The new village of Bildak in Ethiopia's Gambella region, which the semi-nomadic Nuer who were forcibly transferred there quickly abandoned in May 2011 because there was no water source for their cattle.

(Washington, DC) – The World Bank should fully address serious human rights issues raised by the bank’s internal investigation into a project in Ethiopia, Human Rights Watch said in a letter to the bank’s vice president for Africa. The bank’s response to the investigation findings attempts to distance the bank from the many problems confirmed by the investigation and should be revised. The World Bank board of directors is to consider the investigation report and management’s response, which includes an Action Plan, on February 26, 2015.

The Inspection Panel, the World Bank’s independent accountability mechanism, found that the bank violated its own policies in Ethiopia. The investigation was prompted by a formal complaint brought by refugees from Ethiopia’s Gambella region concerning the Promoting Basic Services (PBS) projects funded by the World Bank, the United Kingdom’s Department for International Development (DFID), the African Development Bank, and several other donors.

“The Inspection Panel’s report shows that the World Bank has largely ignored human rights risks evident in its projects in Ethiopia,” said Jessica Evans, senior international financial institutions researcher at Human Rights Watch. “The bank has the opportunity and responsibility to adjust course on its Ethiopia programming and provide redress to those who were harmed. But management’s Action Plan achieves neither of these goals.”

The report, leaked to the media in January, determined that “there is an operational link” between the World Bank projects in Ethiopia and a government relocation program known as “villagization.” It concluded that the bank had violated its policy that is intended to protect indigenous peoples’ rights. It also found that the bank “did not carry out the required full risk analysis, nor were its mitigation measures adequate to manage the concurrent rollout of the villagisation programme.” These findings should prompt the World Bank and other donors to take all necessary measures to prevent and address links between its programs and abusive government initiatives, Human Rights Watch said.

Rather than taking on these important findings and applying lessons learned, World Bank management has drafted an Action Plan that merely reinforces its problematic current course, Human Rights Watch said. The Action Plan emphasizes the role of programs designed to mobilize communities to engage in local government’s decisions without addressing the significant risks people take in speaking critically.

The Inspection Panel also found that the bank did not take the necessary steps to mitigate the risk presented by Ethiopia’s 2009 law on civil society organizations. The law prohibits human rights organizations in Ethiopia from receiving more than 10 percent of their funding from foreign sources. As a result of the law, most independent Ethiopian civil society organizations working on human rights issues have had to discontinue their work.

The plan also pledges to enhance the capacity of local government staff to comply with the bank’s policies and to provide complaint resolution mechanisms without addressing the role of the local government in human rights abuses. This continues an approach of seeing the officials implicated in human rights abuses as a source of potential resolution, Human Rights Watch said. Management has also concluded, contrary to the Inspection Panel, that the World Bank is adequately complying with the bank’s policy to protect the rights of indigenous peoples.

Human Rights Watch research into the first year of the villagization program in the western Gambella region found that people were forced to move into the government’s new villages. Human Rights Watch found that the relocation was accompanied by serious abuses, including intimidation, assaults, and arbitrary arrests by security officials, and contributed to the loss of livelihoods for the people forced to move. While the Ethiopian government has officially finished its villagization program in Gambella, it is forcibly evicting communities in other regions, including indigenous people, ostensibly for development projects such as large-scale agriculture projects.

Donors to the Ethiopia Promoting Basic Services Program, including the World Bank and the UK, have repeatedly denied any link between their programs and problematic government programs like villagization.

Human Rights Watch has long raised concerns over inadequate monitoring and the risks of misuse of development assistance in Ethiopia. In 2010 Human Rights Watch documented the government’s use of donor-supported resources and aid to consolidate the power of the ruling Ethiopian People’s Revolutionary Democratic Front (EPRDF). Government officials discriminated on the basis of real and perceived political opinion in distributing resources, including access to donor-supported programs, salaries, and training opportunities. Donors have never systematically investigated these risks to their programming, much less addressed them.

The Inspection Panel report is the first donor mechanism that has investigated the donor’s approach to risk assessment in Ethiopia. Although the Inspection Panel adopted a narrow view of its mandate and decided explicitly to exclude human rights violations, its findings underscore the need for donors to considerably enhance and broaden their risk assessment processes in Ethiopia. These processes are crucial for ensuring that their programs advance the social and economic rights of the people they are intended to benefit, without violating their human rights. Management’s response misrepresents the panel’s view of its mandate, erroneously concurring “with the panel’s conclusion that the harm alleged in the Request cannot be attributed to the Project” – the Inspection Panel report makes no such sweeping conclusion.

“The bank directors should send management’s response and Action Plan back and insist on a plan that addresses the Inspection Panel’s findings and the concerns of the people who sought the inquiry,” Evans said. “A meaningful Action Plan should address the program in question, bank-lending in Ethiopia more broadly, and how to apply lessons from these mistakes to all bank programing in high-risk, repressive environments around the world.”

The Action Plan should include provisions for high-level dialogue between the bank and the Ethiopian government to address key human rights issues that are obstacles to effective development, Human Rights Watch said. These issues include forced evictions and development-related displacement, restrictions on civil society, including attacks on independent groups and journalists, discriminatory practices, and violations of indigenous peoples’ rights.

The plan should include provisions for identifying and mitigating all human rights risks and adverse impacts at the project level, and for independent monitoring to make sure these concerns are fully addressed. The plan should also include provisions for people affected by projects to be involved in projects from their conception and remedies for people negatively affected by bank projects.

Given the climate of fear and repression in Ethiopia, Gambella residents who brought the complaint to the bank and have taken refuge in South Sudan and Kenya are unlikely to feel safe returning home. In light of this, the Action Plan should address their most urgent needs abroad, including education and livelihood opportunities, Human Rights Watch said.

The Inspection Panel’s findings also have wider implications for donor programming in Ethiopia. Donors’ current appraisal methods do not consider human rights and other risks from their programs. The panel highlighted particular problems with budget support or block grants that cannot be tracked at the local level.

“The Inspection Panel report illustrates the perils of unaccountable budget support in Ethiopia,” Evans said. “Donors should implement programs that ensure that Ethiopia's neediest participate in and have access to the benefits of donor aid.”