What's New Items 2002-2004 Compiled

December 7, 2004 (The Guardian, UK) - The UK’s sale of 100 Scorpion tanks to the brutal and corrupt Suharto regime in Indonesia points to the ease with which “ethical foreign policy” goals can be abandoned. The tanks, later used against independence fighters, were covered in part by the UK ECA Export Credits Guarantee Department (ECGD). A December 10, 2004, Guardian article reported a development in the Scorpion tank scandal: investigations have begun into an alleged bribe paid to Suharto’s daughter to secure the tank deal.

B. Trade Secretary Now Facing Review for Weakening Corruption Controls

December 2, 2004 (The Guardian, UK) - The ECGD weakened its new anti-corruption standard on the demand of Trade Secretary Patricia Hewitt, and she is now facing a judicial review for her actions, which followed intense lobbying by BAE, Airbus, and Rolls-Royce. On November 30, 2004, the BBC ran an article and a TV news investigative report (read the show’s transcript (PDF)) on the ECGD corruption scandals, including the cases of India’s Dabhol and Nigeria’s Bonny Island projects.

C. Legal Challenge Ahead for UK ECA

November 20, 2004 (Financial Times) – Having backtracked recently on its new anti-corruption rules following an intense lobbying campaign by British-based multinationals, the UK ECA Export Credit Guarantee Department (ECGD) now faces a legal challenge by anti-corruption campaigners. BAE, one of the companies which lobbied for relaxing anti-corruption rules, is under investigation for a Saudi Arabian deal; a UK Halliburton subsidiary is also under investigation for bribes Halliburton acknowledges it “may have” paid to Nigerian officials to secure a construction project [on Bonny Island], a project also backed by the ECGD. Read the ECA Watch “What’s New” October 2004 update on the Bonny Island scandal.

2) Recent News on the Baku-Tbilisi-Ceyhan (BTC) Pipeline

A. BTC Pipeline to Exceed Costs

November 15, 2004 (Trend, Azerbaijan) – The head of SOCAR [the State Oil Company of the Azerbaijani Republic] Natiq Aliyev announced that the Baku-Tbilisi-Ceyhan (BTC) Pipeline, now in its final stages, will cost more than previously thought. Aliyev stated that “the possible "5 to 7 per cent" appreciation of the project is not the fault of sponsors or contractors, but because "[t]he BTC pipeline has very strong adversaries who are using all possible and impossible tricks in an attempt to hamper its implementation.” The pipeline is backed by private and ECA interests, primarily the UK’s BP and ECAs from Europe and the US.

B. BTC Pipeline Riddled with Corrosion

November 17, 2004 (AFX Europe) – According to a study by the US consulting firm WorleyParsons, 1,260 joints in one section alone of the Baku-Tbilisi-Ceyhan (BTC) pipeline have been found to be defective due to corrosion. The US firm investigated the BTC link at the request of lenders after speculation at the beginning of 2004 that BP, the UK ECA ECGD, and other project partners had run into trouble. Derek Mortimore, the former consultant to BP, described decisions made with regard to pipeline coating technology as "appalling."

C. UK Admits Pipeline Failure Due to Experimental Engineering

November 23, 2004 (Baku Ceyhan Campaign [comprising PLATFORM, the Corner House, KHRP & Friends of the Earth]) – Senior UK government officials admitted in a parliamentary inquiry that the vital anti-corrosion coating system for the Baku-Tbilisi-Ceyhan pipeline project had no track record, contrary to assurances given to MPs in June by the UK Energy Minister. The Trade and Industry Select Committee began its probe after revelations in the press that BP, the operator of the project, had ignored internal warnings that their coating would fail to to seal the pipeline’s welds from corrosion. The weld coating cracked last winter. BP secured USD $2.6B in loans from international private and development banks without disclosing this major design flaw. The UK ECA, the Export Credits Guarantee Department (ECGD) is backing the pipeline with £60M public money. Read an explanation of the coatings on the pipeline by the Baku Ceyhan Campaign.

D. Exxon Spurns BTC Pipeline for Trains

November 25, 2004 (The Times, UK) – Just as BP’s mammoth BTC pipeline is almost complete, ExxonMobil declared the project to be too expensive: it now plans to export its Caspian oil via rail tankers to a Black Sea port.

E. Italian Bank Pulls $60M Funding from BTC

December 8, 2004 (The Messenger, Georgia) – The Italian bank Banca Intesa has decided to divest its USD $60M from the BTC pipeline, adding to the setbacks already plaguing the pipeline. Read the investigative report “The Con-tract of the Century” on the Intesa divestment and BP’s coverup of the design flaws that caused the bank concern. Also read the December 1, 2004, press release by the Baku-Ceyhan Campaign on the Intesa divestment.

