News / 11 May 2016

Arrest of DESA staff member for murder of Berta Cáceres seems last straw for FMO

The Dutch development bank FMO and the Finnish FinnFund announced this week that they are seeking ‘a responsible and legal exit’ from the Agua Zarca project in Honduras. Last week, it was reported that four suspects had been arrested in connection with the murder of human rights activist Berta Cáceres, who opposed the project for many years. One of those arrested is the manager for social and environmental affairs of DESA, the company implementing the Agua Zarca project. Because the company is a direct client of FMO and FinnFund, the banks consider the arrest good reason to take action. 

Foto: - Agua Zarca militarization

Many years of protest

FMO's statement is a step in the right direction for the bank. The organisation led by Berta Cáceres, the Council of Popular and Indigenous Organizations of Honduras (COPINH), has been protesting against the controversial hydro project since the plans were first revealed in 2013. Together with other organisations, including a number of Dutch NGOs, COPINH has been calling for investors in the project to withdraw their support for DESA.


Intimidation and repression

The Agua Zarca project, in de Gualcarque River, is being implemented without the approval of the local population being acquired according to international standards for Free Prior Informed Consent (FPIC). Since 2013, communities and groups that oppose the project have been silenced and protests have been violently crushed, resulting in several murders. The murder of internationally known human rights defender Berta Cáceres – according to COPINH, one of the six murders directly related to Agua Zarca – has increased the pressure on FMO and other investors to withdraw from the project.


Import role for the Netherlands

We expect FMO to see its decision through and terminate its involvement in Agua Zarca project speedily, responsibly and definitively. Together with the Dutch government, the bank must help ensure that local communities and families of the victims receive fair compensation. The Dutch government has also taken on the important role of ensuring through diplomatic channels that the Inter-American Commission on Human Rights conducts an independent enquiry into the murders of Cáceres and the other victims. In addition, it is important that the Netherlands continues to exert pressure on the Honduran government to put a stop to the recurring violence and human rights violations. The violence continues; since the last reports by FMO, people have found themselves in immediate danger and thus have to be protected.


No business as usual

FMO’s withdrawal from Agua Zarca is a first sign that the bank realises that funding projects in areas where human rights are systematically violated can no longer go on as ‘business as usual’. After the bank’s definitive withdrawal from the project, it needs to make radical changes in policy to prevent similar situations, not only in Honduras, but everywhere the bank invests.


Sustainable development?

Together with its main shareholders, including the Dutch government, FMO needs to examine whether its activities are still in line with its development mandate. What kind of development most closely responds to the needs of the people the bank ultimately aims to help? How can it involve these people in its decision-making processes? And what social and environmental criteria need to underpin those processes to prevent violations of human rights and damage to the environment? Only if these questions are at the centre of policy can FMO really achieve its mission of sustainable and inclusive development. 


update 20 May 2016: Letter from BankTrack, Both ENDS, Oxfam Novib and SOMO to FMO's sharoholders.  

11 May 2016:Letter from BankTrack in reaction to FMO's statement

9 May 2016: FMO's statement


Earlier news items on this site about the Agua Zarca-project:

21 April 2016: Honduran Indigenous activists visit Europe to call for action

16 March 2016: FMO's suspension of activities in Honduras is just a first step

5 March 2016: Brave human rights defender Berta Cáceres murdered

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