Dossier on biodiversity projects in a fragile context

Biodiversity describes the diversity of species, ecosystems and habitats. They must interact effectively if systems useful for humans are to emerge. We depend on these systems for basic needs such as food, clean air and drinking water; they protect us from disasters like floods and landslides and are essential for climate change mitigation as CO2 sinks. But biodiversity is under threat because habitats are being destroyed or natural resources overused, e.g. by poaching, overfishing or mining. As a result, species are irrecoverably lost and ecosystems are thrown off balance. Scientists are already talking about the sixth mass extinction of species in geological history. Climate change will further accelerate this process. The latest report of the World Biodiversity Council (IPBES) dated 6 May 2019 has made absolutely clear how pressing this issue is. The international community has set goals under the Convention on Biological Diversity (CBD) to address the loss of biodiversity. Effective measures are needed to implement them: in 2020, the CBD will reach further decisions at its Conference of Parties in China by 2030 to conserve biodiversity on the planet.

Through the financing activities of KfW, Germany has become one of the world's biggest donors for biodiversity conservation. KfW is currently supporting projects in 51 partner countries. Between 2014 and 2018 KfW committed a total of EUR 2.1 billion to projects to conserve biodiversity. With 46%, almost half of the funds will benefit Latin America and the Caribbean, 24% Africa, 14% Asia and 9% Europe/Caucasus. 7% of the funds are allocated to supra-regional measures. In these efforts, KfW is cooperating closely with the International Union for Conservation of Nature (IUCN) and non-governmental organisations such as the World Wide Fund for Nature (WWF) and the Frankfurt Zoo-logical Society (ZGF). These have many years of experience in project work dealing with how nature conservation and the improvement of local livelihoods can be intelligently combined.

KfW pursues the goal of preserving natural habitats as extensively as possible. In most cases, the measures benefit protected areas that have existed for decades; new protected areas are less often designated in nature conservation projects. Management is improved in these protected areas, taking into account the interests of local user groups, or permanent financing mechanisms are established. The aim is to preserve the protected areas in the long term. KfW also promotes the sustainable management of natural resources, e.g. in forest management projects. These projects include incentives for forest conservation, e.g. through remuneration systems such as those provided for in the international REDD programme (REDD - Reducing Emissions from Deforestation and Forest Degradation).

KfW-financed projects for the conservation of biodiversity are designed as integrated programmes that always focus both on preserving valuable ecosystems and in particular on supporting human livelihoods, especially for indigenous and other particularly vulnerable population groups. In an effort to meet this high standard, KfW has committed to complying with international environmental and social standards, which should be implemented in all projects. The binding standards for the assessment of human rights are defined in KfW Development Bank's sustainability guidelines  (PDF, 327 KB, non-accessible). These stipulate that the standards of the World Bank Group, the Human Rights Guidelines of the German Federal Ministry for Economic Cooperation and Development (BMZ) and the UN Basic Principles and Guidelines on Development-based Evictions and Displacement must be observed in Financial Cooperation projects implemented by KfW on behalf of the German Federal Government.

KfW reviews the human rights context both in the run-up to and during the implementation of all projects as part of its environmental and social management system. The resulting due diligence obligations incorporate the provisions of the BMZ Human Rights Guidelines and international standards and aim to identify and mitigate human rights risks arising from the concrete protection measures of the respective protected area. Appropriate measures include, for example, advising the partner organisations on relevant norms and standards in protected area management and the inclusion of corresponding requirements in relevant documents of the nature conservation authorities. Their implementation is supported by on-site workshops and training measures. These include, in particular, training of park employees on human rights standards, the application of the principle of proportionality when defending against threats, and interaction with neighbouring communities.

However, the implementation of the applicable environmental and social standards poses a major challenge for projects in protected areas especially in fragile contexts with a volatile security situation (e.g. in the Congo Basin). It often requires a process in which setbacks are possible or – depending on the initial situation – even likely. KfW is responding to this situation with additional measures tailored to the context of the protected area, which are currently being reviewed and further developed. These include incorporating human rights requirements into the training of rangers in accordance with relevant international standards, the additional use of consultants for ad hoc situation analyses on the ground and strengthening of local complaint mechanisms.

Environment and Sustainability at KfW

Biodiversity conservation benefits the entire world population in different ways. The local community however derive the largest gains because livelihoods are preserved. It is obvious that nature conservation can only be successful by working with local residents and not against them.

During the project preparation phase, meetings are held with civil society representatives of the local community to win their support. Already at this point it is clear that conflicting interests often need to be balanced, which is taken into account in the respective project design. Conflicts between different stakeholders are to be expected over the course of the project. In these cases, KfW aims to make a contribution to conflict resolution during project implementation.

