CAO Cases

Arne Hoel, The World Bank

Sub-Saharan Africa

Togo / Togo LCT-01/Lomé

Complainant
Collectif des personnes victimes d’erosion côtière
Date Filed
March 09, 2015
Concerns
Land and livelihood
Case Status
Open - Compliance
 

Synopsis

Project Overview 

IFC has an active project with Lomé Container Terminal SA, a locally incorporated company which was awarded a 35-year concession by the Government of Togo to develop, construct, and operate a greenfield container terminal within the Port of Lomé in Togo. IFC invested €82.5 million for its own account in 2011, and mobilized the balance of €142.5 million from other lenders. The project is classified as Category A. A follow-on investment of €10 million from IFC’s own account was approved in August 2015 to contribute to the financing of additional equipment.

 

In March 2015, a complaint was lodged with CAO by the Collectif des personnes victimes d’erosion côtière—a group of riverine settlers who claim to be negatively impacted by the construction of the project. The complainants alleged that the project is causing land erosion issues in their communities and that they were not consulted or informed about the project. Issues related to the project’s Environmental and Social Impact Assessment (ESIA) were also raised.


 

CAO Action

CAO found the complaint eligible for further assessment in March 2015 and conducted an assessment visit in June 2015.  During the assessment, there was a lack of consensus amongst the parties to engage in a CAO facilitated dispute resolution process.  In accordance with CAO’s Operational Guidelines, the complaint was therefore referred to CAO Compliance for appraisal. After completing the compliance appraisal in November 2015, CAO concluded that the issues raised warranted further investigation.

 

CAO’s compliance investigation was released on October 20, 2016 and made a number of findings in relation to IFC’s appraisal and supervision of the environmental and social (E&S) risks and impacts of the project:

 

IFC’s E&S Appraisal of the Project


- Review of the client’s E&S Assessment

CAO notes that IFC’s E&S review did not identify coastal erosion as a risk of the project, although the ESIA acknowledges potential erosion impacts during construction and describes the history of coastal erosion since the port was constructed in the 1960s. CAO finds IFC non-compliant with the 2006 Sustainability Policy on this issue. Further, CAO finds that Performance Standard (PS1) requirements in relation to cumulative impact assessment were applicable and should have been addressed expressly in IFC’s E&S review. CAO also notes that IFC did not review the credentials and experience of the consultants who prepared the ESIA, nor the methodology used to assess the project’s potential impacts on coastal erosion. Considering these shortcomings, CAO finds that IFC’s pre-investment E&S review of the project was not compliant with the 2006 Sustainability Policy.

- Disclosure and Consultation

CAO notes that IFC’s review of the client’s disclosure and consultation focused on the two groups that were economically and/or physically displaced by the project. IFC did not assure itself that information was disseminated by the client to other potentially affected communities in a manner that met the requirements of PS1. The lack of consultation and disclosure of information to communities living within the area of influence, did not meet IFC’s PS1 requirements.

- Action Plan

CAO notes that the ESIA describes mitigation measures to be taken regarding the erosion risk, but the Action Plan agreed between IFC and its client did not include such actions. CAO finds IFC to be non-compliant with the requirement to ensure that the Action Plan meets the requirements of PS1. CAO also notes that IFC did not assure itself that the client disclosed the Action Plan to affected communities or that it included a structure for reporting to affected communities.


IFC’s Supervision of the Project

CAO acknowledges that IFC and its client agreed on actions regarding the project’s impacts on coastal erosion in February 2016. However, CAO finds these actions insufficient in several respects.

First, these agreed actions do not represent a timely response to the issues, coming more than three years after the commencement of construction and more than two years after IFC became aware of concerns regarding the project’s impacts on coastal erosion. 

Second, while welcoming the Memorandum of Understanding (MoU) between the client and an academic institution to fund research on coastal erosion, CAO finds that this agreement does not provide sufficient assurance that the analysis will meet the requirement for environmental assessment by the client under PS1 (paras 4ff). CAO also notes that there is no timeline for the production of this research.

Third, the agreed actions do not specify the need for consultation and disclosure required by PS1 (paragraph 20ff).

Fourth, IFC has not sought assurance that the revised Action Plan has been developed following consultation with, or disclosure to, affected communities as required by PS1. Similarly, the revised Action Plan lacks a mechanism for external reporting (paragraphs 16 & 26).

Fifth, IFC’s decision to rely on the Government and Port Authority of Lomé (PAL) to handle the concerns raised by the complainants was not supported by an appropriate assessment of their commitment or capacity to address the issues. It also lacked a framework for monitoring or follow up that would provide feedback on whether concerns regarding project related impacts were being addressed.

In this context, CAO finds that IFC has not assured itself that the client is responding “to community concerns about the project” or engaging in consultation “on an ongoing basis as risks and impacts arise”, as per the requirements of PS1. Further, CAO finds that IFC has not provided advice which would bring the client back into compliance as per the Sustainability Policy.

All documents relating to this case are available under "View Documents" below.

 

Status

CAO is monitoring IFC’s actions in response to the investigation findings and will issue a monitoring report in early 2018.

 

Status as of November 9, 2017

 

Project information

Institution
IFC
Project Name & Number
Togo LCT 29197
Department
Infrastructure
Company
Société Lomé Container Terminal
Sector
Port and Harbor Operations
Region
Sub-Saharan Africa
Country
Togo
Environmental Category
A
Commitment
$116.21 million

Case Tracker

Ombudsman

  • Eligible: Completed
  • Assessment Period: Transferred

Compliance

  • Under Appraisal: Completed
  • Under Audit: Completed
  • Monitoring: In Process