3) Recent News on the Russian Oil and Gas Project Sakhalin II

A. Shell’s Sakhalin II Charm Campaign Overstates Benefits to Russia

November 30, 2004 (Source: the Sakhalin Campaign of CEE Bankwatch Network, FOE, Pacific Environment, PLATFORM, SEW & WWF) – An independent study by a leading energy economist has documented the Sakhalin II Production Sharing Agreement (PSA) to be a major departure from standard PSA terms worldwide. The study reports that “[t]he benefits which flow to the Russian party fall a long way short of those which would have been received had a standard type PSA been used [in which] the Russian party would receive 45% more economic rent.” Shell recently launched a charm offensive to boost the controversial Sakhalin II project, extolling the financial benefits to Russia. Sakhalin II is seeking up to USD $5B in public financing from the Export Credit Agencies of the US, UK, and Japan, and the European Bank for Reconstruction and Development. Read the Profit Sharing Analysis “The Sakhalin II PSA - a Production 'Non-Sharing' Agreement” (PDF).

B. Sakhalin’s Indigenous People Plan Protests of Oil and Gas Projects

December 8, 2004 (Sakhalin Independent, Russia) – Sakhalin Environmental Watch has reported that Sakhalin’s indigenous people have threatened to start ongoing blockades of roads, bridges and pipeline routes constructed by Sakhalin Energy, Exxon Neftegas Limited, British Petroleum and Rosneft-Sakhalinmorneftegas. The resolution to start protesting was passed at the Congress of Sakhalin’s Indigenous People, which was held on October 29th.

C. Sakhalin II Pipeline Soils Water in Korsakov, Russia

November 12, 2004 (Vladivostok News, Russia) - Construction of a pipeline for the Sakhalin II project near the town of Korsakov threatens to disrupt water and heat supply to the city, since water reservoirs located near the pipeline route have been contaminated with construction site runoff.

4) Recent News on OPIC

A. OPIC Sues Indian Government Over Dabhol

November 19, 2004 (Financial Express, India) – The US government’s Overseas Private Investment Corporation (OPIC) has initiated arbitration against the government of India for breach of investment incentive agreement and the recovery of its claims of USD $110M on the Dabhol Power Company over a stalled hydopower plant project. OPIC has paid over USD $110 million on political risk insurance policies covering the investors (GE and Bechtel) and Bank of America against the risk expropriation of their investment in the project. Read OPIC’s Request for Arbitration (PDF).

B. OPIC Promises $250M in Support to Israeli Gas Pipeline

November 22, 2004 (GLOBES, Israel) - OPIC has announced approval of USD $250M in political risk insurance for the construction of a 65-mile pipeline that will serve as the centerpiece of Israel’s natural gas system. OPIC’s insurance will cover a proposed loan arranged by Citigroup for the construction of a pipeline that will be used to transport natural gas produced offshore, from Ashdod in southern Israel to Dor in the north, for downstream power projects in the country.

5) Recent News on the Japanese ECA JBIC

A. JBIC Pledges $220M to Indonesian Power Plants

November 26, 2004 (VNA, Vietnam) - The Japanese government, through the Japan Bank for International Cooperation (JBIC), plans to extend an export credit worth 2.75B yen (USD $220M) to help Indonesia improve the capability of its power plants.

B. JBIC Looks Toward Mining

November 13, 2004 (Daily Times, Pakistan) – The Japanese ECA JBIC notes a rising demand for funding for now-affordable international metal mining projects by Japanese metal refiners. “The need for funds in development projects is increasing ... and I expect bigger growth in the future,” said Katsuhiko Okazaki, Director of Natural Resources Finance at JBIC. “In order to meet changes in the environment with demand led by China and India, some smelters are increasingly seeking opportunities to take stakes in mining projects.”

6) Recent News on the Russian ECA and Foreign Trade Bank

A. Russian Vneshtorgbank Makes Agreement with Korean ECA and with Canadian ECA

November 28, 2004 (Pravda) Russia's foreign trade bank Vneshtorgbank (VTB) has entered into an agreement with the Export-Import Bank of Korea. In an earlier, November 10, 2004, article on the deal, Pravda added that it was possible that the Russian gas giant Gazprom was interested in purchasing Korean equipment, and would be among VTB's customers to use the proposed USD $30M line of Korean credit. In a related December 2, 2004, RIA Novosti article, VTB has entered into an agreement with Canada’s ECA Export Decelopment Canada (EDC) and will open a USD $50M credit to Vneshtorgbank to finance contracts on exports of Canadian goods and services to Russia.

B. Russian and Indian ECAs Enter Into Agreement

November 18, 2004 (Economic Times, India) – India’s ECA Export Credit Guarantee Corporation (ECGC), Russia’s ECA ExIm (ExIm Bank of Russia), and the Russian bank Vnesheconombank (VEB) have signed a Memorandum of Understanding to promote trade between the two countries as part of a project in a third country. Another article on the subject on December 3, 2004, (The Hindu) added that in this new economic partnership there has been a substantial and new emphasis on the fields of information technology, banking, and energy. In the energy sector, the Gas Authority of India Ltd (GAIL) will collaborate in Russia, India and third countries on underground storage projects (with STROITANSGAZ) and exploration and delivery of natural gas (with GAZPROM). GAIL and Russian company Skonchinsky Mining Institute have also decided to develop a pilot project on lignite (brown coal) gasification in Tamil Nadu and Rajasthan.

