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Information in: Español - Français - Deutsch - Português - Russian - Japanese - Svenska - Italiano - Suomi
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Export Credit Agencies See Business Soar Lending by export credit agencies soared by 400 per cent between 1988 and 1996 as governments around the world provided loans, guarantees and insurance to help their companies compete for business abroad, according to the draft of a new report compiled by several non-governmental organizations. While lending from multilateral finance institutions, such as the World Bank, has remained relatively stable, export credit agencies (ECAs) increased their new commitments from about $26bn in 1988 to $105bn eight years later, according to the report. At the same time the ECAs' share of developing country debt has been mounting. In 1996 they held almost one-fourth of the debt and 56 per cent of developing country official debt. The report will be released next month in Washington at a meeting of 45 NGO representatives from around the world. Having succeeded in getting environmental standards adopted at most development banks, environmentalists and human rights groups are now turning their attention to the ECAs, which they say are funding projects the development banks have rejected. The NGOs contend that many environmentally hazardous projects in mining, forestry and energy would not go forward without the backing provided by export credit agencies. Many, they say, are funding precarious projects which add to the oversupply of the world's commodities. Bruce Rich of the Environment Defense Fund said ECAs were backing many "bottom of the barrel" projects, which ought to be rejected. The report takes aim at several ECA projects, such as the proposed Aginskoe gold mine in the Russian far east, which could endanger the brown bear, mountain goats and other wildlife. Russia, hungry for hard currency, has been a target for exploitation and environmental degradation by foreign natural resource companies backed by their ECAs. The US Overseas Private Investment Corporation provided cover for two logging joint ventures, which involved the elimination of irreplaceable forests, according to the report. In 1992, the US Export-Import Bank was required by Congress to adopt strong environmental standards and has since tried to convince its fellow ECAs to follow suit. However, it has come under pressure from senators and congressman on Capitol Hill to ease its standards so that US companies are not left out in bidding for contracts. However, Eximbank officials say they have just begun to make progress in their drive for harmonised ECA environmental standards. They attribute the progress to the change of governments in Germany and the appointment of the Joschka Fischer of the Green party as foreign minister. Eximbank was asked by European agencies to join an export credit group to back funding for the $1.52bn Ilisu Dam, a controversial hydroelectric project currently planned in Turkey on the Tigris River. For the first time, the finance agencies are negotiating over common conditions to be set for their backing. The dam raises many concerns. It would require the resettlement of at least 15,000 Kurds, who strongly oppose the project, and the flooding of Hasankeyf, an ancient archaeological site cherished by the Kurds. It would give Turkey the ability to block the flow of water to Iraq for several months during the year. Eximbank officials say its board has approved conditions to be attached to US participation.
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