Raising the bar on Human Rights in Public Development Banking
by FORUS, Devex, Rights in Development, agencies
It is time public development banks put their money where our future lies, by Iara Pietricovsky de Oliveira, Eleonore Morel & Tasneem Essop | International Forum of NGO Platforms (FORUS)
The world faces the gravest global health crisis in a century, intertwined with the rising social and economic inequality, the sixth mass extinction of species and record-breaking ecological and climate disasters. Against this backdrop of global upheaval, we call on public development banks meeting this week for the Finance in Common Summit to become part of the solution towards building a just, equitable, inclusive and sustainable world.
To do so, they must commit to devoting their considerable financial resources and influence to achieving a safe, healthy and prosperous future for all. That is why today more than 320 civil society organisations signed a joint letter urging the public development banks gathered at the summit to transform their financing models.
The COVID-19 pandemic is only the latest example of the multi-faceted crises our societies are confronted with and which could push 150 million more people into extreme poverty by 2021. It is time to address the root cause of such systemic crises, otherwise we risk dramatically increasing the plight faced by billions of people.
Women and girls, as well as those experiencing the cumulative impacts of various vulnerabilities, are affected the most and worst. Whatever the duration of this pandemic, the challenges the world is facing deserve global answers to meet the needs of local communities.
Public development banks should not repeat the mistakes of the past. They must seize the opportunity of the Finance in Common Summit to initiate a deep and rapid shift in the way they operate and place democracy, inclusiveness, equality, solidarity, and the common good at the core of their actions.
Public money should only be spent to promote the wellbeing of people and the planet. Not a single penny can go towards the violation of human rights, economic, social and cultural rights, or the rights of Indigenous Peoples, nor should it allow for the destruction of nature.
It is time public banks take a collective stand to stop money going towards fossil fuels and other sectors that fuel the climate and biodiversity crisis. We believe that achieving the Sustainable Development Goals, limiting global warming to 1.5°C by fully implementing the Paris Agreement and protecting nature should be the key drivers of action over the coming decade.
Through a rights-based approach and strong mechanisms for meaningful participation of civil society at all stages, from the development of policies to the evaluation of their impacts, public development banks should enhance the respect of human rights and promote community-led development.
Their direct and indirect operations should promote resilience-building and the development of essential and qualitative public services, support anti-corruption and anti-tax-avoidance efforts, and adhere to a “do-no-harm” principle so that their financing does not undermine climate and environmental objectives, increase the burden of debt, or expand inequalities.
To ensure accountability, the highest transparency standards, reporting guidelines, and risk and impact assessment methodologies must be applied by all public development banks and their intermediaries.
The current context is dire and highlights yet again the urgency of rethinking development finance. It requires thinking one step ahead; it's not only about how public money is being spent, it also means addressing the largely negative impacts that public-private partnerships have on communities.
These efforts must be supported by countries providing the right mandate, policies, measures and the necessary resources to public financial institutions.
The public development banks gathered at the summit should act immediately to transform their financing models, by adopting the commitments set out in our joint letter. Their public interest mandate must be clear, their governance transparent and accountable.
Civil society will continue to play its part to ensure that the response to the current global economic crisis brings economic, social and ecological transformation. If not now, when?
* Iara Pietricovsky de Oliveira, is president of the International Forum of NGO Platforms (FORUS), Eleonore Morel, chief executive officer of the International Federation for Human Rights (FIDH) and Tasneem Essop, is executive director of the Climate Action Network.
* Joint CSO Statement: http://forus-international.org/en/resources/193
Raising the bar on Human Rights at the European Investment Bank. (Devex)
The European Investment Bank (EIB) has been called on to change how it assesses the human rights impact of its projects, as a report from two NGOs released Monday argues the multilateral lender must be “deeply reformed” if it is to live up to its development potential.
The report, by Counter Balance and Bankwatch, follows an open letter from 15 civil society organizations last month calling for EIB to beef up its rights framework for those affected by its work.
Around 10% of EIB financing — €7.9 billion ($9.38 billion) in 2019 — goes to projects outside the European Union, including exposure in 43 of 59 least-developed countries and fragile states.
