Election of the president of CABEI: key for human rights in the region

On November 17, the Assembly of Governors of the Central American Bank for Economic Integration (CABEI) will elect a new president for the next five years, at a critical moment for the institution and for the future of Central America.

CABEI is a multilateral development financial institution and one of the main sources of financing in Central America. In 2022, the Bank, whose objective is to promote the social and economic development of the region, approved operations for projects worth more than 3 billion dollars, mostly destined for the public sector.

However, at times, the Bank appears to have strayed from its objectives. The CABEI has provided funds without adequate supervision and has approved loans that may have contributed to human rights violations. Furthermore, since Dante Mossi was elected president in 2018, the Bank has weakened its institutional controls, including by removing its internal auditor, and has increased financing to authoritarian governments such as those of Nicaragua and El Salvador.

CABEI has 23 active loans to finance the government of Nicaragua, for a total of more than 3.5 billion dollars, approximately 28% of the Bank’s total loan portfolio. Since April 2018, when the brutal repression of the Nicaraguan Government against the protesters unleashed a profound human rights, political and social crisis that continues to worsen, CABEI has approved projects worth more than 2.6 billion dollars for the Ortega regime. Despite the severity of the crisis, the Bank does not appear to have taken adequate and sufficient measures to mitigate the risk of misuse of funds or violation of its policies.

For example, the Bank approved funds for the “expansion of the National Police of Nicaragua,” and he just canceled the financing in March 2020, almost two years after it became evident that the National Police was involved in serious human rights violations.

In November In 2020, the United Nations Green Climate Fund (GCF) approved the financing proposal presented by CABEI for the Bio-CLIMA project, which seeks to reduce deforestation and strengthen resilience in Bosawás and the San Juan River biosphere. located in indigenous and Afro-descendant territories of Nicaragua. He Total budget for Bio-CLIMA it is 116 million dollars, of which 64 million come from the Green Climate Fund and more than 44 million from CABEI, which is also the entity accredited to carry out the project.

In July 2023, the Green Climate Fund Board of Directors temporarily suspended the first disbursement for the project, pointing out that in some instances CABEI had not “complied with the policies and procedures” of the Green Fund. The decision arises from an investigation initiated by the Independent Redress Mechanism of the Green Fund, after receiving a complaint by the indigenous and Afro-descendant communities, alleging that the project had been approved without guaranteeing their rights to free, prior and informed consultation.

In the case of The Savior, the Bank has 14 active operations, with approved funds totaling more than 1.6 billion dollars. These include loans to government entities involved in human rights violations during the so-called “war against gangs” promoted by the Government of President Nayib Bukele, such as the National Civil Police, the Ministry of Defense, the Attorney General’s Office and the prison system. In a report Published together with the human rights organization Cristosal, Human Rights Watch documented that security forces have committed widespread human rights violations, such as arbitrary detentions, forced disappearances, and torture under this security policy.

In Honduras, in 2012, CABEI approved 24 million dollars for the Agua Zarca hydroelectric project, on the Gualcarque River, in the northwest of the country. The loan provided funds to the company Desarrollos Energético SA (DESA), which, according to an internal CABEI audit, had “no experience in energy generation projects.”

The Agua Zarca project was also affected by other serious human rights problems that should have alerted Bank authorities. Indigenous organizations and environmental defenders, particularly the Civic Council of Popular and Indigenous Organizations of Honduras (COPINH), led by prominent indigenous leader and environmental rights activist Berta Cáceres, opposed the construction of the dam, alleging the lack of adequate consultation with the communities.

COPINH members faced constant harassment and intimidation due to their activism. Tragically, Cáceres was murdered in March 2016. A court convicted David Castillo, former director of Energy Development, as co-author of her murder and maintained that Cáceres was murdered for her opposition to the construction of the dam. Castillo, who was a public official at the National Electrical Energy Company of Honduras at the time Desarrollos Energéticas obtained the concession, also has been investigated for his alleged collusion with Honduran officials to obtain a permit for the dam without adequate and complete environmental studies.

Central America faces serious human rights challenges that affect the population and push many to seek safety and protection abroad, especially in the United States. These challenges include high levels of crime and violence, serious democratic setbacks especially in El Salvador and Guatemala, and the systematic repression of the Government of Daniel Ortega in Nicaragua. Corruption, poverty and inequality, government attacks against the press and civil society, as well as the effects of climate change exacerbate these problems.

In this context, CABEI can and must play a fundamental role in helping the region overcome some of these challenges and contribute to the enjoyment of the social and economic rights of the population.

The Board of Governors should ensure a transparent and fair selection process to appoint a president capable of restoring trust and transparency in the Bank and strengthening its accountability mechanisms. This would ensure that the Bank effectively fulfills its role as a driver of the development of Central America, a task that may be crucial for the future of human rights in the region.

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