7) Qatar LNG Company Receives $930M in Support from US ExIm Bank

November 18, 2004 (Source: US ExIm Bank via PR Newswire) – The ECA US Export-Import Bank has approved a loan guarantee of up to USD $930M to support US exports to supply Qatar Liquefied Gas Co. Ltd. II (Qatargas II) in its development of a liquefied natural gas (LNG) project in Qatar.

8) French ECA COFACE Uncertified for Three Years Running

December 9, 2004 (Source: Friends of the Earth- France [press release in French]) - The highest-ranking financial public institution in France (Cour des Comptes or Court of Accounts), which has jurisdiction over the financial affairs of the French public sector and is charged with auditing government spending, has now refused to certify the public bank account for the French ECA COFACE for three years.

View Back Issues of What's New:

2004 What's New Items

V3N9

1) OPIC and ExIm Bank Sued by Arcata, California

November 10, 2004 (The Lumberjack Online ) – Arcata, California , has joined Oakland, CA, Boulder, CO, Greenpeace and Friends of the Earth in a suit against the two major export credit and investment finance agencies of the US . The city seeks damages expected to the community mainly from an increased sea-level due to greenhouse gasses. “They take federal money and make investments and they are not held to the same environmental standards as projects in the United States ,” said Mark Andre, Deputy Director of Environmental Services for the City of Arcata .

2) French ECA COFACE Plans to Back Finnish Nuclear Reactor

October 22, 2004 (Sources: Greenpeace- France and Friends of the Earth- France ) - Greenpeace and Friends of the Earth have voiced concern that the French ECA COFACE has decided, according to the COFACE project list for the 2nd Quarter of 2004 , to give 610M Euros to the French nuclear company Areva to export a 1600 MW European Pressurized Water Reactor (EPR) to Finland for use by operator Teollisuuden Voima (TVO). A December, 2003, press release from Greenpeace about the pending sale explains that this kind of reactor “ is claimed to be totally safe and the nuclear industry is hoping to start a new era of nuclear development with this design.” However, it continues, “There's nothing new to the safety appraisal of the EPR.” Read the COFACE abstract about the Areva reactor (PDF) .

Read an October 13, 2004, Reuters article about the plans for the TVO nuclear plant in Finland.

3) Canada’s ECA Funds SUAL Russian Aluminium Project

October 15, 2004 (Azom.com News) – Siberian Urals Aluminium or SUAL, one of the world's top aluminium producers, has closed an agreement with the ECA Export Development Canada (EDC) to provide $20M USD financing for the Komi Aluminium Project. In August IFC and EBRD joined private banks in backing this Russian project, pledging a 9-year $150M USD loan.

4) OPIC May Fund Alumina Refinery in Conflict-Torn Guinea

October 21, 2004 (IRIN, Africa Independent) – OPIC is expected to participate in a $2B USD alumina refinery in Sangaredi, Guinea . The refinery, to be built by a Japanese-held company, is next to the world’s biggest mining complex for bauxite, used to make aluminum. If the refinery goes forward, it will be the largest foreign investment project in West Africa since international oil companies- led by ExxonMobil- invested $3.7B USD to develop Chad ’s oil fields. The International Monetary Fund and World Bank have suspended aid and the EU has withheld large amounts of aid to totalitarian Guinea pending governmental democratic reforms and corruption safeguards.

5) UK ECA ECGD Backs Down on Corruption Controls

November 8, 2004 (The Guardian, UK ) – UK Government Ministers have been accused of a "spineless" climbdown on bribery and corruption controls on exporters in response to intense lobbying by the business sector. Campaigners fear that changes to the bribery controls of the UK 's ECA would encourage the "worst practice" by companies operating abroad. After the new rules were announced, Susan Hawley of the Corner House anti-corruption campaign said, "This is a spineless and disgraceful government response to industry pressure and shows who's really the boss at the ECGD." This news came days after an article from The Guardian (October 30, 2004) following up on the Nigerian Bonny Island / Halliburton corruption scandal , wherein bribes were paid through a UK office under ECGD’s watch. Also, read the ECA Watch “What’s New” October 2004 update on this scandal.

For more on the ECGD corruption control climbdown, read the UK Guardian’s Nov. 17, 2004, article on the corporate protests of existing ECGD corruption controls by Rolls-Royce, the Airbus Consortium and BAE Systems.

6) Philippines See Influx of ECA Interest in Power Sector

October 17, 2004 (Manila Bulletin) – Philippine power executives and the Philippine National Power Corporation privatization team are said to be planning a successful resolution of the current dilemma of the Philippine power sector. The resolution is aided by the influx of support by finance institutions such as the US ExIm Bank, IFC, Asian Development Bank and the Japan Bank for International Cooperation (JBIC), as well as others.

7) Finnish ECA Money Tied to Costa Rican Scandal

October 22, 2004 (Tico Times via Americas.org Website) – On October 21 st former Costa Rican President Calderón Jr. (1990-94) became the second former Costa Rican head of state arrested in a week. Calderón is alleged to be behind the illegal disbursement of a $9.2M USD “commission” tied to a $39.5M USD government contract for the purchase of medical equipment. The contract included a $32M USD loan from Finland (loaned via the Finnish ECA ODA: for more on this connection, read the NGO Finnwatch November 11 press release ).