When nature conservation areas are designated, restrictions are imposed on how they can be used – for example, hunting of wild animals, logging, and clearing of land for agriculture are restricted or prohibited. Reconciling interests with the traditional rights of the local population is therefore an integral part of the preparation and implementation of measures within the scope of our protected area projects, but unrestricted use of resources would be contrary to the nature conservation goals. To create and maintain awareness and acceptance of the measures, mechanisms for involving the population in decision-making processes are strengthened in protected area management, e.g. in the form of regular meetings of park management and representatives of the local authorities. It is also important to promote alternative sources of income that are compatible with biodiversity conservation as compensation for the restrictions on use. These can be generated, for example, by salary payments through jobs and training in the area of park management (e.g. as park guards, trackers, construction workers, etc.), or through impulses for general economic development in the neighbouring areas (e.g. repairing schools or rehabilitating roads, trails or bridges).

In its declaration on respect for human rights in its business operations, KfW Group committed to respecting and protecting international human rights in its sphere of influence already in 2008. Human rights are therefore the non-negotiable basis of every KfW commitment. This applies not only in a moral sense, but also in contractual terms. Any violation of human rights standards committed or tolerated by KfW's project partners is a violation of contractual agreements. KfW urges the institutions involved – the project-executing agency, the authorities of the partner government, other participating organisations and consultants – to clarify the circumstances immediately and provide all information on each incident that it becomes aware of. If necessary, KfW sends its own staff to assess the situation on the ground. At the same time, it is aware that in many regions there is no rule of law and that judicial systems are weak. Moreover, KfW cannot and will not influence individual decisions by judicial authorities. As long as the allegations are not satisfactorily resolved and credible countermeasures undertaken, contractual sanction mechanisms ranging from suspended payments to recovery of funds already disbursed will apply.

The withdrawal of KfW and other donor organisations would help neither the conservation of biodiversity nor the protection of human rights. KfW sees a role for development cooperation also in contributing to the enforcement of human rights in a difficult environment characterised by violence and weak institutions. For all people in conflict areas – including the rangers – living and working under the prevailing conditions poses existential dangers. In order to achieve that the stakeholders align their activities with human rights standards, active external support is a key influencing factor. KfW and other international development finance institutions are working rigorously – with contracts and sanctions, but also with incentives and advice – to ensure that sensitivity to human rights and a zero tolerance policy for violations are established as a routine practice of its partner organisations. As the incidents in the Congo basin show, this work is not always easy and often needs to be backed up by a variety of measures. However, the risk of setbacks would be even greater if external donors were to cease their commitment and the associated critical observation and financial incentives no longer took place.

Discontinuing development cooperation would have fatal consequences with regard to biodiversity. Without financial support from external donors, the chances of success for nature conservation in developing countries would rapidly decline because poor economic conditions and high population growth in many places put pressure on natural resources. This is even more true in conflict areas, where many people are primarily concerned with ensuring their daily survival. Functioning ecosystems like those in the Congo Basin (the world's second largest uninterrupted tropical forest area) are as irreplaceable as they are indispensable – for the planet as a whole, and especially for local people whose current and future livelihoods are at stake. Suspension of payments can also cause existential economic hardship for local employees who are not guilty of misconduct.

For every incident of which KfW is aware, it is calling, as it has done in all previous cases, on the state project-executing agencies responsible on the ground and other partners involved to clarify all allegations immediately and fully. Moreover, detailed investigations are being conducted. To this end, KfW relies not only on information to be provided by its partner organisations, but also on findings obtained with the help of consultants and its own local staff.

The large number of incidents has shown that the mechanisms created in national park projects in the Congo Basin to prevent and deal with human rights violations are inadequate. For continued work in the region, the processes agreed with the organisations involved will be reviewed on an ongoing basis and adapted if necessary.

Firstly, as soon as project partners’ allegations came to light, the Congolese state conservation agency, the Institut Congolais pour la Conservation de la Nature (ICCN), and others involved in the project were called on to clarify all allegations immediately and fully. In relation to Salonga National Park, which was the subject of particularly serious allegations, KfW commissioned external experts in 2019 to analyse how the incidents were handled and recommend any changes required in order to better protect the human rights of the local population in future. The results of this investigation  (PDF, 624 KB, non-accessible) reveal deficiencies in core areas of the structures and processes that govern park protection and anti-poaching. A management system for use by park rangers, which is based on international human rights standards, has only been developed as a concept to date and is barely applied in practice. For example, a lack of reporting has made it difficult to systematically investigate allegations that have been made regarding human rights violations. Key information on patrols, the individuals involved or particular incidents is often badly documented. As yet, comprehensive GPS tracking of patrols is not used across the board. On the other hand, the experts note positive approaches in relation to the development of a complaints mechanism aligned with international standards which will, in future, give local people the opportunity to make complaints about park employees while preserving their anonymity.

A significant benefit of the report is its differentiated evaluation of the complex and fragile context in which KfW is supporting Salonga National Park. Particular issues include the institutional weakness of the state actors involved, flawed governance and a lack of the rule of law and legal certainty. It realistically assesses the resulting limitations on our freedom to make changes within the project and takes these into consideration when proposing improvements. Key measures to be implemented during KfW’s continued engagement, with extensive support from international experts, include the creation of an independent management function to investigate allegations and to take disciplinary action in case of misconduct by park staff; support for comprehensive training and ongoing mentoring for all park rangers based on recognised human rights approaches; and the introduction of a code of conduct for park rangers that is aligned with international standards.

