News / 10 July 2020

Honduran NGOs call on FMO not to invest in controversial bank

Dutch development bank FMO is considering investing in the controversial Ficohsa bank in Honduras. The bank has close ties with the elite in Honduras, which holds considerable power in politics, the (para)military and the business community. Last Wednesday, a number of Honduran organisations, including the indigenous organisation COPINH – whose leader Berta Cáceres was murdered in 2016 – sent a letter to the FMO management. The letter, signed by forty organisations including Both ENDS, calls on FMO not to do business with this bank.

Ficohsa would act as a financial intermediary for FMO, borrowing money from FMO to loan to other companies. Through this construction, it is unclear where FMO's money eventually ends up and how FMO can be held accountable for it.

Corruption and violence

According to the NGOs, a bank like FMO should distance itself from working with this bank: members of the elite in Honduras are accused of mafia practices, corruption and violence, and Ficohsa itself is suspected of corruption. Daniel Atala, who has been charged for alleged involvement in the murder of Berta Cáceres, is related to Ficohsa's CEO. Moreover, palm oil company Grupo Dinant used to be one of Ficohsa's most important clients. Grupo Dinant is under fire internationally for serious human rights violations committed at its plantations, resulting in the killing or death by other means of several members of local communities.

Invest in sustainable initiatives in Honduras

For Both ENDS it is important to support the call from the Honduran organisations. After the lessons it could have learned from funding the Agua Zarca project in Honduras, FMO should realise that other forms of funding are required. Indigenous and other communities in Honduras themselves have many ideas about what they need to develop further. These are the kinds of initiatives that development banks like FMO should be supporting, rather than investing in a controversial bank like Ficohsa.

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