News / 16 June 2014

FMO investigates complaint about Barro Blanco dam, Panama

For the very first time, the expert panel of the independent complaints mechanism of the Dutch development bank FMO will handle a complaint. It was filed on May 5 by residents of the area where the Barro Blanco dam is currently being built. These people form part of the indigenous Ngäbe-Buglé tribe. They feel that FMO has not adhered to its own social and environmental standards when they lent 25 million US dollars to build the dam. Anouk Franck of Both ENDS has been keeping a close eye on the situation.

What is the complaint about?
“The complaint is that the FMO has failed to obtain permission from local residents based on sufficient information. This is called free, prior and informed consent. It is a right that is incorporated in the UN Declaration on the Rights of Indigenous Peoples. According to some of the Ngäbe-Buglé, represented by environmental and human rights organization M-10, this right has been violated in the planning and construction of the Barro Blanco dam. The reservoir of the dam, which will generate electricity, is partly located on indigenous land. This means that houses, schools and other important places (for religious, cultural and archaeological reasons)  will be inundated when the dam is finished. Some Ngäbe will be forced to move from the land where they have lived for generations. The ecosystem of the river Tabasará will also change dramatically. That is disastrous for both the food security of the local residents and the landscape and local biodiversity.”


What does the complaints mechanism do exactly?

“The independent complaints mechanism of FMO came into force in January 2014. FMO is the first bilateral European development bank to establish such a mechanism, which motivated the German development bank DEG to join the initiative. With the mechanism, people who feel disadvantaged by investments of FMO have the possibility to file a complaint. The mechanism has no legal force, but serves as an instrument to resolve conflicts between stakeholders and FMO. The expert panel of the complaint mechanism will first discuss the matter with both parties and go through all available documentation now. The panel will then decide to either start a dialogue or do an investigation. Finally, the panel will write a report with recommendations. The complaints office of FMO will ensure the implementation of these recommendations. All in all the process could take months.”


How important is this decision?

“The fact that independent experts will look into the complaint of the Ngäbe is of great importance. The mechanism of FMO is the first independent complaints mechanism of any national development bank in Europe. Although the mechanism is not perfect yet, it's an important step towards a world where banks and companies can be held accountable for the impact of their activities on people and their environment. Hopefully the complaint will be handled quickly, because the construction of the dam is already reaching the final phase. The Ngäbe-Bulgé will remain in the provisional camp that they have set up on the river banks. By doing so, they hope to prevent the construction company from entering their land.”


7 May 2014: Indigenous people file complaint against FMO for funding of Barro Blanco dam, Panama

3 March 2014: Parliamentary questions about construction Barro Blanco dam in Panama

18 Feb. 2014:  Situation tense for indigenous Ngäbe people near Barro Blanco dam

14 Feb. 2014:  Filing a complaint with the FMO?

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