Latin America & the Caribbean
Guatemala / CIFI-01/Santa Cruz
Corporacion Interamericana para el Financiamiento de Infraestructura (CIFI) was established in 2001 as a non-banking financial institution to provide financing to small and medium infrastructure projects across Latin America and the Caribbean. IFC's project consists of the implementation of CIFI’s business plan, including expected asset growth and operational consolidation, as well as potential access to long term funding through the international capital markets. Through its portfolio, CIFI made an investment in Hidroelectrica Santa Cruz for the Cambalam hydropower project located in Santa Cruz, Guatemala.
In July 2015, a group of community representatives filed a complaint on behalf of themselves and other community members in Santa Cruz, alleging that the Santa Cruz project was never properly consulted with the communities, and that community members’ opposition to the project has been met with violence and repression on the part of the company and the government. The complainants contend that the project will have an impact on water resources which they consider of significant cultural and recreational value. They also state that the land acquisition process was not transparent.
CAO found the complaint eligible for further assessment in August 2015 and an assessment visit was conducted in October 2015. During the assessment, the company expressed its willingness to participate in a dispute resolution process convened by CAO, however, the complainants are of the view that it is not worth initiating a new dialogue process with the project operator in light of the violent events and damages suffered. Hence, in accordance with CAO’s Operational Guidelines, the case has been referred to CAO’s Compliance function.
CAO released a compliance appraisal report in August 2016. The compliance appraisal has concluded that an investigation is warranted in response to this complaint.
Terms of Reference for this compliance investigation were published in January 2017 and the investigation is underway.
Status as of January 3, 2017
- Project Name & Number
- CIFI 26031
- Global Financial Markets
- Corporacion Interamericana para el Financiamiento
- Latin America & the Caribbean
- Environmental Category
- $20 million A loan & $10 million equity investment
- Eligible: Completed
- Assessment Period: Transferred
- Under Appraisal: Completed
- Under Audit: In Process