January 11, 2001

EDC’s Ian Gillespie responds to Patricia Adams’ letter regarding EDC’s accountability and its adherence to the findings in the World Commission on Dams report.

Ms. Patricia Adams
Executive Director
Probe International
225 Brunswick Avenue
Toronto, Ontario
M5S 2M6

Dear Ms. Adams:

I am in receipt of your letter dated November 30, 2000 regarding the World Commission on Dams (WCD) report. The WCD report is a very interesting document and it contains a number of useful recommendations.

Regarding your specific comments, and for the purposes of clarification, the WCD recommended that public and private developers, financiers and consultants involved in dam projects in all stages of the planning and development process give high priority to reviewing transaction proposals against the framework provided in the WCD report (p. 312 and 313). The recommendation regarding the review of existing procedures and regulations concerning large dam projects was addressed to national governments, not export credit agencies, as was the recommendation to establish an independent, multi-stakeholder committee to address the unresolved legacy of past dams (p. 313).

The recommendations directed specifically at ECAs, which are contained on p. 316 of the WCD report, are as follows:

• Introduce and adopt common environmental, social and trans-boundary criteria for financial guarantees and strengthen institutional capacity to appraise projects against such criteria;
• Improve co-ordination among agencies at the international level to ensure that dam projects refused by one agency are not accepted by others;
• Require private-sector applicants for dam projects to meet due diligence criteria or voluntary codes of conduct that conform to the Commission’s recommendation; and

• Promote consultation and information disclosure as normal procedure.

As you know, EDC and the Government of Canada have been strong proponents of, and are now engaged in, negotiations at the OECD to develop common approaches to environmental review among export credit agencies. Consultations have already been held on the report with a WCD representative, and we fully expect the WCD’s recommendations to be discussed further during the OECD negotiations. In general, we believe the WCD recommendations for export credit agencies to be a very thoughtful and helpful contribution to the negotiations.

Internally, EDC already possesses the largest team of environmental specialists of all ECAs. We are continually reviewing and strengthening our environmental processes to enhance the capability of the corporation to appropriately identify and assess these risks, as well as to provide monitoring throughout the project life where EDC is a significant participant.

In your letter, you also requested information on EDC involvement in dam projects past, current, and those under consideration. We are currently working on a disclosure policy that will guide EDC in disclosing such information. Both the Environics report on public consultations and the draft outline of the disclosure policy are available on EDC’s web site. It is our intention to make the draft disclosure policy available to the public for comment prior to formal adoption by EDC’s Board.

Yours sincerely,

cc: Mrs. Andrée Delagrave, Chair, Access to Information Review Task Force
Mr. L. Denis Desautels, Auditor General of Canada
Mr. Robert Wright, Deputy Minister for International Trade
Mr. Kevin Lynch, Deputy Minister of Finance