Citing lending in countries such as Laos and China, as well as projects that the NGOs say have required resettling or displacing people in Senegal and India, the report’s authors ask whether “EIB services did not spot sufficient risks related to human rights in these projects to trigger a dedicated assessment. Or is it simply that there was no human rights screening performed at all?”
The NGOs want EIB to adopt a new human rights strategy, including dedicated human rights due diligence screening by the bank itself before every project goes ahead.
“There is also room for the European Commission and European External Action Service to play a more active role in the appraisal process at the EIB,” the report states.
“Before approving a project, the Commission should ensure that the EIB has properly assessed human rights risks early in the project cycle, and it should oppose the project when red flags emerge.”
The bank’s spokesperson emailed that “EIB has never stopped assessing the human rights aspects of its projects,” adding that the current method of considering the “likelihood, frequency, and severity of human rights impacts” as part of the environmental and social assessment allows for an “interrelated analysis.”
At the same time, the spokesperson wrote that “the question of using stand-alone human rights assessments will.. be considered in our forthcoming review of our Environmental and Social Framework,” expected in the first half of next year. The review is a chance to “clarify and strengthen” language on the bank’s human rights obligations, the spokesperson wrote.
In their report, the NGOs argue that other shortcomings on transparency and anti-money laundering, as well as too few staff in low-income countries, mean that EIB would have to be “deeply reformed” before becoming the EU’s preferred development bank — one option now under consideration by EU countries.
The report and open letter are timed to coincide with this week’s Finance in Common summit of the world’s 450 public development banks, which NGOs have criticized for neglecting the rights of Indigenous people, human rights defenders, climate change and biodiversity goals, tax avoidance and illict finance.
(Towards Mandatory Human Rights Due Diligence: Under the UN Guiding Principles on Business and Human Rights companies have a responsibility to undertake human rights due diligence. However, 40% of the biggest companies in the world evaluated by the Corporate Human Rights Benchmark in 2018 failed to show any evidence of identifying or mitigating human rights issues in their supply chains. Until recently, legal developments have put an emphasis on promoting transparency, but there is growing momentum worldwide to require companies to undertake human rights due diligence).
http://www.devex.com/news/eib-eyes-human-rights-rethink-amid-criticism-98505 http://counter-balance.org/publications/ngos-urge-eib-to-raise-the-bar-on-human-rights-ahead-of-banks-summit http://bit.ly/3eKkEjC
Global development summit needs human rights focus, say 200 organizations from around the world. (Rights in Development)
In a letter addressed to the French Development Agency, over 200 organizations around the world are calling for the principles of a human rights-based and community-led development to be included and prioritized both in the agenda and in the outcomes of the Finance in Common Summit, a high-level gathering of all Public Development Banks, which will take place in Paris on 9-12 November.
From November 9th to 12th, 2020, the French Development Agency will convene the first global summit of all Public Development Banks (PDBs). Gathering PDBs from around the world, it is aimed to provide a collective response to global challenges, reconciling short-term responses to the Covid-19 crisis with sustainable recovery measures, redirecting financial flows towards sustainable development objectives.
The summit is highly relevant and timely, but for a truly comprehensive and inclusive dialogue, it should draw lessons from the past to shape the strongest future with full participation of the communities impacted by PDB projects and supporting civil society organizations.
In many instances, PDB supported activities have exacerbated poverty and inequality and human rights abuses such as reprisals against human rights defenders and forced evictions, without meaningful redress for affected communities.
The summit should include reflection and discussion on the importance of respecting international human rights standards in achieving sustainable recovery goals, including addressing human rights abuses widely documented in PDB supported investments and projects.
The summit should contend with the challenges of increased investment from PDBs lacking robust standards for human rights, social and environmental protection, climate change, and anti-corruption, or where those standards exist, how to address failures to follow them in practice.
The Covid-19 pandemic has highlighted and aggravated the failures of the health, social, and economic systems, requiring a deep rethinking of the way governments, PDBs, and other actors operate.
Several grassroots community groups and organisations have been calling on PDBs to ensure that the funding and support they provide for the Covid-19 response, and during the economic recovery period, respects human rights and leads to economic, social and environmental justice for those who are most vulnerable.
New impetus in attaining the core principle of “leave no one behind” is needed.
