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Jilamito: An Extractivist Project Sponsored by International Cooperation

Original article published on Feb. 11, 2021 in spanish by Redacción CRITERIO.HN

Text: Marcia Perdomo

Editing: Emy Padilla

Photographs: Fernando Destephen

Videos: Jorge Burgos

Graphics: Guillermo Burgos

Tegucigalpa - A new year, a new caravan made up of more than 7 thousand Hondurans who left the country in mid-January suffocated by corruption and poverty, while international cooperation and financing agencies inject millionaire sums of dollars into private capital extractivist projects that create socio-environmental conflicts in communities in this Central American country.

After the coup in 2009, the doors were opened to the concession of water resources through the General Water Law and with it the approval of a series of renewable energy contracts whose "innocuous" nature is reserved only on paper for those that were drawn up but that have resulted in the criminalization of the communities that depend on and defend these rivers.

One of these conceived schemes is the Jilamito Hydroelectric Project, located in the municipality of Arizona, in the department of Atlántida in northern Honduras, a region rich in biodiversity that has three national parks, two wildlife refuges and a botanical garden. In fact, the Jilamito hydroelectric plant is located within the buffer zone of the Texiguat Wildlife Reserve and the Jilamito River micro-basin, which was declared in 1997 under Agreement CH-004-97.

With a population of 24,819 inhabitants according to estimates made by the National Institute of Statistics in 2018 - Arizona is threatened, its residents denounce, by the interests of businessmen, the State and international financial institutions. According to the inhabitants of the municipality, the political sector has distributed its rivers to businessmen who with international financing threaten their right of access to water.

The department of Atlántida is not a stranger to distributions that obey foreign corporate interests. At the beginning of the last century, specifically in 1912, the State of Honduras ceded said territory for the cultivation of bananas, displacing indigenous peoples. In fact, the name of the Arizona municipality corresponds to the designation given by the North Americans who administered the banana fields and who used to refer to them with the names of the states of the North American country.

The residents of the municipality of Arizona have organized to reject the Ingelsa company’s hydroelectric project.


At the beginning of December 2020, the Inter-American Development Bank (IDB) through its business promotion branch IDB Invest [known until 2017 as the Inter-American Investment Corporation] announced that it will finance the construction of the Jilamito hydroelectric project in Honduras through US$ 20.25 million dollar loan.

The IDB assured that this financing reaffirms IDB Group's commitment to the economic development of Honduras and that it was part of an investment package to support the country in facing the crisis triggered by the Covid-19 pandemic and the damage caused by hurricanes Eta and Iota. How the project will help tackle the crisis triggered by the pandemic and natural phenomena is unclear.

The IDB also fails to mention in the information disseminated through its web portal that the organized communities of the municipality of Arizona, Atlántida, oppose the project and have declared the territory free of extractivism or that in mid-March 2020 they condemned the visit of the consultants of the international financial organization, whom they accused of serving as intermediaries of the interests of extractive companies and projects that were harmful to their lives and their environments.

Added to the IDB loan is financing from the United States International Development Finance Corporation (DFC), for US$ 35,750 million. This loan would be part of a financing for US$ 1 billion in investments for the private sector over a period of three years in Honduras, announced on July 21, 2020 by the executive director of the DFC, Adam Boehler.

Boehler affirmed during the announcement of this financing [$1 billion] that it complements a memorandum of understanding signed that same day between the governments of the United States and Honduras to establish a framework for bilateral cooperation in support of the America Crece initiative.

In his speech Boehler said that "the DFC is proud to support the Honduran people during this time of need throughout the world." Furthermore, he added, “We appreciate the commitment of the Government of Honduras to improve the business climate to facilitate investment and we look forward to advancing our common goals through collaboration with the private sector. Public-private partnerships are fundamental to the strength of Honduras as a country and to the goals of América Crece.”

The DFC, formerly known as the Overseas Private Investment Corporation (OPIC), was renamed during the administration of US President Donald Trump. With the new name, it was accompanied by the initiative Growth in the Americas or América Crece, which according to the State Department aims to “create an environment conducive to private sector investment in energy and infrastructure that is transparent, competitive and consistent with the best international practices.”

América Crece has critics, who see in it a new Plan Puebla Panama, with all the arbitrariness that led to the defense for the land. At the beginning of October 2020, the Committee in Solidarity with the People of El Salvador (CISPES) published the article América Crece: Washington's new investment push in Latin America, in which it states that this initiative aims to counteract China's investment in the region; however, they warn that it lacks transparency when it comes to disclosing details about which projects are receiving financing.

In the case of Honduras, the exact amount of DFC investment in the Jilamito Hydroelectric Project is known from the information provided by the IDB on its website.


To understand the interests behind extractivist projects and the consequent financing by international organizations and agencies, interviewed the specialist in environmental law and researcher of the Jesuit Reflection, Research and Communication Team (ERIC - SJ), Pedro Landa, who starts by contextualizing the relevance of the Honduran Caribbean basin, which generates 70% of water production in the country and 40% in Central America.

