Lidl has received nearly $1 billion from both institutions in loan funding to expand its operations in Eastern Europe.
Owned by the Schwarz Group, Lidl is Germany's richest private family-owned German retail group, which owns and operates both the Lidl and Kaufland brands. The group achieved a turnover of $75 billion (€67.6 bn) in 2012/2013. It operates over 10,000 branches across 20 countries.
The funding comes from the International Development Association of the World Bank, which is largely funded by repeated contributions of 45, mostly developed, countries. Other funding comes from the EBRD, which is owned by 64 countries as well as the European Union and the European Investment Bank (EIB). Ultimately, both organisations are backed by taxpayers.
The rationale behind lending $900 million to a multinational giant like Lidl is that the loan funds enable the company to expand its operations in Eastern Europe to create jobs and boost the economy as well as to bring food at a competitive price to the poorest.
However, critics disagree. Luiz Vieira, coordinator of the Bretton Woods Project, a British NGO that monitors the World Bank, told the Guardian: "This idea that an injection of capital to multinationals will lead necessarily to good, sustainable growth has been repeatedly proven false over the last 20 years."
Workers' Rights Violated
Lidl has also been slammed for its poor record on workers' rights. There have been demonstrations for months in Poland, where Solidarity Union members have organized pickets and distributed leaflets to customers informing them about the difficult working conditions and violation of workers and unionist rights of people employed in Lidl.
Dominik Kolorz, President of the Silesian Region of Solidarity said that in Germany, where Lidl's headquarters are located, nobody would dare treat workers in such a bad way like they do in Poland and dismiss Union leaders from work.
"Why do Lidl managers in Germany respect the law and treat Poland unfairly? We can't agree for treating Poles, workers and unionists like slaves, we can't stay silent while they ignore the law," he said.