8) Congress of World Wind Energy Calls for Export Credit Reform

November 4, 2004 (Source: WWEA Website) – The final resolution issued by the World Wind Energy Conference, held in Beijing, October 31 – November 4, 2004, calls for global ECA reform. Among its recommendations it includes “ the amendment of laws which disadvantage wind power generation projects particularly in the developing world such as the OECD provisions in relation to export credits... [and] the World Trade Organisation laws so that individual nations may make provision to prioritise Renewable Energy development…”

9) Belgian ECA Launches Improved Website

October 10, 2004 (Source: Proyecto Gato ) The Belgian ECA Ducroire/ Delcredere has launched an update to its website (http://www.delcredere.be) that is more compliant with the OECD’s Environmental Common Approaches for Export Credits . Ducroire’s policies on environment, corruption, indebtedness, and social issues can now be read on the site’s Ethics page .

10) FERN Assesses EU’s New ECA Transparency Directive

November 5, 2004 (Source: FERN) - FERN, a sustainable forestry NGO, has published a briefing paper “Blood from a Stone” on a new EU Directive on Public Access to Information, citing its potential advantages and limitations. It notes that while ECAs fall under the scope of the directive, “ a number of exceptions and loopholes in the text leave Member States with significant room for manoeuvre in the transposition process and could eventually allow ECAs to withhold certain types of information or delay the disclosure of material.” Click here to download the FERN briefing (PDF).

11) Pipeline Opponents Threaten Legal Action Against UK’s ECA

November 17, 2004 (The Independent, UK) – Opponents to the controversial Baku-Tbilisi-Ceyhan (BTC) oil pipeline being built by BP through central Asia warned the UK that it would face legal action if the pipeline caused an environmental disaster. For more information on structural and transparency breakdowns on the BTC pipeline, read the November 17, 2004, article by The Guardian, UK, “Cracked Joints,” as well as the October, 2004, What’s New item about BP’s profit margin and the Baku-Ceyhan project .

V3N8

1) Did Halliburton Bribe Nigerian Dictator on ECA-backed LNG Terminal?

October 3, 2004 - (The Independent - UK) A French corruption investigation has uncovered that a low-end UK lawyer worked with three British executives from the US construction group Halliburton to pay at least $132M USD in "unjustified" fees to contacts in Nigeria. These transactions, many of which took place when Halliburton’s CEO was Dick Cheney, the current US Vice President, helped a consortium including Halliburton to win a $12B USD contract to build a gas terminal at Nigeria ’s Bonny Island . T he discovery of Halliburton’s central role in the deal may force the Export Credit Guarantee Department – the UK ECA - to withdraw its support from a £133m loan made last year to MW Kellogg, a UK Halliburton subsidiary. The infamous Bonny Island terminal has been financed by the ECA of the US - the Ex-Im Bank- and several European ECAs.

Read our September 2004 update on corruption and the Bonny Island gas terminal.

Read our July 2004 update the environmental effects of the Bonny Island gas terminal.

2) Canadian ECA Chief Environmental Advisor's Report Shows Small Step Toward Accountability

September 16, 2004 – (Source: Halifax Initiative ) A Canadian coalition of development, environment, faith-based, human rights, and labour groups welcomed the release of Export Development Canada’s Second Annual Chief Environmental Adviser’s Report, but warned that this is only a small step towards ensuring greater public accountability for the Crown Corporation.

Read the full EDC Report (in PDF form).

3) Algerian Energy Sector to Receive Boost from Canada’s ECA

September 26, 2004 (Source: Public Affairs Office of the EDC) – The Canadian ECA, Export Development Canada (EDC) and Algeria’s state-owned energy company, Sonatrach, have signed a 500M USD credit facility for the procurement of Canadian goods, primarily products and services from Canada’s energy and engineering, to Sonatrach and its subsidiaries.

4) ECA-Backed Indonesian Pulp Mill Used Illegal Wood Sources

September 14, 2004 – (Source: Forest Rescue Alliance Riau, Indonesia) The Indonesian NGO network Forest Rescue Alliance Riau has found out from research conducted in July, 2004, that illegally-cut trees in the Tesso Nilo National Park in Riau, Sumatra, went to the PT Indah Kiat Pulp mill owned by Asian Pulp and Paper. PT Indah Kiat Pulp and Paper was designed, equipped and funded by Finnish companies and Export Credit Agencies, as well as other ECAs: the Swedish EKN, Spanish CESCE, Danish EKF and the Canadian EDC.

5) US Ex-Im Bank Backs New Oil and Gas Field Development in Mexico

September 30, 2004 – (Source: US Ex-Im Bank) 167 US companies, mostly from Texas, are set to participate in a $400M USD US ECA Ex-Im Bank-backed sale of equipment and services to Petroleos Mexicanos (PEMEX) for the New Pidiregas Projects (NPP). NPP is made up of 23 LNG and oil facilities located offshore in the Bay of Campeche off the northern coast of the Yucatan , and onshore in northern Varacruz and northwestern Tabasco . The development’s goal is to increase Mexico 's production capacity to 4M barrels of oil and 7B cubic feet of gas per day by 2006.