This makes the rivers of the Caribbean basin attractive for hydroelectric generation under the false promise of renewable energy without taking into account the high degree of conflict that these projects generate in the communities, the consequent displacement of people and the depletion of natural resources, especially noticeable during the dry season, affecting the productive capacity of the area, explains Landa.

The environmentalist points out that these types of schemes, which in Honduras are not limited only to the 24 hydroelectric concessions in the department of Atlántida and which have been identified by the Broad Movement for Dignity and Justice (MADJ), are part of a project of greater importance that involves the entire Central American region.

Landa elaborates by pointing out that all the dams that are being built in Honduras and all the energy generation projects, whether photovoltaic, wind, or hydroelectric, are being connected to the Electrical Interconnection System for the Countries of Central America, known by its acronym as SIEPAC that was conceived during the first decade of the 21st century. The purpose of it, the environmentalist says, is to build a single energy transmission corridor throughout Central America, from Panama to the Yucatan Peninsula in Mexico, which in theory seeks to enable any country in the region that has an energy deficiency to buy from their country’s neighbors.

Nevertheless, the environmental defender notes that at least two more interconnection projects are being built in South America as well, all with a view to building a large power transmission system to the north and "the presumption that the United States, like Europe are taking measures to guarantee the supply of energy once the sources of hydrocarbons and oil are depleted.” All this in a context in which, "the latest wars of the United States, especially in Asia, have been for control of oil."

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Landa reasons that, given the depletion of oil, water is the resource that is gaining more prominence not only as vital for life but also for energy generation. And the Honduran environmentalist is not the only one to alert to international private interests in relation to the vital liquid. In December 2020, the UN Special Rapporteur on the right to drinking water and sanitation, Pedro Arrojo-Agudo denounced that the price of water on the Wall Street futures market violates basic human rights and makes the liquid element vulnerable to a possible speculative bubble.

“You cannot put a value on water as you do with other commercial commodities. Water belongs to everyone and is a public good. It is closely linked to all of our lives and livelihoods, and it is an essential component for public health," said the rapporteur Arrojo-Agudo in the statement.

For Landa there are a series of interconnections that align with the interests of the world's leading power, including the issue of guaranteeing the supply of energy for the United States, which like the European countries, “have declared the supply of raw materials including energy as a national security interest. By elevating them to this category, it means that states are willing to do whatever it takes, even going to war or invading a country to ensure the security of their states. In this case it is to guarantee the supply of energy.”

The environmentalist emphasizes that the financial support by IDB Invest and the US agency DFC “are investments in the future that they are making to guarantee this [electricity] supply and keep their production and comfort systems stable at the cost of the sacrifice and expulsion of our peoples. For them we are always that backyard from where they take what they want, regardless of whether it implies the sacrifice of human lives and entire populations that are forced to migrate.”

The specialist in environmental law identifies in this type of project a new category of migrants, environmental refugees or ecological refugees, who can no longer live in their territories. “The sad thing is that our pseudo rulers come and justify all this as a consequence of climate change when basically the reality is that policies that promote extractivism have been imposed in each of these countries and [...]our governments freely promote them just as the current regime of Juan Hernández has in promoting energy. […] Ultimately, what prevails is not so much the security of people and their assets but the legal security of companies, business and profit through these extractivist policies that dominate in the Central American region.”

Historically, the United States, more than having friendly countries, has had allied countries that serve its interests, Landa points out. He also adds that this policy is handled in a "perverse way because on the one hand they promote the exploitation of our natural resources and at the same time, given the risk of an increase in the migratory phenomenon, they force our own countries to become their keepers and to enforce invisible walls that control migration and this is nothing more and nothing less than this plan of the Alliance for the Prosperity of the Northern Triangle of Central America, which is Honduras, Guatemala and El Salvador, where one of the principles is that each of these countries become safe countries for migration.”

The ERIC-SJ researcher questions, “How is it possible that Honduras has signed on to be a safe third country for migration when we are the country expelling migrants and that it is the second most important source of foreign currency income in the country? It has done so because we are the backyard of the United States and the United States forced the government to sign this treaty in order to obtain those funds that are supposedly being provided for security and development.”

The environmental defender concludes, “they create the conditions to guarantee their well-being; in this case, they guarantee their energy supply and at the same time put the countries that they are destroying to be the ones to take care that migrants do not continue to go in this disproportionate measure to the United States.”

Landa's reflections on the Safe Country Agreement were espoused before the new Democratic government of Joe Biden’s February 6 announcement of the suspension of the Asylum Cooperation Agreements with the governments of El Salvador, Guatemala and Honduras.


