Today, hundreds of Liberians, with assistance from civil society organizations Accountability Counsel and Green Advocates, filed a complaint with the U.S. Overseas Private Investment Corporation (OPIC), one of the financiers of Buchanan Renewables’ operations in Liberia.

Cut and Run

Update on the impact of Buchanan Renewables' operations and Vattenfall's divestment

The complaint was based in part on SOMO’s extensive research, which documented how livelihoods of farmers and charcoal producers were harmed by the company’s activities and its sudden departure. The Liberian farmers, charcoal producers and workers seek redress from Buchanan Renewables, a shell company based in the Netherlands, and call on the U.S. government to investigate its role in the harms that have occurred.

Between 2009 and 2011, Buchanan Renewables’ received a total amount of US$216,7 million from OPIC to harvest rubber trees for biomass, rejuvenate family farms and generate sustainable energy for Liberia. Instead, the project harmed its intended beneficiaries. Buchanan Renewables liquidated its operations after minority shareholders Vattenfall and Swedfund had divested from the company, leaving many seeking promised assistance and compensation for work-related injuries.

“Buchanan Renewables failed to deliver on its promises of permanent jobs, green energy, poverty alleviation, and economic development, and instead left behind a legacy of abuse,” said Alfred Brownell of Green Advocates International, a Liberian organization representing the victims.

Failed promises to farmers

Many farmers had agreed to sell their old rubber trees to Buchanan Renewables in exchange for young seedlings that would be planted and maintained until maturity by the company. SOMO’s research found that these farmers are unable to maintain their farms now that the company has left. The project left many smallholder farmers who had subsisted on income from their rubber trees struggling to satisfy their basic needs.

“This so-called development project destroyed livelihoods and drove communities deeper into extreme poverty,” explains Francis Colee of Green Advocates.

Charcoal producers and negative climate impacts

Charcoal producers also suffered abuses when they were forced to compete with the company for the rubber trees on which their livelihoods depend. Complainants allege that company employees demanded bribes, and sex from women, for leftover wood that the company had promised to give local producers for free. This situation drove desperate charcoal producers to degrade nearby natural forests, turning OPIC’s allegedly climate-friendly investment into a project with negative climate impacts.

Labor rights violations were also rampant. Sam Yeadieh, a representative for the former workers, said “We were forced to work under terrible conditions without safe drinking water or proper safety equipment, leading to illness and serious injuries. We were not paid what we had earned, and women were abused on the job.”

OPIC responsibility

“This was a high-risk investment,” explains Tim Steinweg, a senior researcher investigating the project for SOMO. “It is unconscionable that, as an OPIC-financed development project, there was not a proper exit strategy in place to mitigate the harmful impacts of the project’s failure. ”

“OPIC’s due diligence rules, which were flouted in this case, were designed to avoid this type of harm,” said Sarah Singh of Accountability Counsel, a legal organization representing victims. “OPIC must immediately investigate its involvement and take responsibility for its role in funding these abuses, which continue to cause suffering today.”

Follow up

On 24 January, and two days after a complaint was filed by hundreds of Liberians, OPIC committed to conducting an independent review of the impacts of its investment in Buchanan Renewables. While this is an important first step, the complainants are awaiting details regarding OPIC’s timeline and what steps it intends to take to ensure that the review is transparent, truly independent and lead to remedy for the Liberians.

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