(Sierra Club, Oakland, 23 April 2021) More than a year has passed since the deadly April 10, 2020 coal ash disaster at the US EXIM-financed Sasan coal plant in Singrauli, India. The coal ash disaster was responsible for the deaths of six people and created a massive flood of coal ash that continues to pollute the water and community land almost a year later. Back in 2015, the Inspector General of EXIM issued a report revealing a stunning 19 fatalities at the facility. This followed a 2014 report from Sierra Club and NGOs that revealed forced resettlements, occupied houses being bulldozed in the middle of the night, labor abuses including employees handling hazardous materials without protection, and rampant environmental contamination of the local community. Since the2015 report, monitoring reports have revealed an additional eight deaths at Sasan, but the actual death count is probably even higher.
Dams
Mapping the impacts of ECAs active in Africa
(Both Ends, Amsterdam, 11 November 2020) Many industrialised nations are switching to renewable energy at home. But while they commit to phasing out fossil fuel energy domestically, these commitments are abandoned outside their borders, where they continue to push dirty energy, thus contributing to climate change, human rights abuses and environmental destruction. This is happening in African countries, while they are already being hit particularly hard by the impacts of climate change. By supporting fossil fuel as well as large hydro dam-related energy projects in Africa, export credit agencies (ECAs) add to the many risks and threats. In addition, the ECA-supported investments in fossil fuels makes these countries economically dependent on energy sources that many countries in the world are committed to phase out, which poses serious economic debt risks, undermining their long-term resilience. Coming from a perspective of communities affected by ECA-supported energy projects, this report analyses the question what the best solution is for limiting global warming to 1.5C on the one hand, and facilitating universal energy access on the other hand. Furthermore, it analyses the question what the role of public financial institutions like ECAs could be in terms of promoting a green energy future in Africa.
Canada: Stop EDC investing in environmental and human rights harm
(Amnesty International, Ottawa, 14 March 2020) In 2016, Export Development Canada – a crown corporation that claims its transactions are “environmentally and socially responsible” – approved millions of dollars in loans to Empresas Públicas de Medellin, the company building the HidroItuango dam. The Hidroituango dam cuts across the Cauca River in a region of Colombia hard hit by decades of armed conflict and grave human rights violations. The financing was approved despite warnings by experts, human rights organizations and local communities. Ríos Vivos, a grassroots movement of families dependent on the Cauca River for their food and livelihoods, has courageously denounced social and environmental impacts of the dam. They’ve also reported forced evictions, increased militarization and worsening violence, including the killing of six of their leaders.
Kenya ‘inflated’ SACE loans insurance cost by Sh10 billion
(Standard Media, Nairobi, 7 March 2019) The Government of Kenya paid Sh10 billion to insure the loans taken for construction of the controversial Arror and Kimwarer dams, but industry experts argue the cost should not have exceeded Sh1 billion. Italian insurer SACE was paid Sh11.1 billion [94.2 million Euros] as premium for the loan, but a reputable firm that offers products on sovereign loans argues the much it would have charged was Sh750 million. In essence, going by arguments by local industry experts, Kenya paid 15 times over the fair rate to the Italian government-owned credit insurer for insuring the loans procured from a consortium of banks led by Intesa San Paolo. It would be a subject of interest for investigators to determine why SACE charged 17.5 per cent of the loan amount as premium, against industry rates averaging 1.5 per cent.
BBVA signs first green-certified credit with cover from Spanish ECA
(Global Trade Review, London, 30 November 2018) BBVA has granted a five-year €16.5mn loan to a hydroelectric project in Colombia with backing from Cesce, Spain’s export credit agency (ECA). The operation has been certified as “green” by consulting firm Aecom in line with the Green Loan Principles and the UN Sustainable Development Goals. According to the bank, this is the first credit with Cesce to receive this certification.
Ilisu Dam: Dutch NCP concludes first-ever OECD Guidelines case on cultural rights
(OECD Watch, Amsterdam, 20 August 2018) NCP finds company failed to do due diligence and breached the Guidelines at Turkey’s Ilisu mega-dam. On 20 August 2018, the Dutch NCP released its final statement on the case of FIVAS et al v. Bresser, the first OECD Guidelines case filed on the subject of cultural rights as human rights. The statement determines Bresser “has not fully met the expectations and satisfied the due diligence criteria of the OECD Guidelines”. In July 2017, Fivas helped Turkish communities file a complaint with the Dutch NCP against Bresser, an SME that performs foundation relocation projects. The Ilisu Dam was the first ever project to have export credit guarantees from European governments withdrawn after the guarantees had already been agreed. ECA Watch members campaigned hard to make this happen.
Turkey Halts Filling Tigris Dam After Iraq Complains of Water Shortages
(Reuters, Ankara/Baghdad, 7 June 2018) Turkey has temporarily stopped filling a huge dam on the Tigris River after complaints from neighboring Iraq, which is suffering water shortages, officials said on Thursday. Turkey’s ambassador to Baghdad and Iraq’s water minister also said that the two countries had agreed that when Ankara resumes filling the Ilisu dam in July it will still allow sufficient water to flow into Iraq. The dam, more than 20 years in the making, will generate electricity for a large area of southeast Turkey. But it has been heavily criticized over its impact on the environment and on the tens of thousands of villagers who will be displaced. Its waters will also submerge a 12,000-year-old town.
S. Korean & Chinese ECAs to support hydroelectric dams in Iran
(Financial Tribune, Tehran, 14 March 2017) Multibillion-dollar deals have been signed with East Asian companies to develop dam infrastructure in Iran, including a $1.7 billion agreement with South Korea for developing the Bakhtiari hydroelectric dam and a $341 million Sinosure credit line for an hydroelectric dam in the western Lorestan Province as well as an offer of a €290 million Sinosure credit line for Chamshir hydroelectric dam in Kohgiluyeh – Boyer Ahmad Province.
COP blog: Big dams must not be allowed to sink the Green Climate Fund
(Environmental Finance, 15 November 2016, Washington) On a promising note, the US recently led successful opposition to official partnerships between the GCF and export credit agencies. In arguing against the GCF partnering with the Export-Import Bank of Korea, US board member Leonardo Martinez-Diaz said: “We do not think it is proper to channel [GCF resources] through entities whose job is export promotion.” Touché! But the US should consistently apply that principle; it currently counts some US export credit agency financing toward its contribution to the $100 billion.
China takes the lion’s share in electrifying Africa with ECA finance
(Global Construction Review, London, 8 July 2016) Chinese companies are playing huge role in bringing electricity to sub-Saharan Africa and can take credit for 30% of new capacity in the region, according to a study published this week by the International Energy Agency (IEA). While more than 635 million people still live without electricity there, Chinese companies channeling state funds into all different types of power stations will have brought light and power to around 36 million people by 2020. The sums are vast: the IEA finds that China invested around $13bn between 2010 and 2015 in power projects, as China’s contribution dwarfs that of any other non-African country. There is also a long-term strategy behind China’s powering of Africa. The industrialisation and economic development of the region is seen by Chinese stakeholders as important for eventually bolstering Chinese exports to the region, the IEA says. China’s approach to development assistance differs from OECD countries. For example, China is not covered by the Arrangements on Officially Supported Export Credits, which guides OECD countries in export credit financing. In the 2010-15 period, loans, credits and foreign direct investment from China into the sub-Saharan power sector amounted to around $13bn, around one-fifth (20%) of all investments in the sector. Most of this financing comes from the Export-Import Bank of China.