We welcome the opportunity to engage with PDBs during the summit to better serve the principles and goals of international human rights standards, the Paris Agreement, the Sustainable Development Goals (SDGs), transparency, and accountability.
To that end however, and as a matter of credibility and efficiency, it must be a priority to ensure human rights and community needs are explicitly discussed and part of the joint declaration foreseen at the end of the summit.
As stated by OHCHR last year: “with the most pivotal decade of SDG implementation ahead of us, human rights are not only the right way, but the smart way to accelerate progress for more equitable and sustainable development. Development is not just about changing the material conditions …. It is also about empowering people with voice … to be active participants in designing their own solutions and shaping development policy. … Empowering people means moving beyond purely technocratic solutions and treating people as passive objects of aid or charity. People are empowered when they are able to claim their rights and to shape the decisions, policies, rules and conditions that affect their lives.”
As SDGs are at the core of the summit, human rights and participation of communities are then key. That requires adapting the agenda and the expected outcomes. Our recommendations on ensuring an inclusive event follow:
1. Human Rights should be reflected in the core agenda of the summit, attendance and participation. As conceived, the research conference and summit do not appear to provide specific space to human rights defenders and community representatives. Commitment to public participation and protection of civil society space have long been recognised as essential to ensuring effective development.
Human rights and grassroots organizations, human rights defenders, and communities should guide the future of the development model, and therefore should be involved in organizing, contributing to the agenda, and participating in the summit. It is a matter of priority to have human rights defenders and communities directly impacted by PDB activities at the table.
2. The principles of a human rights-based and community-led development should be included and highlighted on the expected deliverables of the summit including research papers and collective statements. We encourage governments and PDBs to make a commitment to reinforce and strengthen the principles of human rights-based and community-led development in PDBs’ mandate and governance; policies and practices; internal culture and incentives; what projects and activities they support and invest in; and how they work with other PDBs, governments and key actors.
These commitments should lead to improvements, such as:
Full and free participation of directly affected communities in all PDB supported activities and projects, and free prior and informed consent for indigenous peoples.
Innovative approaches will have to be developed to address the closing space, risks and challenges for communities, human rights defenders and civil society to meaningfully participate in decisions that impact their lives, livelihoods, environment and resources. Zero tolerance policies against threats and reprisals by PDBs and their clients should be a basic requirement.
Identifying investments that are aligned with international human rights, climate protection, and SDGs, and reorienting investments towards sustainable development that respects these standards, while ensuring that the priorities and needs of marginalised persons are met.
Improving social and environmental requirements through inclusion of human rights standards. PDBs and their clients should adhere to human rights principles and standards enshrined in international conventions. Safeguard policies and procedures should ensure that activities financed directly or indirectly by PDBs, respect human rights, do not contribute to human rights abuse, and contribute to equitable, inclusive development that benefits all persons.
Developing and improving transparency, monitoring, oversight, grievance and accountability mechanisms to actively prevent PDB activities and investments from undermining human rights.
Ensuring private sector clients or partners also adopt high human rights and environmental standards, and do not avoid or evade taxes.
Development of common guidance by PDBs on ex ante human rights due diligence and impact assessments in project investments and in support for economic reform policies or programs. This includes identification of contextual and specific risks, prevention and mitigation strategies, and remedy in line with international human rights norms. Ensure that these assessments are developed in close consultation with affected communities, and are updated iteratively based on changing conditions and new information.
Developing coordinated approaches to ensure that PDB supported activities do not exacerbate debt or contribute to cutbacks in public expenditure that will negatively impact human rights or access to essential services for the most vulnerable.
As reiterated by the OHCHR, effective governance for sustainable development requires non-discriminatory, inclusive, participatory, and accountable governance.
With the most pivotal decade of SDG implementation ahead of us — and in the context of intersecting health, environmental, economic and social crises building greater integration and coherence between the development and human rights agendas will be key: “Human rights are not only a guide on the right way to achieve SDG implementation, but the smart way to accelerate more sustainable and equitable development”.
PDBs should open channels for the meaningful participation of communities, human rights defenders, and civil society groups in the appraisal, design, implementation, monitoring and evaluation of their projects and activities, as well as in their decision-making processes.
