Collectif des personnes victimes d’erosion côtière
Land and livelihood
IFC provided loans to LCT totaling €92.5 million (€82.5 million in 2011 and €10 million in 2015). IFC also mobilized approximately €142.5 million from other lenders.
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 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's compliance investigation noted that IFC’s E&S review did not identify coastal erosion as a risk of the project, although the ESIA acknowledged potential erosion impacts during construction and describes the history of coastal erosion since the port was constructed in the 1960s. CAO found IFC non-compliant with the 2006 Sustainability Policy on this issue. Further, CAO found 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 noted 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 found that IFC’s pre-investment E&S review of the project was not compliant with the 2006 Sustainability Policy.
- Disclosure and Consultation
CAO noted 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 noted 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 found IFC to be non-compliant with the requirement to ensure that the Action Plan meets the requirements of PS1. CAO also noted 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 acknowledged that IFC and its client agreed on actions regarding the project’s impacts on coastal erosion in February 2016. However, CAO found these actions insufficient in several respects.
First, 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 found 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 noted 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 found 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 found that IFC has not provided advice which would bring the client back into compliance as per the Sustainability Policy.
On April 2, 2018, CAO released its first monitoring report of IFC’s actions taken in response to the investigation. Overall, CAO’s monitoring report welcomed a number of actions proposed and taken by IFC. Nonetheless, the actions implemented at the time had not substantially addressed the investigation findings at project level. At the level of policies and procedures, CAO acknowledged IFC’s update of its EHS Guidelines for Ports, Harbors and Terminals, including a new section which provides useful guidance in relation to the assessment of project impacts on coastal processes and land erosion. CAO further noted that IFC contracted a third-party consultant to support expert reviews of projects with potential impacts on coastal erosion.
CAO released a second monitoring report on April 22, 2019. At project level, the report recognizes IFC’s efforts to engage with the complainants and respond to their concerns since the publication of the investigation. While noting significant delays in implementation since CAO’s first monitoring report, CAO is encouraged by the progress made in early 2019. The commissioning of an environmental audit including a component on coastal erosion, as well as the initiation of a study on the contribution of different infrastructure projects on coastal erosion, which both envisage consultations with coastal communities, are positive steps towards bringing the project back into compliance.
On August 11, 2021, CAO released a third monitoring report. In its report, CAO notes that complainants’ concerns about coastal erosion have not yet been addressed in accordance with IFC requirements. Of particular concern, erosion impacts associated with the project due to its reliance on the Port of Lome infrastructure continue to affect complainants. In order to resolve this issue in accordance with IFC requirements, it will be necessary for IFC to work with LCT to determine possible remediation measures to address erosion impacts associated with the project, due to its reliance on the Port of Lomé infrastructure as required by paragraph 13 of the 2006 Sustainability Policy.
CAO further notes that it will be necessary for IFC to ensure completion of the outstanding assessment of project erosion impacts in accordance with PS1. This includes the requirement to consult with affected communities based on prior disclosure of draft assessment reports as well as any associated action plans (PS1, para. 21).
Finally, CAO recommends that IFC ensure disclosure of all required E&S documentation, including: (a) the final version of the coastal erosion study of April 2020, (b) any revised version of the coastal erosion study, and (c) the updated ESAP (following PS1, paras. 20 & 26).
CAO will keep the investigation open for monitoring and plans to issue a follow-up monitoring report in 2023.
All documents relating to this case are available under "Case Documents" section below.
Case remains under compliance monitoring. CAO expects to release another monitoring report in 2023.
Status as of March 15, 2023.