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	Overview of the Problems
	Highlight: Russia's Sakhalin II
	Highlight: The BTC Pipeline

What's New! Vol. 5, No. 10

October 2006

"What's New!" is a periodic update to keep you informed of the latest on the ECA Watch website. What's New! features a wide range of materials related to the reform of Export Credit Agencies (ECAs) including NGO publications and releases, news articles, commentaries and announcements about the policies and practices of ECAs and ECA-financed projects world-wide. If you would like to receive "What's New!" simply add your e-mail to the ECA-Action list at www.eca-watch.org today! Questions? Email info-at-eca-watch.org

1)	European Commission investigates French nuclear export credits
2)	OECD Export Credit Updates
	A.	Review of the Common Approaches on Environment and export credits
	B.	More questions re OECD export credit monitoring statistics
3)	Ilisu Dam update
4)	Yusufeli Dam going ahead
5)	Belgian ECA's private insurance subsidiary questioned in European Parliament
6)	Vietnamese and Philippino airlines expand fleets with ECA support
7)	Russian arms exports and export credits
8)	Chinese export credits and environmental impacts
9)	African Trade Insurance Agency
10)	AFRODAD workshop on ECAs and African debt in Cameroon
11)	Rheebu Nuu files injunction in Paris to halt Goro Nickel construction
12)	ECAs fund coal fired power in Botswana / South Africa
—	View Back Issues of What's New

1.	European Commission investigates French nuclear export credits
	(Forbes, Brussels, 24 Oct. 2006) The European Commission confirmed it is launching an in-depth investigation into the guarantee that French government [export credit] insurer Coface has given Areva and its Framatome-ANP unit for the funding for a European pressurised water nuclear reactor in Finland.

2.	OECD Export Credit Updates
	A.	Review of the Common Approaches on Environment and export credits
		OECD ECAs will enter another round of negotiations on a revised Recommendation on Common Approaches on Environment and Export Credits during the week of November 13th, 2006. A draft text has been shared with ECA Watch for comment, a welcome indication of increased transparency on the part of the OECD Working Group on Export Credits. ECA Watch is extremely concerned however, that while negotiations are underway, a number of ECAs are actively considering support for projects such as the Ilisu and Yusufeli dams in Turkey, the Sakhalin II oil and gas project in eastern Russia and the Camisea II pipeline and LNG project in Peru. Their own consultants and EIAs clearly show serious violations of the existing Common Approaches standards which would trigger the derogation clause in the Recommendation if they approve the projects, risking the credibility of the whole review process. ECA Watch has also learned that some ECAs are pressing for improvements, while certain others are actively lobbying for the removal of a number of improvements currently in the draft text.
	B.	More questions re OECD export credit monitoring statistics
		(ECA Watch, Paris, 30 October 2006) Weak or non existant OECD peer review of ECA subsidies due to undervalued premiums and interest rates would appear to jeapordize OECD and WTO provisions that require ECAs to break even in the long run.

3	Ilisu Dam update
	(European Parliament, Strasbourg, 27 September 2006) Paragraph 26 of a just approved European Parliament report calls on Turkey to apply EU environmental standards to the Ilisu Dam and other high impact projects. The Iraqi Water Resources Minister has expressed his concerns about the dam to ECA Watch members and asked that the German, Swiss and Austrian ECAs considering support for the project be advised of these concerns.


4	Yusufeli Dam going ahead?
4	(Berne Declaration, Zurich, 9 October 2006) A review of the Yusufeli environmental impact assessment (EIA) prepared for the Berne Declaration and Friends of the Earth France notes that it does not comply with World Bank EIA standards. The above noted European Parliament report calls on Turkey to apply EU environmental standards to the Yusufeli Dam and other high impact projects such as Ilisu.

5	Belgian ECA's private insurance subsidiary questioned in European Parliament
5	(European Parliament, 14 July 2006) Belgian MEP Bart Staes (Verts/ALE), tabled a question in the European Parliament asking whether this company might constitute an illegal subsidy under Article 87(1) of the EC Treaty. The Commission has replied (only in French) that it will make enquiries of the Belgian government and inform the Honourable Member.

6.	Vietnam and Philippine Airlines expand fleets with ECA support
6.	(Thanhnien News and INQ7 Networks, 28 & 20 October 2006 respectively) Vietnam Airlines and Philippine Airlines have announced plans to borrow some US$500 Million each to expand their fleets, with financing to come largely from export credit agencies.


7.	Russian arms exports and export credits
7.	(People's Daily Online, 19 October 2006) Indonesia has agreed to purchase 6 submarines and other weapons from Russia following the offer of a US$1 Billion export credit. Russia surpassed the United States in 2005 as the leader in weapons deals with the developing world.

8.	Chinese export credits and environmental impacts
8.	(ECA Watch, Paris, 30 Oct. 2006) OECD ECAs have frequently pointed to lax Chinese export credit standards as a reason to not tighten their own lending criteria in order to remain competitive. Increased attention is being paid to China's external environmental impact as well as to serious environmental problems in China.

9.	African Trade Insurance Agency
9.	(Coastweek Newspapers, Kenya, 27 October 2006) The African Trade Insurance Agency (ATI), Africa's only multilateral import and export credit agency has held a two day trade and finance clinic in Lusaka, Zambia where they met various officials from government and the private sector including importers/ exporters and exchanged notes on how they could benefit from the agency.


10.	AFRODAD workshop on ECAs and African debt in Cameroon
10.	(AFRODAD, Harare, 19 October 2006) AFRODAD, a civil society organisation working to secure lasting solutions to Africa's mounting debt problem, hosted a successful workshop on ECAs and African debt in Yaounde, Cameroon on October 17-18, 2006. Interviews with participants appeared in the Cameroon Tribune and Le Quotidien Mutations

11.	Rheebu Nuu files injunction in Paris to halt Goro Nickel construction
11.	(Mineweb.com, London, 26 October 2006) Rheebu Nuu, a New Caledonian environmental group, has sought an injunction, on environmental grounds, to halt construction at CVRD-Inco's Goro nickel plant. The hearing, held Oct.25th, was adjourned until November 5th for both sides to provide more information – with the judgement expected on November 15th. Cia. Vale do Rio Doce (CVRD) paid $13.3 billion to acquire control of Inco putting the Brazilian company on course to become the top nickel miner by 2009.

12.	ECAs fund coal fired power in Botswana / South Africa
12.	(Miningmx.com, South Africa, 18 October 2006) The debt portion of a US $5.5 Billion coal mining and power station project in Botswana on the border with South Africa will likely be syndicated on a non-recourse basis to export credit agencies and banks. While offering potential industrial development, global warming from carbon emmissions threatens a cataclysmic effect on the global economy according to a just released report from the head of the British government's economic service and a former chief economist of the World Bank