(Kate Woodsome, www.huffintonpost.com, January, 10 2014) – The World Bank’s private lending arm failed to apply its own ethical standards in disbursing millions of dollars to a palm oil company accused of turning a region of Honduras into a war zone, according to an internal bank investigation.
The audit, released Friday by the World Bank’s Office of the Compliance Advisor Ombudsman, says IFC staff underestimated the social and environmental risks related to the security and land conflict associated with its investment in palm oil giant Corporacion Dinant.
The audit and the bank’s response to it are a major test of World Bank President Jim Kim’s pledge to learn from mistakes made in the multi-billion dollar business of providing loans and risk guarantees for IFC private sector projects.
That “risk environment” involved the killing, kidnapping and forced eviction of farmers, journalists and lawyers in Honduras’ northern Aguan Valley. Washington-based Rights Action and other advocacy groups accuse Dinant, owned by powerful businessman Miguel Facusse, of turning the area into a war zone. The CAO cites allegations that 102 members of subsistence farming associations in the Aguán Valley have been murdered in the last four years. Forty of the deaths were associated with Dinant property or its security guards. Dinant denies wrongdoing and says its staff are the victim of attacks by armed farmers.
See also:
Audit slams World Bank agency – Al Jazeera
CSO response to the CAO investigation into IFC investment in Corporación Dinant, Honduras
CAO audit of IFC investment in Corporación Dinant, Honduras
IFC response to CAO audit of IFC investment in Corporación Dinant, Honduras