By Witness Radio Team.
Germany’s state-owned development bank, KfW, is facing heavy criticism after a new report exposed how its financing is linked to land grabs, community repression, and human rights violations across the Global South. This injustice is being perpetrated against community members and human rights defenders who, in the face of such adversity, continue to oppose projects linked to KfW bravely.
The report, titled Irresponsible Banking and produced by the Coalition for Human Rights in Development, is not just a crucial revelation but a significant milestone in the fight for justice. It uncovers that while KfW projects are branded as sustainable and pro-development, their impacts tell a darker story of dispossession and violence.
KfW, which operates through its subsidiaries KfW Development Bank, DEG, and IPEX-Bank, is one of the World’s most prominent development financiers. It is backed entirely by the German state. The German government, as the sole shareholder of KfW, has a direct responsibility to ensure that the bank’s operations align with international human rights standards, including the UN Guiding Principles on Business and Human Rights and Germany’s own Supply Chain Due Diligence Act. On paper, the bank promises to uphold strict environmental and social safeguards, respect the rights of Indigenous Peoples to Free, Prior, and Informed Consent, and protect communities from harm. In practice, however, the report finds that these promises remain an empty rhetoric.
According to the findings, several sources interviewed for this analysis, as well as reports by other human rights organizations, denounce the adverse human rights impacts of KfW-funded development projects. In particular, there are numerous cases of threats and attacks against HRDs and community members who oppose KfW-funded projects.
Communities affected by these projects are rarely given adequate information, and when consultations take place, they are frequently rushed, manipulated, or conducted in languages people cannot understand. Far from protecting Indigenous rights, the bank’s operations often sideline them altogether, leaving communities vulnerable to loss of land, culture, and livelihoods.
KfW is funded with public money and is meant to serve the public good. Instead, its negligence has left a trail of suffering. By allowing projects to proceed without proper safeguards, the bank is complicit in dispossession, violence, and environmental destruction.
“KfW calls it ‘responsible banking’, but it’s using German taxpayers’ money to bankroll projects that displace Indigenous Peoples, destroy ecosystems, and endanger human rights defenders. If KfW wants to demonstrate real responsibility, it needs to listen to local communities and ensure their voices are not silenced”, says Dalile Antunez, the report’s author and researcher at the Coalition for Human Rights in Development.
The consequences are visible in case after case. On Indonesia’s Flores Island, the Ulumbu Geothermal Plant expansion, financed with KfW support, is tearing through Indigenous Poco Leok land. Sacred sites and ancestral graves have been desecrated—local activists who resist report surveillance, intimidation, and even physical attacks. Mr. Jimmy Ginting and his fellow activists are fighting against the planned expansion of the Ulumbu Geothermal Power Plant in Poco Leok, which is being implemented by Indonesian state-owned utility company PLN Limited Liability and financed by a KfW loan. The project, which is being implemented without the Free, Prior, and Informed Consent of the Indigenous community, is a clear violation of their rights.
“By not stopping their financing of the project, KfW is actually complicit in human rights violations in Poco Leok,” says Jimmy Ginting, a local human rights defender who has been supporting the struggle of the Indigenous community in Poco Leok.
In Mexico, KfW financing has supported the Topolobampo Ammonia Plant, a project threatening critical wetlands and the livelihoods of fishing communities. Fisherfolk warn that their waters are being poisoned, their future stripped away. Yet the bank’s money continues to flow.
In Sinaloa state in Topolobampo, Mexico, KfW is working together with the company Gas y Petroquímica de Occidente S.A., by financing the construction of their ammonia plant that produces fertilizer. Ms. Claudia Susana Quintero, who founded the collective ¡Aquí no! that is opposing the Mexican project, reported on their experiences and described the project impacts and reprisals they face.
“The ecological damage brought by the project is immense and irreversible. We are told that a loss of over 60 % of local species can be observed, not to speak of the health risks, caused by the poisonous steam from the ammonia plant and the destruction of the residential fishing site that 4000 families depend on.” She revealed during the report launch webinar, which was also aired live on Witness Radio airwaves.
KfW’s investment is now further dividing our communities. From divisionism to criminalization, reports Ms Quintero, who has been fighting for the rights of the indigenous population and nature for 11 years.
“The ecological effects are immense, but the effects on the community cannot be quantified as well. The company did not offer comprehensive information about the impacts beforehand. It had already entered and divided the community before we could organize ourselves and insist on our right of inclusion. Opposing members of the community are confronted with death threats, physical violence, and criminalisation. We were free before that, but now my family and I live in fear of retaliation. Our lives don’t mean anything to them. I go to sleep every day, thinking that one day my children and I will not wake up again.”Quintero added.
In Tanzania’s Mahenge district, the Epanko Graphite Mine, backed by DEG, another KfW subsidiary, has raised alarm over forced displacement, land loss, and reprisals. Local voices critical of the mine speak of harassment and intimidation, echoing the same pattern of neglect and abuse found in Indonesia and Mexico.
What ties these cases together is not only the harm caused but also the silence of a bank that should be protecting people, not exposing them to danger. The report highlights how KfW has no robust policy to deal with reprisals against activists. Human rights defenders who speak against destructive projects face threats, beatings, and lawsuits, while the bank looks the other way. Its lack of transparency exacerbates the problem, as affected communities often cannot access critical information about the projects that are reshaping their lives.
In a video message during the online launch of the report, Dr. Pichamon Yeophantong, a member of the UN Working Group on Business and Human Rights, underlined the special obligations of development banks (DFIs), like KfW. As official agents and an essential part of international development cooperation, they are obligated to act responsibly and fulfill specific moral standards in alignment with the United Nations’ guiding principles on business and human rights.
The Coalition for Human Rights in Development is calling on KfW to take urgent action. The report recommends that the bank adopt a strong and enforceable anti-reprisals policy that includes systematic risk assessments and immediate protection measures when threats emerge.
It urges KfW to guarantee genuine Free, Prior and Informed Consent for Indigenous Peoples, ensuring that they have the right not just to be consulted but to say no to harmful projects. Transparency must be drastically improved, with all project information disclosed in local languages and in accessible formats.
Monitoring must become independent, and accountability mechanisms must be strengthened to provide real remedies when rights are violated. Finally, the report stresses that when harm persists, KfW must be prepared to suspend or withdraw financing rather than continue enabling abuses.