IFC: investment of $45 billion blindfolded
“Quite shocking”, said Anouk Franck from Both ENDS. “The International Finance Corporation is unaware of the social and environmental consequences of their investments in private enterprises in developing countries and emerging economies. This was observed by the Ombudsman of the IFC itself.”
No checks
The IFC is the worlds’ largest credit bank which focuses on businesses in developing countries. At the moment, IFC has a loan portfolio of approximately $45 billion. The bank issues credits only when the investments meet all kinds of requirements. These conditions were set by the IFC itself in 2006 and can be summarized as “do no harm”, meaning that the impact of the activities arising from the credit must not be harmful to the people or the environment where companies operate. It’s a good thing that IFC sets such requirements, but they must also be complied with. Whether that happens is unknown, because the IFC carries out almost no checks on the consequences. Therefore, the IFC is investing blindfolded.
Stricter rules
Anouk Franck: “Last year IFC imposed stricter rules on itself. They are now more extensive and state that its investments should have a positive impact on the development outcome. But this makes little sense without checks. The IFC Ombudsman states in his report that he even found examples of companies that did not meet the necessary lending requirements.
They were thus guilty of breach of contract, but were still granted more IFC credits.
Civil society pressure
The Ombudsman began his investigation after civil society organizations had expressed their concerns about the enormous growth of IFC investments. The bank increasingly made use of intermediaries such as commercial banks, insurance companies, micro financiers and asset managers for providing credit. This obviously has not helped rule compliance.
IFC should improve
Dutch investments in developing countries also receive IFC loans. My opinion is that the companies that are financed by the IFC should contribute to sustainable development. Therefore the IFC should take off its blindfold, comply with its own rules and carry out checks on the consequences of its lending.
Anouk Franck is programme officer for policy development and specialized in International Financial Institutions.
For more information see the Ombudsman report and the summary of that report made by our partner Eurodad.
Read more about this subject
-
Instalink / 21 november 2024
-
Blog / 19 november 2024
Building Monitoring, Evaluation and Learning systems based on mutual accountability and trust
Just before summer, on June 27th we participated in a panel discussion on inclusive conservation in a learning event organized by WWF Netherlands. Several organizations joined in a discussion on inclusive, decolonial, rights-based, and community-led approaches in conservation. We discussed the barriers, gaps and opportunities in how power is shared, inclusion promoted, and accountability practiced in our work. The question raised was: as Dutch-based organizations, are we doing enough to really work inclusive? In 2023 Both ENDS started an Examination of Power process to research how power is experienced in our partnerships. I share a couple of practical tips and insights that I feel might benefit the greater conversation around Monitoring, Evaluation and Learning (MEL) in our sector.
-
Instalink / 18 november 2024
-
Blog / 18 november 2024
The global rise of authoritarian regimes demands global strategies
The global funding landscape for civil society movements is changing, and is increasingly faced with policies that restrict funding streams, limit philanthropic work, and silence critical voices. These are not incidental shifts but part of a broader pattern that erodes the support for those international networks and movements under the guise ‘necessary financial cuts’, ‘aid reform’ or ‘efficiency’.
-
Publication / 18 november 2024
-
Instalink / 16 november 2024
-
Instalink / 15 november 2024
-
Event / 15 november 2024, 12:50 - 16:45
#BothENDSatCOP29 Side Events
Both ENDS’ participation at COP29 includes three critical side events that will highlight gender-just climate finance, locally-led adaptation, and multilateral approaches to a just energy transition and industrialisation in the Global South.
-
Instalink / 14 november 2024
-
Instalink / 13 november 2024
-
Instalink / 12 november 2024
-
Press release / 12 november 2024
Ruling climate case Shell: "Shell has an obligation to protect human rights."
The Hague, 12 November 2024 - The court has ruled in Shell's appeal in the Climate Case that Milieudefensie won against Shell in 2021. The Court of Appeal has ruled that the oil and gas giant has a responsibility to reduce its emissions, but has not imposed a reduction obligation.
-
Instalink / 12 november 2024
-
Instalink / 11 november 2024
-
Press release / 11 november 2024
Both ENDS's response to government letter on future cooperation with civil society organisations
DEN HAAG, 11 November 2024 - Today, the Dutch government published its policy on future cooperation with development organisations, both in the Netherlands and abroad. PVV minister Reinette Klever is putting the axe to this funding: she has decided to cut the budget for aid to international civil society by more than two-thirds: from roughly €1.4 billion to €0.4 billion in the period 2026 to 2030. This has major implications for critical voices at home and abroad, at a time when civic space for organisations around the world is already shrinking. Karin van Boxtel, director of environmental and human rights organisation Both ENDS: ‘This is an unprecedented step in exactly the wrong direction. Civil society organisations are essential for sustainable and social change worldwide. International movements fulfil multiple, indispensable roles: as a watchdog of the rule of law, as a driver of change, and as a counterforce against authoritarian tendencies. The weakening of support for these roles is a telling signal.’
-
News / 11 november 2024
Kenya Terminates Bilateral Investment Treaty with the Netherlands
The government of Kenya has officially terminated its bilateral investment treaty (BIT) with the Netherlands, marking a significant win for economic justice and environmental protection. Kenya’s decision reflects a growing global trend of rethinking outdated treaties that often prioritize corporate interests over public welfare. The Dutch Minister for Foreign Trade and Development recently confirmed that Kenya unilaterally ended the treaty in December 2023, rendering it inoperative from 11 June 2024. Kenya now joins South Africa, Tanzania, and Burkina Faso as the fourth African country to terminate its BIT with the Netherlands.
-
News / 9 november 2024
Why is the Dutch climate case against Shell important to our partners in the Global South?
On November 12th, a new ruling will be issued by the Court of Appeal in The Hague in the climate case against Shell, in which Both ENDS is a co-plaintiff. Ahead of this ruling, we asked our partners why this Dutch lawsuit is important for the Global South.
-
Instalink / 3 november 2024
-
News / 1 november 2024
Both ENDS at COP29: advocating for gender just climate finance
On November 11th, the 29th UN Climate Conference will start in Baku, Azerbaijan. Just like previous years, Both ENDS will be there to advocate for local access to climate finance, and to support our partner organisations in their advocacy work. How do we do that, and what are our hopes (and worries) about this 29th edition of the UNFCCC COP? We asked Marius Troost, who will be joining COP29 together with Daan Robben.
-
Instalink / 31 oktober 2024