaningful consultation, increased social conflict, retaliation against communities, increased harm to women, environmental and social impacts, fraudulent land purchase, and the damage and destruction of sacred and ceremonial sites of Mayan Indigenous Peoples. 

We found that the IFC’s role and performance in environmental and social due diligence was poor and limited. Moreover, the IFC failed to recognize the CAO findings and address the issues of non-compliance identified in the CAO investigation. Although the accountability mechanisms helped to empower and organize the communities and made their problems more visible, there have not yet been any concrete reparations. In addition, the IFC pulled its financing out of both projects without addressing any of the harms that their investment generated, making it very difficult for communities to obtain remedy. 

Our findings confirmed that the intended “beneficiaries” of these projects became the groups most negatively affected by the projects. These adverse impacts largely resulted from a lack of meaningful stakeholder engagement throughout the project cycle. The MDBs’ inadequate community engagement signals that MDBs are not learning from, or incorporating the lessons learned from, failed projects to improve future projects and avoid repeating past mistakes. Furthermore, it is clear that protection gaps exist in the PSs as many community members faced violence, coercion, and reprisals after trying to assert their rights. In many regards, the standards are incapable of meeting current environmental and social challenges. 

Considering the environmental and social damage caused by these hydroelectric projects, the report proposes an alternative model of energy sovereignty, which is both economically viable and environmentally sustainable, and is designed by the communities, for the communities. Moving forward, the report offers recommendations for MDBs, their grievances mechanisms, client companies, and the Government of Guatemala. Largely, the recommendations center around the need to put project-affected communities at the center of development projects. It is time MDBs and their clients understand safeguards and community engagement as essential processes that improve the effectiveness and longevity of development projects, rather than as obstacles to development. Overall, the IFC needs to address the policy gaps identified in the PSs to improve development outcomes and protect the rights of project affected communities.

For a more in-depth look at the findings and recommendations, please see the full report here: 

English 

Spanish

[1] The three projects apply the IFC’s PSs. In the projects approved prior to the IDB’s Invest Sustainability Policy, such as the case of Generadora San Mateo and San Andrés, IDB Invest recommended that clients use IFC’s Performance Standards since the IDB Invest Policy allowed the use of third-party policies.