Haiti: Grupo M and CODEVI II-01/Zone Franche de Ouanaminthe

Date Filed
12 Mar 2020
Status
Open
Phase
Dispute Resolution (DR), Compliance
Country
Haiti

Case Tracker

Eligibility
Eligibility
Assessment
Assessment
Dispute Resolution
Mediation
Compliance
Appraisal
October 19, 2023-April 03, 2024
CURRENT Status
Appraisal (COMPLIANCE)
October 19, 2023-April 03, 2024

Complaint Overview

Complainant

Farmers from the Ouanaminthe Special Economic Zone.

Concerns

Economic dislocation, loss of livelihood, waste management.

Cross-Cutting Issues
Risk Management Land Resettlement Land Social Order / Conflict Unfulfilled Commitments Loss of Livelihoods Access to Information Policy

Project Information

Region
Latin America & the Caribbean
Institution
IFC
Name & Number
Grupo M and CODEVI II 34687
Company
Grupo M SA
Sector
Manufacturing
Department
Manufacturing, Agribusiness & Services
Category
B
Commitment

US $20 million A Loan and Internal cash generation

Synopsis

Project Overview

At the time CAO received the complaint, IFC had an active project in Haiti with Grupo M and its fully owned subsidiary CODEVI – one of the largest garment manufacturing operations in the Central America and Caribbean region. The project supported CODEVI in an expansion program that included the construction of a new facility for the assembly of woven garments and the acquisition of specialized machinery for dry garment assembly and processing operations. The project was to be undertaken in two new buildings to be constructed on land already owned by Grupo M at CODEVI.

Complaint

In March 2020, a complaint was submitted to CAO in relation to the project by a local individual on behalf of 174 farmers’ households residing in and near Ouanaminthe, Haiti. The complaint raised concerns regarding the economic displacement of the complainants due to CODEVI’s construction of their facilities in 2002. According to the complaint, despite commitments made in a ‘social compensation plan’, they had yet to receive the replacement land committed to them and had not obtained adequate compensation for their losses. The complaint also alleged improper waste disposal by CODEVI, leading to pollution.

CAO Action

In April 2020, CAO found the complaint eligible and conducted an assessment. During the assessment, the complainants and the company agreed to engage in a voluntary dialogue process to try to resolve the dispute.

Throughout 2021, CAO engaged the parties in several online activities, including technical training for the complainants, capacity-building sessions to clarify questions related to the dispute resolution process, and the use of technology in the process. The parties initiated a discussion about the ground rules to guide their engagement, which were first discussed separately and online in early 2022.

Once COVID-19 travel restrictions and security measures were lifted, CAO met with the parties in person in May 2022 and facilitated bilateral and joint meetings. During these meetings, the parties continued their conversations regarding the content of the ground rules document but were unable to reach agreement on that matter. From June 2022 to April 2023, CAO continued to work with the parties virtually to discuss the areas of disagreement.

Despite the parties' efforts to resolve the issues raised in the complaint, the parties could not reach an agreement. At the request of the complainants, and in accordance with the CAO Policy, in October 2023 the case was transferred to CAO’s Compliance function for appraisal. The Dispute Resolution Conclusion Report is available in English and Creole.

In April 2024, CAO concluded the compliance appraisal process with a decision to conduct a compliance investigation of IFC’s environmental and social performance in response to the complaint.

Status

In accordance with the CAO Policy, IFC Management may request that the IFC Board review CAO’s decision to investigate the case within 10 business days from the date the appraisal report was circulated (April 3, 2024). If a request to review is received from IFC, CAO will post a notice on this webpage, stating that its decision to investigate is subject to the review of the Board. The review request or the appraisal report will not be published until the Board review process is complete. If IFC Management does not file a review request within this period, CAO will publish the appraisal report and proceed with the investigation. 

Status as of April 4, 2024

Case Documents

  • Complaint
    Haiti / Grupo M and CODEVI II-01
    Mar 12, 2020
    English
    Haiti / Grupo M and CODEVI II-01
    Assessment Report(s)
    CAO Assessment Report - Haiti
    Dec 01, 2020
    English
    CAO Assessment Report - Haiti
    CAO Assessment Report - Haiti
    Dec 01, 2020
    Creole
    CAO Assessment Report - Haiti
    IFC Formal Response
    Dec 01, 2020
    English
    IFC Formal Response
  • Dispute Resolution

    Conclusion Report
    CAO Dispute Resolution Conclusion Report - Haiti: Grupo M and CODEVI II-01/Zone Franche de Ouanaminthe
    Oct 19, 2023
    English
    CAO Dispute Resolution Conclusion Report - Haiti: Grupo M and CODEVI II-01/Zone Franche de Ouanaminthe
    CAO Dispute Resolution Conclusion Report - Haiti: Grupo M and CODEVI II-01/Zone Franche de Ouanaminthe
    Oct 19, 2023
    Creole
    CAO Dispute Resolution Conclusion Report - Haiti: Grupo M and CODEVI II-01/Zone Franche de Ouanaminthe
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