6) US Ex-Im Bank Backs New Oil and Gas Field Development in Peru

September 13, 2004 – (Source: US Ex-Im Bank) The US ECA Ex-Im Bank has approved a $15.9M USD credit guarantee facility to support the sale of equipment and services to Petro-Tech Peruana S.A. of Lima, Peru for oil and gas exploration and development off Peru's northern coast. Texas-based Petro-Tech will procure the goods and services from a variety of US companies to support ongoing operations as well as expansion and exploratory activities in Peru ’s coastal oil and gas fields.

7) Iraq Wants 90 – 95% Debt Forgiveness

October 4, 2004 – (ABC News: Reuters) "What we are saying is we want a cut off of 95, 90 to 95 percent. That's why there is negotiations," Iraq's Finance Minister told reporters after clinching a $500 million credit from the US Export-Import Bank. Iraq has found a starting point for debt relief in a proposal by France to relieve 50 percent of its debt. The US is also pressing for 90 - 95 percent debt forgiveness for Iraq 's $120B USD debt. The US has faced opposition from France , which points out that Iraq should not expect the same treatment as impoverished African nations, given that Iraq has the world's second largest oil reserves.

8) Dabhol Standoff Continues

September 21, 2004- (The Financial Express, India) The Dabhol Power Company, once sponsored by Enron and then GE, now languishes in a negotiation standoff between Indian companies and offshore lenders as they try to buy its $320M USD offshore debt (“dedollarizing” it) at a low rate. Investment in the ill-fated power company includes $479M USD outstanding credit given by export credit agencies, including JBIC of Japan, Ex-Im Bank of the US and OND of Belgium.

Read our September 2004 update on the Dabhol Power Company.

9) Nigerian Petroleum, Mobil Seal Deal On $1.27B USD Gas Project

September 20, 2004 – (This Day, Nigeria ) The Nigerian National Petroleum Corporation (NNPC) and Mobil Producing Nigeria signed an agreement for the financing of an LNG expansion project, expected to cost $1.275B USD. NNPC and Mobil Producing will raise the sum of $650M. All the loans to finance the project will be guaranteed by the Overseas Private Investment Corporation (OPIC), an investment insurance agency of the United States government. The project entails the expansion of the NNPC/Mobil LNG plant located in Bonny, Rivers State.

10) BP’s Millions at the Expense of the UK Taxpayer, Environment

October 6, 2004 – (Source: Friends of the Earth) Responding to analysts' forecasts that oil giant British Petroleum (BP) will record £9B profits this year, Friends of the Earth accused the oil giant of profiting at the expense of people, climate change and the UK taxpayer. BP receives large subsidies from the UK government every year to support its oil export development projects, including the controversial Baku-Ceyhan Pipeline. This pipeline project is spearheaded by BP, but 70% of the project's costs have been borrowed through both private banks and public development banks, including the World Bank's International Finance Corporation (IFC), the European Bank for Reconstruction and Development (EBRD) the Export Credit Guarantee Department (ECGD), and the US Export-Import Bank. The project has been criticized by environmental and human rights groups for breaching international human rights law and damaging the environment.

Read our July 2004 update on the Baku-Ceyhan Pipeline here.

V3N7

1) Shell's Oil Spill on Sakhalin Island

September 9, 2004 – (The Observer ) On September 8, a Shell Oil-contracted dredging vessel spilled as much as 200 metric tons of heavy fuel oil and diesel at Russia 's Sakhalin Island. Local and international conservation groups are responding with outrage, noting that Shell and the Western banks that may finance the project have been warned for years about the high risk of spills and gross inadequacy of the project’s oil spill response plans. The Sakhalin II project seeks up to $5 billion in public financing from the Export Credit Agencies of the US, UK, and Japan, and the European Bank for Reconstruction and Development.

2) Firms May be Barred from Future Business in Nigeria

September 2, 2004 – (The Guardian) Several firms including Halliburton Energy Services Company, Technic Snamprogetti, and the Japanese Gas Corporation face possible exclusion from future business in Nigeria until the government concludes its investigation of alleged corruption involving the Bonny Island Liquid Natural Gas plant. The Bonny Island project has support from the US Export-Import Bank and several European Export Credit Agencies. Investigations are also underway by the French, UK and US governments. Read a recent report of environmental and social problems at Bonny Island.

3) US Dept. of Energy, OPIC Form Partnership for Environmentally Sound Economic Development

September 8, 2004 – ( US Newswire ) The US Energy Secretary and the President of the Overseas Private Investment Corporation (OPIC) signed a partnership agreement to promote investment in clean energy in the world’s emerging markets. Under this agreement, both agencies will work to create an Efficient Energy and Renewables Program emphasizing innovative financing and creative partnerships for environmentally-sound economic growth.

4) OPIC to Search for Dabhol Power Plant Sponsor

August 19, 2004 - (The Times of India) The Indian government has decided to appoint OPIC to find a new sponsor for the Dabhol Power Company. The government says it is also taking steps to resolve friction between Indian lenders and the project's US promoters — GE and Bechtel — over who has the first right to the proceeds from the sale of the plant.