For these reasons, the agenda and the deliverable of the summit should duly reflect the centrality of human rights and community-led development to effective and sustainable development.
http://rightsindevelopment.org/news/letter-finance-in-common-summit-human-rights/ http://rightsindevelopment.org/human-rights-abuses-development-finance-reports/ http://www.business-humanrights.org/en/latest-news/finance-in-common-summit-global-south-movements-require-public-financial-institution-to-stop-funding-harmful-projects-for-communities-and-the-environment/ http://www.business-humanrights.org/en/blog/european-companies-should-stop-putting-profit-over-people-and-planet/ http://news.trust.org/item/20200908135525-kty7l
* Access the joint civil society letter via the link below.
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Debt relief for poor countries extended only for 6 months
by Jubilee Debt Campaign, agencies
Oct. 2020 (Jubilee Debt Campaign)
The G20 Finance Ministers have announced a 6-month extension to their Debt Service Suspension Initiative. They also indicated that next month they will discuss a common framework for debt reduction and indicated this will require the participation of private lenders but will only be available on a ‘case-by-case’ basis. They have not given any further details.
Reacting to the announcement of the 6-month extension Sarah-Jayne Clifton, Director of Jubilee Debt Campaign, said:
“The extension of the limited debt suspension scheme does little to tackle the profound debt and health crises impacting many of the poorest people in the world. The G20’s failure to include private and multilateral lenders in the scheme shows a disregard for the scale of the global South debt crisis and will mean over $3 billion in debt payments continue to leave the poorest countries every month. It is scandalous that private lenders are still making large profits out of poor countries at this time".
Reacting to the discussions over a future debt cancellation scheme Sarah-Jayne Clifton added:
“We welcome the G20 plans to discuss debt cancellation and private creditor participation at a special meeting in November. But this needs to be comprehensive, not case-by-case. Next month the G20 need to agree to cancel debt payments by the poorest countries to private, multilateral and bilateral lenders for four years. Doing so could save up to $180 billion to protect livelihoods and public services during the pandemic and support the recovery afterwards.”
Cafod, Christian Aid, Global Justice Now, Jubilee Debt Campaign and Oxfam have today released a report “Under the radar: Private sector debt and coronavirus in developing countries”. The briefing shines a light on the debt owed to private creditors by five African countries – Ghana, Kenya, Nigeria, Senegal and Zambia. It highlights the central role of financial corporations like BlackRock, HSBC, Goldman Sachs, Legal & General, JP Morgan and UBS.
Jubilee Debt Campaign’s briefing, “How the IMF can unlock multilateral debt cancellation” released earlier this week outlined how gold sales and Special Drawing Rights could be used to fund debt payment cancellation to multilateral institutions. The briefing argued this should be part of a comprehensive scheme which requires private lenders and governments to also cancel debt payments to them.
http://jubileedebt.org.uk/blog/the-g20s-debt-deal-letting-private-lenders-off-the-hook-again http://bit.ly/3m0xZY1 http://www.one.org/international/blog/common-framework-debt-treatment-game-changer/ http://taxjustice.net/2020/11/20/427bn-lost-to-tax-havens-every-year-landmark-study-reveals-countries-losses-and-worst-offenders/
Transparency International, Amnesty International and CIVICUS had written to the G-20 finance ministers ahead of their meeting in November to warn that the world is facing a crisis unlike any in the last century and that debt suspension is only a first step. Though the global economy has begun a gradual recovery with the reopening of some businesses and borders, the recovery has been sharply uneven.
The groups urged the G-20 nations to suspend debt payments at least through to the end of 2021, saying many of the poorest countries are still spending more on debt payments than on life-saving public services.
Oxfam International said it believes that the six-month extension was “the bare minimum the G-20 could do.”
“The failure to cancel debt payments will only delay the tsunami of debt that will engulf many of the world’s poorest countries, leaving them unable to afford the investment in healthcare and social safety nets so desperately needed,” said Jaime Atienza, an Oxfam official who manages debt policy.
