It Takes Two Dead Activists for Banks to Suspend Funding for Honduran Project

If the murder of Honduran activist Berta Cáceres was not enough to convince European development banks to pull their funding from the massive dam project she had protested, the killing of one of her colleagues seems to have done the trick.

Nelson García, who worked with Cáceres before she was shot and killed by unidentified gunmen two weeks ago, was himself shot and killed outside his mother-in-law’s house at lunchtime Tuesday. His murder prompted two European development banks, Netherlands Development Finance Co., or FMO, and FinnFund, to suspend their funding of the Agua Zarca hydroelectric project that Cáceres spent a decade protesting.

FMO released a statement Wednesday saying that the company was “shocked” to hear of García’s murder and would suspend all activities in Honduras. “This means that we will not engage in new projects or commitments and that no disbursements will be made, including the Agua Zarca project,” the company, which has invested $15 million in the project, said in a press release. Another activist, Tomás García, was killed during a protest in 2013 — the year before FMO first invested in the project.

Jaakko Kangasniemi, FinnFund’s chief executive, told Development Today, a Nordic aid magazine, that his company would be “suspending disbursements” to Agua Zarca as well, although he still believes the affected communities want the project to continue. The indigenous Lenca people say that the project will cut off vital river access and threaten their livelihoods.

The Central American Bank for Economic Integration is the biggest investor in the project, having loaned $24.4 million to Desarollos Energeticos S.A, the hydroelectric company in charge of the project. A group of NGOs is now calling on the bank to publicly clarify their stance on Agua Zarca.

Monti Aguirre, a friend of Cáceres and Latin America director for International Rivers, an advocacy organization that focuses on protecting rivers from large dam projects, welcomed the withdrawals. “Promoters of infrastructural, resource extraction, and agribusiness projects are hopefully paying attention,” she told Foreign Policy in an email. “Their investments need to be in full compliance with social and environmental policies, as well as national and international laws.”

The Honduran police issued a statement calling Nelson García’s murder “a completely isolated case.” He was killed after helping the Río Chiquito community dismantle their houses in preparation for a government-ordered eviction, which was not related to the Agua Zarca project. But García was a member of the Civic Council of Popular and Indigenous Organizations, the organization that Cáceres founded in 1993.

Brigitte Gynther, who is the Latin America liaison for the the School of the Americas Watch and has lived in Honduras since 2012, told Foreign Policy in a phone call Wednesday she doubts the Honduran police’s narrative. “It’s very common in Honduras for the authorities to try to hide the political nature of these killings,” she said.

Photo credit: ORLANDO SIERRA/AFP/Getty Images

Correction, March 22, 2016: Brigitte Gynther is the Latin America liaison for the School of the Americas Watch. A previous version of this article mistakenly said that she was the Latin America liaison for the School of the Americas.