In January 2020, the Central Bank of Honduras (BCH) published the report Results of the Semiannual Survey of Family Remittances, which establishes that Atlántida is the third department with the highest number of remittance beneficiaries as residents, only preceded by Cortés and Francisco Morazán. The data is not isolated, reviewed the documents released on the subject by the BCH from August 2017 to January 2020 and the pattern is repeated.

In the case of Arizona, head of the research for the Broad Movement for Dignity and Justice (MADJ), Juan Antonio Mejía Guerra, explained to this medium that migration in Arizona is high, "at this point there are few families that do not have a family member who has not had to emigrate.”

Mejía Guerra adds that, in this municipality, "three out of every four people are poor, six out of ten people of working age do not have a job." He is remarking that both the municipality of Arizona and the department of Atlántida are becoming exporters of labor and exemplifies this with the situation of children in the area. "You are a boy or a girl, you reach adolescence and you have to leave your department because it does not give you any life options."

While the IDB and the US financial corporation DFC declare that the joint financing of 74.1% of the Jilamito Hydroelectric Project is part of a package destined to address the crisis triggered by the Covid-19 pandemic and the damage caused by hurricanes Eta and Iota, the MADJ researcher evaluates ​​these statements as "totally false" and that they seek to mold the Honduran water situation to "adapt it to the interests of neoliberal extractive capitalism."

Mejía Guerra delves into the subject and emphasizes that “it is not true that the financing of dams entails development, it entails the enrichment of a business caste and entails the accumulation of ownership of natural assets in some powerful families of these villages plus other transnational companies that are after the water business, now that it has been turned into a commodity.” Without taking into account that the consumption of water in these communities is seriously compromised and that, although they have pipes on paper, the vital liquid is usually rationed to four hours two or three days a week in the municipality’s capital.

“That's where the point of disagreement lies. People say: it is not that we are opposing the production of clean energy, what happens is that we have our own priorities and the first priority is that the municipality of Arizona has permanent, true, accessible, affordable water services, with all the characteristics that the human right of access to drinking water and sanitation entails, as established by the UN,” said the MADJ representative.

Regarding the generation of employment by the hydroelectric plants, the interviewee recognizes a slight production of employment, but the number is minimal and the majority occurs during the construction of the dam in a period of one or two years. In the long term, the workforce is reduced to six percent of that initially employed during construction for a period of between twenty to forty years, and the positions are restricted to cleaning, janitorial and guard duties. "In these terms it is a lie that a hydroelectric project is going to generate real economic development with social justice for the populations where these projects are installed," says Guerra.

At the end of December 2020, Martín Fernández of the Broad Movement for Dignity and Justice (MADJ) shared with documentation that details that of every one hundred lempiras that hydroelectric companies receive, only 20 cents go to the municipality, qualifying this fact as laughable.

Coordinator of MADJ, Martín Fernández, with officials from the OHCHR visiting the area to hear from residents.

In the MADJ documentation regarding the municipality of Arizona, the Central American Energy Company (ECAE) in the Matarras river or Ulúa phase I, collected 231 million 723 thousand 554 lempiras with 49 cents, of which only 897 thousand 719 lempiras with 49 cents were paid to the municipal coffers of Arizona between 2012 and October 2020. In the case of the Sociedad Eléctrica Mesoamericana Sociedad Anónima (SEMSA) [it shares a partner with INGELSA] in the Mezapita River, since 2016 it collected 689 million 311 thousand 991 lempiras with 68 cents and paid the municipality a total of one million 563 thousand 373 lempiras with 44 cents.

Mejía Guerra adds that "while the kilowatt hour is produced at a cost of two cents on the dollar, these companies are paid at 18 cents on the dollar." Added to this, the contrast between the earnings of the hydroelectric companies and what they pay to the municipalities is "the face of the vicious, cruel and murderous assault that the hydroelectric companies are carrying out on the communities of Honduras." A pattern that is repeated in La Masica, another municipality in Atlántida that has three more hydroelectric concessions, as does Arizona.

While this is happening, the residents who oppose the construction of new hydroelectric projects in Atlántida face the militarization of their territory by the Armed Forces and the National Police, as happened in the municipality of San Francisco. "They have become private armies at the service of these types of entrepreneurs and against the communities." The purpose? To prevent "populations from monitoring, caring for, watching over their river so that businessmen can do theirs upstream," says the MADJ researcher.

The engineer Mejía Guerra says that “these projects are not in line with popular community sentiment. In what sense? It's not that communities don't need energy. Arizona has three hydroelectric projects underway and people continue to pay the same cost, even though it is a municipality that is producing a surplus. This is a clear example of how these projects do not directly benefit the communities.”

In the end, the people of Arizona ratify their position that the Jilamito River is not negotiable and should be used as a source of water for the sixteen communities in the municipality that depend on it; while the government and businessmen receive crucial financial support of US $56,000 million from the IDB and the US financial corporation DFC for the construction of the Jilamito Hydroelectric Project.


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