In evaluating the findings, KfW received independent assistance from the German Institute for Human Rights (DIMR). The DIMR report can be viewed here  (PDF, 131 KB, non-accessible).

ICCN/WWF passed the specific allegations and cases to the relevant law enforcement bodies.

In light of the allegations, the Federal Ministry for Economic Cooperation and Development (BMZ) had temporarily ceased all payments in conjunction with FC activity to the Congolese nature conservation authority Institut Congolais pour la Conservation de la Nature (ICCN). This decision was taken after a careful weighing up of multiple factors, including the possible negative effects of suspending payments. However, there was no general payment freeze for projects outside of DR Congo with WWF involvement.

In late May 2020, the Federal Ministry for Economic Cooperation and Development and ICCN agreed the terms of a gradual resumption of payments as part of FC activity, detailed in a Memorandum of Understanding (MoU). In the MoU, a number of measures were agreed to improve human rights and embed them more strongly as a topic of importance for the Congolese conservation authorities. In particular, international non-governmental organisations (INGOs) were given a more important role and it was agreed that in future, co-management agreements between INGOs and ICCN would be required for standard FC financing of conservation areas as part of direct cooperation with ICCN. The exception to this is funding for the Ngiri conservation area, where analysis is required regarding the possibility of introducing a more community-based management model in the context of potential further German support. Furthermore, robust risk assessments should start to be carried out in the conservation areas, based on internationally recognised standards like the Voluntary Principles on Security and Human Rights (VPSHR). These should identify security risks that may arise as a result of political, economic or social circumstances or changes in these, and incorporate relevant aspects like the capacity of local law enforcement and the judicial system, and the human rights record of the security forces, paramilitaries and local and national law enforcement. Initial results of the risk assessments are available. However, due to coronavirus pandemic travel restrictions, they have not been fully completed yet. Based on these risk assessments, targeted measures should then be implemented, tailored to each conservation area. Furthermore, decisions were also taken to continue with a comprehensive training and development programme, to improve ICCN’s management capacity in relation to human rights, as part of technical cooperation, and to provide greater support to local people in nature conservation areas. This includes gradual introduction of complaint mechanisms. Assurances were provided that the institutions involved will review the specific allegations fully.

The implementation of the agreement and, in particular, the review of the specific allegations of human rights violations in the context of KfW’s conservation commitment in DR Congo will continue to be supervised closely. The payments for individual conservation areas in DR Congo are gradually recommencing (and have already begun, in some cases) once the agreed requirements have been fulfilled and subject to consideration of the social needs of those affected, as agreed between the Federal Ministry for Economic Cooperation and Development and ICCN.

In light of the extremely precarious situation surrounding Kahuzi-Biega National Park in eastern Congo and to fulfil the commitment made by the State Secretary of the Federal Ministry for Economic Cooperation and Development (BMZ), KfW made a one-off extraordinary payment at the beginning of December 2020 to mitigate social hardships and to relieve tensions between park administrators and the local community.

The call for greater transparency has been acknowledged. In recent years, KfW Development Bank has significantly expanded the amount of publicly available project information that it offers through its Transparency Portal and the International Aid Transparency Initiative (IATI). This is reflected in a considerably better rating in this year’s international Aid Transparency Index. We are pursuing this further as business processes are digitalised, and more data is being made publicly accessible. Furthermore, DIMR’s comments on the role of KfW’s own complaints mechanism will be fed into the ongoing process of revising this mechanism. DIMR will continue to advise KfW during the process.

The report issued in November 2020 by the independent commission under the direction of former UN High Commissioner for Human Rights, Navanethem Pillay, confirms substantial parts of the findings with regard to the risk of human rights violations in conservation areas. The recommendations for action relevant to DR Congo largely correspond to those of the DIMR, as was included in the above-mentioned memorandum with ICCN. The report highlights the need to consistently implement and monitor these recommendations. Our Partner WWF is cleared by the Commission of key allegations such as those related to the arms trade and support for a “shoot-on-sight policy”. However, it was also determined that human-rights-related due diligence processes were lacking before involvement in a conservation area began, and that project-executing agencies were not sufficiently and consistently obligated to comply with human rights. International donors like KfW have the task of monitoring compliance with these standards and also need to react to infringements quickly when they become known.

We are aware of the responsibility we bear as a financier of nature conservation projects. We acknowledge that mistakes have been made in the past. We are appreciative of the efforts civil actors and experts have made to resolve these mistakes and their causes. KfW will continue its work in the nature conservation sector, including fragile regions. However, we are also aware that we need to be more active and sensitive in order to identify human-rights risks early on and to systematically recognise and follow-up on the potential and need for conflict-sensitive planning and implementation, thus better preventing future conflicts between local populations and park authorities, or even human rights violations.