Local communities and NGOs condemn new World Bank loan for Ecuador’s largest meat company

Loan will expand polluting factory farming operations across Ecuador
Local communities and NGOs condemn new World Bank loan for Ecuador’s largest meat company

Washington D.C. – Late last week, the World Bank’s International Finance Corporation (IFC) board approved a $50 million loan to Pronaca, Ecuador’s biggest livestock producer and 4th largest corporation in Ecuador.

The decision was taken despite the IFC’s failure to do a full environmental and social review or conduct meaningful stakeholder consultation through an on-site investigation. 

A coalition of Ecuadorian groups and international NGOs urged the World Bank’s shareholders to oppose the project due to the harmful impact of the companies’ factory farming operations on rural and indigenous communities in Ecuador and the violations of the Bank’s own policies. Groups are also concerned that the IFC loan would undermine competition and farmer livelihoods by further entrenching Pronaca’s monopoly of the pork and chicken market in Ecuador.

The IFC’s loan will finance the expansion of Pronaca’s pork and chicken operations in Ecuador. In 2010, local indignous communities in the Santo Domingo de Los Tsáchilas province formally complained to the IFC that animal waste from Pronaca’s livestock farms contaminated the waterways used by indigenous peoples for their crops, animals and households. As a result, the region saw a surge in health problems, including skin, respiratory and gastrointestinal issues. Persistent foul odors have undermined the income from the local tourism and the community’s quality of life.

Xavier León, from Acción Ecológica, an Ecuadorian environmental NGO that works in coalition with the Tsáchillas people, who are most impacted by Pronaca’s current operations said: “Pronaca should not be financed by the World Bank. The environmental, social and economic impacts of these intensive farms near the water sources and ancestral territories of the Tsáchilas indigenous people will only increase with this new World Bank loan”

On April 16, a coalition of 16 NGOs, including Sinergia Animal, Feedback, Friends of the Earth U.S., and the Global Forest Coalition, sent a letter to IFC’s board members and executives, highlighting why a loan for Pronaca was incompatible with the World Bank’s commitment to the Sustainable Development Goals and the Paris Climate Agreement.

“The new financing by IFC for Pronaca is not only out of alignment with the Bank’s climate goals. It also grossly undermines the rights and health of communities living in the Santo Domingo de Los Tsáchilas province,” said Kari Hamerschlag, Deputy Director of Food and Agriculture at Friends of the Earth U.S. “The World Bank should never have approved a loan that fails to uphold the IFC own policies on the community health and well-being and on indigenous peoples.  

Expert contact: Kari Hamerschlag, Friends of the Earth U.S., 510-207-7257

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