From All Africa

Hundreds of Liberians have filed a complaint accusing a U.S. government agency of failure to carry out due diligence or ensure that safeguards were followed for investments made to a failed biomass project in Liberia.

From 2009 to 2011, the U.S. Overseas Private Investment Corporation (OPIC) made three loans to a Dutch-registered company, Buchanan Renewables, that aimed to replant a mature rubber plantation in Liberia and use the old trees to run a new biomass-fired power plant, which the company also wanted to build. The OPIC loans, totalling around 217 million dollars, constituted 70 percent of the project’s total costs.

“This so-called development project destroyed livelihoods and drove communities deeper into extreme poverty.” — Francis Colee

The scheme, which has since failed, was initially described as a climate-friendly, pro-poor attempt to resuscitate Liberia’s rubber industry while powering its economy. Yet according to the new complaint, filed Wednesday, the project was rife with abuses.

Further, the complainants say the company’s sudden withdrawal has resulted in hundreds of local community members being unable to support themselves or their families. OPIC investigations, they say, should have flagged these and other potential problems, and they are now calling on the agency to offer reparations.

“Because of OPIC’s role in this project, people in Liberia are actively suffering from hunger and environmental damage that has been catastrophic to their livelihoods,” Natalie Bridgeman Fields, the executive director of Accountability Counsel, a watchdog group representing some of the Liberians party to the complaint, told IPS.

According to the complaint, OPIC oversight should have realised that the Buchanan Renewables plan would prevent local farmers and charcoal producers from making an independent living once the project got underway. While locals did sign contracts to tend to the new rubber trees and do related work, this set-up also made them entirely dependent on the company.

“OPIC, in violation of its social and environmental rules, failed to require an appropriate level of due diligence regarding [Buchanan Renewables’] operations in Liberia,” the complaint, addressed to OPIC President Elizabeth Littlefield, states, “and did not take adequate action to stop or remedy the harm experienced” as a result of the company’s activities.

Read more at All Africa