World Bank must pay for Guatemala ‘terror loans’

In the late 1970s and early ‘80s, Guatemala’s people lived through one of the most brutal periods of the twentieth century – a government-run terror campaign that turned the country into horror film.

Recent research by Jubilee Debt Campaign has found that International Financial Institutions like the World Bank played a key role in financially backing the ‘terror governments’ of this period.

One particular project stands out – the Chixoy Hydroelectric Dam. Funded mostly by
the World Bank and the Inter-American Development Bank, the preparation and construction of this dam was a major factor in the massacre of 400 people, mass displacement, torture, rape and starvation. Despite these horrific events, the World Bank gave further support to the project seven years later.

It has been accepted by those who funded the Chixoy Dam that affected communities must receive reparations. But despite a long negotiation, they have yet to receive any compensation.

Guatemala remains a highly impoverished and unequal country, its people subject to high levels of violence, discrimination and human rights abuses. Much of the blame for this can be laid at the door of those Western governments and institutions that undermined democracy and plundered the country’s resources for decades.

As Guatemala is increasingly opened up to mining through a series of mega-projects, we must hold the World Bank and Inter-American Development Bank to account for its activities in the country – and say Guatemala needs a very different form of development to that propounded by the Banks.

You can find out more and read the report, ‘Generating Terror’, from Jubilee Debt Campaign here.

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