Read a 1999 GE press release about the Dabhol plant, “ Enron's flagship project in India.”

5) Bush Government Sued Over Climate Change

August 25, 2004 – (The Dominion, Canada) The Inuit people from Canada and Alaska have announced intentions to sue the US government at the Inter-American Commission on Human Rights to force the US to address the issue of climate change. The government of the island nation of Tuvalu is also planning a case against the US and/or Australia at the International Court of Justice in The Hague . The cities of Oakland, California, and Boulder, Colorado, in coalition with the Friends of the Earth and Greenpeace, have already sued two US agencies - the Export-Import Bank and OPIC - for funding fossil fuel projects.

5) WEED Authors Guide to Investment Guarantees

August 30, 2004 – (Source: WEED) The German nongovernmental organization World Economy, Ecology & Development (WEED) has produced a 22-page booklet on investment guarantees. Unlike export credit, investment guarantees merely offer protection against political risks. This book explains investment guarantees, from what is insured to the possible consequences of such guarantees.

V3N6

1) US ECA Ex-Im Bank Under Pressure to Reconsider Peru’s Destructive Camisea Gas Project

July 20, 2004 – (Source: Friends of the Earth) As the Inter-American Development Bank plans to bring the controversial Camisea Gas Project in Peru to financial closure, the US Government is set to support the project despite previous objections to financing it via US taxpayer dollars due to negative environmental and social impacts.

Click here for more on the Camisea controversy from OneWorld US (July 29).

2) Seeking ECA Support, Shell’s Sakhalin II Project Threatens Whale with Extinction

August 3, 2004 - (LA Times) ECAs from Japan, the UK, and the US that are considering financing the Russian Sakhalin II oil and gas project now face an International Whaling Commission (IWC) declaration that the project threatens the Western Gray Whale with extinction. At its annual meeting in June, 2004, the IWC said that the Western Gray Whale is in “serious danger of extinction,” and that its protection is “a matter of absolute urgency,” particularly with the onset of oil and gas projects including Sakhalin II. According to Sakhalin Environment Watch, “if only a few whales die, the point of no return will be passed.” Another article quotes the World Wildlife Fund on the IWC declaration, “This is a wake-up call for Shell to pay proper attention to the environment when planning major oil projects."

3) Dutch Government Demands Iraq’s ECA Debt for Mustard Gas Be Paid with Aid Money

July 23, 2004 - (Expatica News, Amsterdam) The Dutch government is demanding that the Overseas Development Ministry bear the costs of materials for mustard gas that the Dutch company Melchemie sold illegally to Iraq in 1985, but for which it never received payment. The Dutch government plans to forgive part of Iraq 's debt, which will be calculated as "aid" on the budget of the Overseas Development Ministry. Environmental group Both Ends said it was "sour" that forgiving Iraq 's debt would come at the cost of overseas aid.

4) US ECA Ex-Im Bank and Danish ECA Finance Gas Turbine Generator Sale to Turkey

July 16, 2004 – (Source: Export-Import Bank of the United States) In the first instance of the Export-Import Bank of the United States (Ex-Im Bank) co-financing with Denmark's Export Credit Agency (EKF), Ex-Im Bank has approved a $60M USD loan guarantee to support the export by US suppliers of three gas turbines to build a 154-megawatt combined cycle power plant in Kayseri, Turkey.

5) Up to $135M Political Risk Insurance Granted by OPIC for Major Bolivian Silver Project

August 2, 2004 – (PRNewswire) Coeur d'Alene Mines Corporation of Idaho, the world's largest primary silver producer and a growing gold producer, announced that the board of directors of the Overseas Private Investment Corporation (OPIC) approved up to $135M USD in political risk insurance for Coeur's San Bartolome silver project in Bolivia.

6) OPIC to Finance Botswana’s First Coal Bed Methane Wells

August 13, 2004 – ( Business Day, Botswana) The US Overseas Private Investment Corporation announced that it will provide an $8.5M USD investment guarantee to the Kalahari Gas Corporation to finance the purchase of equipment and drilling of coal bed methane wells. Said US ambassador to Botswana Joseph Huggins, " Botswana has no infrastructure for the extraction or end use of coal bed methane, so this project truly represents a groundbreaking initiative with regional, and local potential for growth."

7) Venezuela Asks for International Arbitrator in OPIC Ruling

July 21, 2004 – (US Newswire) Senior officials of the Venezuelan oil and gas concern PDVSA (Petroleos de Venezuela, SA) have said that the company's commercial dispute with the San Diego firm Science Applications International Corporation (SAIC) should be put before an independent international arbitrator, rather than be subject to US political pressures. In mid-July the US Overseas Private Investment Corporation decided in favor of SAIC in this matter, asserting PDVSA and the Government of Venezuela had expropriated SAIC's Venezuelan investments.

8) OPIC Considering Funding More LNG in Nigeria

August 2, 2004 – (This Day, Lagos) The Nigerian National Petroleum Corporation (NNPC), is inviting Nigerian banks and foreign credit agencies, including the US Overseas Project Investment Credit Agency (OPIC), to participate in the funding of a $1.2B USD Liquid Natural Gas (LNG) project to be located offshore Rivers State. The project, the second tier of the Oso LNG project, is a joint venture between the NNPC (49% share) and Mobil (51% share).

