AES Sonel is the privatized integrated national electric utility of Cameroon. Upon privatization in 2001, AES Corp. purchased 56% of the shares of the company, and AES Sonel was granted a 20 year concession for distribution, transmission, and generation of electricity throughout Cameroon. IFC has invested EUR 70 million in AES Sonel to renew and refurbish the power company’s existing generation, transmission, and distribution assets. The project has been financed partly through a EUR 240 million facility from a syndicate of Development Financial Institutions comprising AfDB, DEG, EIB, Proparco, Central African Development Bank and IFC.

CAO received a complaint in February 2013 raising labor issues, specifically regarding demotion during employment and related benefits that the complainant believes are due.  

CAO found the complaint eligible in March 2013.  Following an assessment of the issues with the relevant parties, the company and the complainant engaged in a voluntary mediation process, starting with a joint meeting in June 2013. CAO continued to seek resolution through this process through December 2013.  The substantive points of the mediation are confidential in nature. However, the dispute resolution process concluded on January 9, 2014 and the case was transferred to CAO Compliance for appraisal.

CAO’s appraisal of the case considered IFC’s due diligence and mandate with respect to the project and whether IFC acted consistently with its policies and performance standards in identifying and responding to environmental and social risk in relation to the investment.  The report notes that while the issues raised by the Complainant as referred to CAO Compliance are no doubt important at an individual level, the information available does not support the conclusion that the project raises substantial concerns regarding environmental and/or social outcomes. Similarly, CAO’s review of IFC’s approach to the appraisal and supervision of this project has not identified issues of systemic importance to IFC that would warrant an investigation.