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Development requires human rights

There is a close relationship between development and human rights, as development cooperation efforts pursue goals that contribute towards the realisation of human rights. Consequently, development cooperation projects can be designed to strengthen human rights. But there are still challenges; for instance, in implementing good governance practices, or in the threats stemming from war, displacement, a lack of social services or inadequate levels of gender equality. KfW has developed its own instruments for taking human rights into account in its projects.

Demanding and achieving rights

All human beings have human rights. People are not passive recipients of social benefits. Basic social services from state institutions are not a form of charity; they are human rights obligations to those with rights. Supporting people in their abilities to demand and achieve their rights is at the heart of a human rights-based approach to development.

But this must also entail state institutions recognising and meeting their human rights obligations. This is primarily the responsibility of the individual government in question. If a government does not achieve sufficient results by virtue of its own efforts, the international community is needed. This way, for instance, development cooperation put into place by external actors can support the assertion of human rights within partner countries.

It is no coincidence that development cooperation is committed to human rights. Human rights are an unconditional part of any development process designed to expand the freedom of every individual. Development processes themselves are an important prerequisite for people to demand, exercise and realise their rights.

Human rights standards and principles

Human rights are a guiding principle of German development cooperation (DC). Human rights criteria play a role in determining whether and how Germany cooperates with a country and which developmental objectives are pursued. The German Federal Government has set out guidelines for their practical implementation within governmental DC.

Human rights set standards for DC. One consideration is the outcomes: for example, water or education must be available, of sufficient quality and within the means of all population groups.

Another consideration is the process: this is where the principles that are a foundational part of human rights come into play (participation and empowerment, accountability, non-discrimination and equality of opportunity). If DC projects affect people, they must be included (participation). No-one is to be excluded on account of their origin, social status or ethnic group (non-discrimination). In addition, development bodies must disclose their plans and allow affected parties the opportunity to raise objections (accountability).

Present challenges for development

Human rights violations are a significant barrier to development. Development cooperation still faces challenges in supporting the realisation of human rights in partner countries. The principles of good governance are not always respected.

Targeted promotion of women and girls

Dr Léonie Jana Wagner, sector economist in KfW’s Competence Centre for Social Development and Peace

“KfW promotes human rights in different ways; for example, with a fund in Burkina Faso, which protects children from exploitation.”

Dr Léonie Jana Wagner, sector economist in KfW’s Competence Centre for Social Development and Peace


KfW Development Bank’s contribution to human rights in numbers: a selection

KfW Development Bank’s contribution to human rights in numbers: a selection

KfW’s instruments for respecting human rights

KfW has developed a range of instruments for taking human rights issues into account in its work.

Criticism of KfW: have human rights been violated?

The non-governmental organisations Germanwatch and Misereor published a study in 2017 entitled “The Global Energy Sector and Human Rights — Putting German Business and Policy to the Test”, which includes accusations that KfW Group participates in projects that infringe on human rights.

It states that, contrary to their standards, KfW Group is co-financing projects in the energy sector that will damage or are already adversely affecting the environment and human rights. Among the particular cases cited are a DEG financing package for the Barro Blanco hydropower plant in Panama, KfW Development Bank financing the Olkaria IV geothermal power plant in Kenya, and KfW IPEX-Bank export credits for delivering boilers to the Kusile and Medupi power plants in South Africa.

The study also criticises a lack of transparency. KfW does not publish any impact assessments or environmental and social plans, it contends, while KfW IPEX-Bank does not publicly reveal the projects it finances — and only DEG has an independent complaints mechanism.

KfW Group’s reply:

KfW and its subsidiaries — organised as “GmbH” (limited liability) companies — are limited to differing degrees in their capacity to share information on account of legal requirements for data protection, bank secrecy and trade secrecy.

Opportunities to raise grievances are provided systematically at all levels — with KfW, the business units or subsidiaries and co-financed projects. KfW gives very serious consideration to every complaint from people directly affected by a project or from NGOs involved. In addition to our internal monitoring mechanisms, these are part of the checks made to ensure that co-financed projects are implemented according to plan, with all environmental and social issues dealt with satisfactorily in the process. Carefully reviewing accusations and providing appropriate solutions as needed are crucial to this.

In the case of Olkaria, a mediation agreement was made in May 2016, receiving approval (“Addendum to Management Report and Recommendation in Response to the Inspection Panel Investigation Report” and “Agreement on Olkaria IV Resettlement Mediation”)from all the parties involved in the dispute.

The grievances raised over Barro Blanco were reviewed by an independent panel of experts. The panel confirmed that DEG had correctly followed its procedures as of the review and had met its standards as of the first disbursement. DEG promptly implemented additional recommendations by the panel to further improve its processes.

Review procedures and standards evolve over time. The financing provided to Kusile and Medupi was subject to an evaluation at the time by the World Bank, which focused solely on the power plants. KfW had followed the results of this evaluation after conducting its own review, though this would not be sufficient for KfW from today’s perspective.

An in-depth reply from all the companies named in the study by Germanwatch and Misereor is also available on Spiegel Online (German language only).

Case study: how the ESIA changes a project

An independent consultant working for KfW and other financiers informed us that a construction company’s monitoring reports on a major construction site with 13,000 workers in the Middle East indicated that the core labour standards of the International Labour Organization (ILO) were not being implemented as contractually agreed. Meeting the ILO core labour standards is a crucial guideline in IFC Performance Standard 2 and KfW’s sustainability policy. Although most of the workers’ housing complexes were in line with international best practice, unacceptable shortcomings were found at five out of 15 camps. These included exposed electric cables, inadequate kitchen and sanitation facilities, overcrowded sleeping quarters and a lack of fire escapes. KfW’s Sector and Policy Division for Environmental and Social Impact (ESIA SPD) followed up on these findings in close detail, demanding — and achieving — the betterment of living conditions to meet the standards. The subsequent improvements were integrated into an updated environmental and social management plan. KfW’s ESIA SPD regularly checks to ensure that the new standards are sustainably and rigorously implemented by way of reports from the independent consultant.