9) Eco-Feminist Arundhati Roy Protests India’s Destructive ECA-backed Dams

July 19, 2004 – (ZNet Online News) In this opinion piece written for Outlook India, Roy draws attention to Harsud, a 700-year-old Indian town slated to be submerged by the reservoir of the Narmada Sagar Dam, the most destructive dam on that river. She points out that over the next 13 years the NHPC, the national hydropower company managing the Narmada Sagar Dam Project by a joint-venture agreement with the regional government, plans other dam projects to produce 32,000 MW of power, or the equivalent of 32 more Narmada Sagars. Finances for these projects have come from numerous export credit agencies, including COFACE ( France ) and NEXI & JBIC ( Japan ).

10) Czech Consortium Prepared to Build ECA-backed Bulgarian Nuclear Plant

August 3, 2004 – (UPI Energy) Bulgaria 's Council of Ministers is set to announce bids for the construction of the Belene nuclear power plant. Following an April meeting of the Skoda consortium (consisting of two Czech companies), the Energy Ministry, and the national electricity company (NEC), Skoda announced they were willing to complete building the Belene nuclear power plant. Citigroup, Unicredito and the Czech Exports Bank supported the Skoda proposal.

11) New African Multilateral ECA Seeks Business

July 27, 2004 – ( The Nation , Nairobi ) The Nairobi-based African Trade Insurance Agency (ATI) is Africa 's first and only ECA, and is now aggressively promoting its export insurance. First financed by the World Bank, ATI aims to reduce the risk-perception of the region's business environment. There are now 11 member states of ATI: the seven founding states ( Kenya , Rwanda , Burundi , Malawi , Tanzania , Uganda and Zambia ) plus Eritrea , Madagascar , Djibouti , and the Democratic Republic of Congo.

12) UK ECA Threatens Engineering Group with Blacklisting for Saddam Kickbacks

August 1, 2004 – ( The Observer , UK) The UK engineering group Weir could be blacklisted by that government's export credit agency after becoming embroiled in controversy over £4.2 million in possible kickbacks paid to the Iraqi government under Saddam Hussein. A ban by the Export Credits Guarantee Department (ECGD) would hinder attempts by the company to secure lucrative contracts in potentially unstable parts of the world. A spokesperson for the ECGD said it would not be investigating the case until Weir next applied for coverage, but that any company found to have paid bribes would face an automatic ban. 'According to our rules, past involvement in corruption is a prima facie reason to refuse cover,' the spokesperson said.

13) UK ECA Seeks Oil Investments in Iran

July 23, 2004 – (Persian Journal) The British government's Export Credit Guarantee Department (ECGD) is continuing to focus on Iran 's oil, gas and petrochemical business, which it hopes will lead to the future investment of UK companies in the South Pars gas field. In its latest annual report, ECGD listed credit guarantees being approved for nine Iranian petrochemical projects worth $136M USD in the year ending March 2004.

14) Canada’s ECA Plans to Continue to Work with Company Convicted in Lesotho Corruption Case

July 30, 2004 – (Inter Press Service, South Africa ) It is business as usual between Canadian government agencies, including the Canadian ECA Export Development Corporation (EDC), and a local company barred from World Bank contracts after being convicted of bribery in Africa . Engineering firm Acres International was found guilty in Lesotho in 2002 for trying to bribe the official responsible for the Lesotho Highlands Water Project (LHWP), but Canadian agencies will continue to consider it as contractor. Testifying before a committee of the US Congress in mid-July, the lead prosecutor in the Lesotho case said, "There is a lingering impression in Lesotho, as well as in South Africa, that the interest of First World countries in the present prosecutions lies not so much in the successful outcome of these prosecutions but rather in protecting the interests of its companies that are involved.”

15) Australian ECA Weighs in on Papua New Guinea’s Prospects for Development

July 30, 2004 – (The National, Papua New Guinea ) The Australian ECA, the Export Finance Insurance Corporation, praised the industrial relations of Papua New Guinea (PNG) to foreign investment, saying that wages in PNG could hardly give investors or employers any cause for complaint. EFIC noted that land use is the most intransigent issue, and that generations might have to pass before a more “positive” approach towards land use became the norm.

16) Chinese Ex-Im Bank to Provide $116M to Uzbek Oil and Gas Sector

August 3, 2004 - (Interfax) Uzbekistan plans to raise $955M USD in Chinese credits in 2004-2007 for investment projects, t he bulk of which (over $116M USD) will go to the oil and gas sector, including $47.3M USD for investment in new developments in Arniyaz, Markovskoye, Sardob and Umid, as well as on the Ustyurt Plateau.

