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This complaint is submitted to the Office of the Compliance Advisor Ombudsman by members of communities adversely impacted by the operations of Nicaragua Sugar Estates Limited, S.A. (“NSEL”) in the states of León and Chinandega, Nicaragua, and NSEL’s former employees. The complainants seek redress for injuries to their health, environment, and livelihoods resulting from the failure of the International Finance Corporation (“IFC”) to comply with its Policy on Social and Environmental Sustainability and its Environmental and Social Review Procedures in its loan to NSEL.
On October 25, 2006, the IFC approved a $55 million loan to finance expansion of NSEL’s production and processing of sugarcane. The purpose of the loan, Project 25331, is to enable NSEL to acquire up to 2,482 hectares of additional land for sugarcane cultivation; improve the efficiency and maximize the capacity of its existing sugar mill; to purchase equipment for mechanical harvesting and invest in plantation infrastructure and maintenance; to install more efficient irrigation systems; and to construct an ethanol plant to produce and export ethanol.
The complainants, listed in Annex A, are (1) residents of Goyena and Abangasca, communities located in León, Nicaragua, in which NSEL cultivates sugarcane; (2) residents of Chichigalpa, Nicaragua, the community in which NSEL’s sugar mill is located; and (3) former NSEL employees. The adverse impacts to complainants’ health, environment, and livelihoods resulting from NSEL’s operations under the IFC loan include, inter alia:
• An epidemic of Chronic Renal Insufficiency (“CRI”) among NSEL sugarcane workers and members of communities adjacent to NSEL sugarcane fields;
• Interference by NSEL in attempts to establish a union independent of NSEL control and associated retaliation against those workers who sought to form or join the union;
• Impacts to indigenous Sutiaba lands from pesticide drift;
• Air pollution and associated respiratory illnesses experienced by communities adjacent to NSEL sugarcane fields as a result of sugarcane burning prior to harvest;
• Depletion of groundwater as a result of NSEL’s irrigation of sugarcane fields;
• Suspected contamination of community drinking water supplies and natural water bodies
with pesticide, runoff from sugarcane fields, and improper treatment and disposal of effluent from cane processing; and
• Incarceration and/or persecution and harassment of community members, and current and former employees, who raise concerns about NSEL’s activities.
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