Human rights in resettlement policies of European bilateral Development Finance Institutions operating in Sub-Saharan Africa: Hitting the mark?

Development-induced displacement persists as a major threat to the human rights of affected communities in Sub-Saharan Africa. These projects often involve financing from multilateral development banks (MDBs) and bilateral Development Finance Institutions (DFIs). Africa has taken the lead in developing legal frameworks on displacement, including the adoption of the first binding treaty on internal displacement. Notably, the environmental and social frameworks of MDBs and DFIs provide additional safeguards to those displaced by financed projects. To this end, the World Bank’s International Finance Corporation Performance Standards (IFC PSs) on involuntary resettlement have acquired global normative significance and have been adopted by bilateral DFIs that support private sector development in developing countries. Using some bilateral DFI-financed projects in Sub-Saharan Africa as examples, this article argues that these financiers primarily apply the IFC PSs in projects with potential displacement impacts without adequately integrating existing legal frameworks on human rights and internal displacement. Using desk-based research, the article examines the extent to which the IFC PSs, as adopted by bilateral DFIs, align with international human rights standards on development-induced displacements. It finds that the IFC PSs contain significant normative gaps on aspects including participation of the communities and right to effective remedy, which weaken the protection available to the affected persons. The article argues that, given their potential influence over national legal and policy reforms, bilateral DFIs should incorporate existing human rights standards directly into their operations to strengthen safeguards for affected communities. It concludes with a recommendation that DFIs must move beyond addressing human rights superficially within their market-based environmental and social risk management function and instead integrate them into their core work of promoting sustainable development in developing countries.