Europe

MPs attack export credit proposal for Turkish dam

MPs yesterday launched a devastating attack on the Foreign Office and Department of Trade and Industry over provisional plans to use export credit guarantees to support a controversial Turkish dam project.

MPs yesterday launched a devastating attack on the Foreign Office and Department of Trade and Industry over provisional plans to use export credit guarantees to support a controversial Turkish dam project.

The cross-party international development committee said it was “astonished” that the Foreign Office had not objected on human rights grounds. It accused the DTI of “the worst form of export credit practice”.

Stephen Byers, the trade and industry secretary, said last December that he was “minded” to approve a Pounds 220m guarantee for Balfour Beatty, which is part of an international consortium bidding to build a dam at Ilisu, on the Tigris river.

Mr Byers said then that the Export Credits Guarantee Department would underwrite the contract only if Turkey met conditions on environmental issues and resettlement of the mainly Kurdish local population.

However, the committee said neither the Foreign Office nor the DTI appeared to have considered seriously the rights of local people, or the possible consequences of a dispute over the dam with Iraq and Syria. It said Mr Byers should have insisted that conditions were met before announcing provisional approval.

“The shotgun wedding approach to export credit that we find in the case of the Ilisu dam does not in our view bode well for the implementation of commitments, but is rather the worst form of export credit practice,” it said. The dam “was from the outset conceived and planned in contravention of international standards, and it still does not comply. For that reason cover should not be given”.

The Turkish government says the dam is required to provide electricity. It denies that it will damage the environment or local people. A report on Turkey’s compliance with the DTI conditions is expected later this year.

The committee also called for companies convicted of bribery or corruption to be blacklisted by ECGD, noting that 36 of 54 companies declared ineligible for World Bank-financed contracts were British.

Balfour Beatty is not on the World Bank list. It is, however, a partner in a French-led consortium in Lesotho that is charged with corruption offences, all of which are denied.

The company said no contracts had been signed. “We are not the promoters of the dam, we are part of the process that will get it built according to proper standards, or it will not be built,” it said.

Friends of the Earth said the report “vindicates every criticism we have made of this miserable project”.

The Foreign Office said the committee’s criticism was “unfounded”, while the DTI said Britain was helping to raise standards for Ilisu.

Kevin Brown, The Financial Times, July 13, 2000

Categories: Europe, Odious Debts, United Kingdom

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