17) Vietnamese Oil Refinery to be Financed via Japanese ECA

August 3, 2004 - (VNA, Viet Nam ) The Japanese firm, Mitsubishi, plans to arrange a $950M USD loan for the $3B USD Nghi Son oil refinery and petro-chemical project, making it the key partner in the project. Petro Vietnam , the Vietnamese Oil and Gas Corporation, announced at the end of July that it is discussing with Mitsubishi the amount of capital the Japanese firm will provide, to be channeled through the Japan Bank for International Cooperation (JBIC). The Vietnamese ECA the Export-Import Commercial Bank (Eximbank) will be among the four domestic financial backers.

18) German ECA Hermes to Protect Investment in Libya

August 13, 2004 – ( Faz.net , Germany ) The German government, to minimize risks and promote German business in Libya , wants to enact the Hermes credit guarantee on German exports to the oil-rich North African country as soon as possible.

19) Ho Chi Minh City Gets Help from Japanese ECA for Waste Recycling Plan

August 7, 2004 - (VNA, Viet Nam) The Japanese Bank for International Cooperation (JBIC), after research on the reuse of industrial and domestic waste for pollution control in Viet Nam, suggested using waste materials for power generation, such as producing cement and fertilizers, or food for breeding earthworms. According to JBIC experts, Ho Chi Minh City can build three power plants for waste reuse, and can recover all the costs, $42M USD, in 18 years.

V3N5

1) Whistleblowers Reveal BTC Pipeline Construction Failures

June 26, 2004 – According to “The Independent,” The safety of a controversial oil pipeline being built by one of Britain 's largest companies has been jeopardized by cost-cutting, incompetence and shoddy workmanship by contractors, whistleblowers have reported. The project ran into opposition from civil rights and environmental groups when pipeline backers sought funding from public bodies such as the World Bank and the UK 's Export Credit Guarantee Department (ECGD).

Meanwhile, June 15, 2004, the UK parliament's Select Committee on Trade and Industry published a report on the "Work of the ECGD" . UK-based groups including Corner House, the Baku Ceyhan Campaign, WWF, Campaign Against Arms Trade, BASIC and FOE gave evidence. Click here for PDF version.

2) Banks Advised Not to Sell Environmentally Damaging China Bonds

July 19, 2004 - Two financial institutions in China are trying to raise $2 billion through international bond issues. The institutions have a track record of financing destructive dam projects such as the Three Gorges Dam in China and around the world. International Rivers Network and Friends of the Earth have called on private banks not to participate in these bond issues. Read the press release and a background document with project case studies (PDF).

3) NGO Discussion Paper and Final Report on Human Rights Impacts of Trade and Project Finance

May 3-4, 2004 – The Halifax Initiative's NGO Working Group on the EDC has released a discussion paper and final report on the ways human rights can be mainstreamed into trade and project finance (with a particular focus on ECAs, the IFC and MIGA. The final report provides an overview of discussions and conclusions at a May 2004 multistakeholder meeting of experts including development, environment, gender, human rights, labour groups, academics, assessment practitioners, and government, including the EDC.

4) Finnish ECAs Violate Environmental Policy

June 28, 2004 – The Finnish ECA Reform Campaign, based in Helsinki, reports that its country's ECAs violates government environmental policy, citing the development policy program adopted by the Finnish government in February 2004.

5) Belgian Government Advances Forest Protections into ECA Policy

June 16, 2004 - According to the Belgian NGO, Projecto Gato, a new Belgian federal government announced that it will not award export credits, risk insurance and investment insurance to projects in endangered forests. The policy now covers the Belgian ECA Ducroire . Source: Jan Cappelle, Proyecto Gato.

6) Ex-Im Bank's Updated Environmental Policy

July 2, 2004 - The BNA reports that the US Export-Import Bank's board of directors approved new environmental guidelines July 1 for the evaluation of large infrastructure projects, after several changes were made to proposed draft guidelines that had been criticized by environmental groups for lowering the bank's standards.

7) Endless Days, Ongoing Disaster at Shell's Bonny Island Plant

July 13, 2004 – The NRC-Handelsblad (Dutch Newspaper) reports that the Bonny Island chemical complex of NLNG (Nigeria Liquid Natural Gas), built at the initiative of Shell and co-financed by the Dutch export credit agency Gerling NCM, could have been a model project. Instead it has created a nightmare of pollution for the island.

8) Large Dam in India's North East May Get ECA Financing

June 19, 2004 - The Financial Express reports that India's National Hydroelectric Power Corporation (NHPC) is planning to raise $200-240 million USD from the international markets through export credit agencies (ECAs) for part funding for developing the 2000 MW Lower Subansiri hydropower project in the Indian state of Arunachal Pradesh. NHPC will discuss the project with ECAs in the US , in Austria , France , Germany and Japan . The Lower Subansiri region is a hotspot of biodiversity. The indigenous affected communities are opposing the project.

9) InterOil Enters Stock Market as its OPIC-backed Papua New Guinea Refinery Draws “First Oil”

July 14, 2004 – Papua New Guinea 's “The National” reports that an OPIC-backed refinery's Canadian parent company InterOil has entered the stock market, an event which “coincides with [the] ‘first oil' into the company's Napa Napa refinery," according to InterOil's chief executive. InterOil has also just received the final installment of the 85 million USD financing for the construction of its Napa Napa refinery provided by the Overseas Private Investment Corporation