Oxfam and other groups are also calling on private lenders and investment funds to make similar concessions for the poorest countries by suspending their debt repayments.
http://jubileedebt.org.uk/press-release/reaction-to-g20-debt-suspension-and-common-framework http://jubileedebt.org.uk/news http://www.un.org/development/desa/dpad/publication/un-desa-policy-brief-86-the-long-term-impact-of-covid-19-on-poverty/ http://gcap.global/news/statement-for-the-international-day-for-the-eradication-of-poverty-2020/
22 July 2020
$2.8 billion dollars are spent on debt payments a month by the world’s poorest counties, and right now the pandemic is spreading in the global south. Cases continue to increase across Africa, Bangladesh has 200,000 cases and rising, and El Salvador’s health system is close to collapse.
The Finance Ministers of the world’s richest countries met this weekend, ostensibly to agree what to do about the crisis, but not only did they fail to agree any new measures, they weakened what they’d already put in place.
What just happened? Back in April the G20 introduced the Debt Service Suspension Initiative (DSSI). This allowed up to 77 countries to apply for debt repayments to be suspended for 2020. The initiative only covers bilateral debts (country to country) but the G20 suggested a similar mechanism for multilateral lenders (like the world bank and IMF), and private lenders (like banks and hedge funds).
This debt suspension did not address the structural issues regarding debt, it only, as Jubilee Debt Campaign Director Sarah-Jayne Clifton said, ‘Kicked the can down the road’. The debts will have to be paid after 2022, leaving many countries in more debt, for longer.
This July the G20 met again. More than 800,000 people signed petitions, shared information, wrote to their MPs with a clear and straightforward message: Drop Debt. Save Lives.
Our demands are simple:
Cancellation of debt payments; Create measures to require private lenders and multilateral institutions to take part in any suspension or cancellation; and Debt payment cancellation to be extended for several years, until an international debt workout process has been established in order to bring debt down to sustainable levels.
Despite all of this, the G20 Finance Ministers failed to build on commitments made earlier this year where they pledged up to $12 billion in debt suspension. They failed to extend this to next year, and they failed to agree further cancellation in the face of the increasing spread of the virus.
The G20 have no longer called on multilateral lenders to suspend debt payments, as they previously did in April. They now “strongly encourage[d] private creditors to participate in the DSSI on comparable terms when requested by eligible countries”, but they have not announced any mechanisms to make private lenders comply.
Debt payments are crippling the pandemic response.
Currently, $92 million dollars a day is spent on debt repayment rather than saving lives in the middle of a global pandemic. The G20 must act.
The World Bank says the suspension of payments to other governments could save up to $11.5 billion in 2020 for 73 countries, though the G20 have said only $5.3 billion is being suspended so far. Those same 73 countries are due to pay private and multilateral lenders $19.9 billion over the same time period.
In the autumn world leaders are meeting again. When they do, we have to make sure they get the message that if countries in the global south are going to be able to fight this pandemic there must be more debt cancellation.
http://jubileedebt.org.uk/blog/g20-failures-and-our-next-steps http://jubileedebt.org.uk/press-release/imf-gold http://donate.savethechildren.org/en/takeaction/debt-relief-petition http://www.ituc-csi.org/g20-finance-ministers-meeting-fails http://www.ei-ie.org/en/detail/16969/global-unions-call-upon-the-world-bank-and-the-imf-to-support-public-investment http://gcap.global/news/joint-cso-letter-to-g20-07-2020/ http://www.thenewhumanitarian.org/analysis/2020/10/08/pandemic-debt-crisis-looms http://www.one.org/international/press/one-campaign-reacts-to-world-bank-annual-meeting/ http://www.one.org/international/blog/ripping-rulebook-debt/ http://www.one.org/international/blog/global-poverty-covid-19/ http://www.undocs.org/A/75/164 http://bit.ly/3iEbeX7 http://bit.ly/33yz0ja http://www.ohchr.org/EN/Issues/Development/IEDebt/Pages/IEDebtIndex.aspx
http://www.wider.unu.edu/publication/end-poverty-postponed http://www.wider.unu.edu/publication/precarity-and-pandemic http://bit.ly/3jc66d8 http://www.wider.unu.edu/publication/covid-19-intensifies-global-need-support-informal-workers-their-struggle http://www.un.org/sustainabledevelopment/poverty/ http://www.unwomen.org/-/media/headquarters/attachments/sections/library/publications/2020/gender-equality-in-the-wake-of-covid-19-en.pdf http://bit.ly/3m3GAZD http://data.unicef.org/topic/child-poverty/covid-19/
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