(Radio Netherlands, Amsterdam, 14 December, 2009) Dutch companies wanting to invest in Dubai will no longer be able to insure their investments with the Dutch government. Minister of Finance Wouter Bos no longer wants to stand as guarantor for financial losses if Dubai does not pay its bills. Dubai, which is one of the 7 United Arab Emirates, is suffering badly from the financial crisis. This has led to the Netherlands facing a bill for €350 million from Dutch businesses that insured their investments with the government before the crisis. We noted last month that some analysts fear Dubai could be the canary in the coal mine for heavily indebted countries and overly leveraged banks.

(Financial Times, London, 9 December 2009) BTA, Kazakhstan’s biggest bank, has agreed a deal with creditors who will write off $7.7bn in debt and interest owed as part of a wave of restructuring in the country’s banking system… The plan also provides for restructuring of around $1.6bn of BTA’s total $3.5bn in export credit agreements (ECAs) and other trade finance obligations. The Export Guarantee Fund of Iran has limited support of exports to Kazakhstan to $180 million and kept the country in group 4 of the risk classification (category).

(Independent Catholic News, London, 17 December 2009) A report, published yesterday by the Parliamentary Joint Committee on Human Rights: “Any of our business? Human rights and the UK private sector” (PDF see p.70), calling for a binding international agreement on business and human rights as well as action by the UK Government now. For instance, the Government should stop firms with poor records from getting export credit support and should consider amending the 2006 Companies Act so that businesses have to conduct an annual human rights impact assessment.

(Reuters, Bloomberg, Financial Times, Pacific Environment, 5 December 2009) The U.S. Ex-Im Bank has approved the largest financing transaction in its 75-year history – $3 billion to support U.S. exports for a liquefied natural gas (LNG) project in Papua New Guinea. Financing for the construction of the pipeline and liquefaction plant – to be supported by 17 banks and 5 other export credit agencies – has not been finalised but is thought to include about $8.3 billion from export-credit agencies of other governments: Italy, China, Australia and Japan. While officials from around their world worked night-and-day to come up with an international agreement to combat climate change in Copenhagen, critics say this project will clear over 1,000 hectares of primary rainforest while pumping over 3 million tons of carbon into the atmosphere every year. The 3 billion subsidy doubles the amount Export-Import spent on oil, gas, and natural gas last year and is 99 times more than the $30.4 million the bank spent on renewable energy last year.

(Pacific Environment, San Francisco, 22 December 2009) As climate negotiations in Copenhagen ended with a whimper, new U.S. legislation passed last week that requires the U.S. Overseas Private Investment Corporation (OPIC) to phase down greenhouse gas emissions from financed projects by 30 percent in 10 years and by 50 percent in 15 years. These provisions include requirements for OPIC to implement a revised climate change mitigation plan to phase down GHG emissions associated with projects and sub-projects by at least 30% in 10 years and 50% in 15 years over 2008 levels. This builds off of emissions reductions of 20% over 10 years that was achieved in an agreement settling a landmark 2002 lawsuit filed by Friends of the Earth, Greenpeace and others. See pages 250-251 of the bill.

(Tehran Times, Tehran, 21 December 2008) Trade restrictions against Iran have disappointed the Israelis, angered the German business community and made the Iranians even more defiant… Berlin has been trying for some time to shed the reputation of being a boycotter of sanctions. One step taken by the government was to dramatically reduce the Hermes export credit guarantees for business with Iran. Chancellor Merkel has had her staff calculate that the sum of new guarantees declined by 90 percent between 2004 and 2008. In 2004, Iran, the recipient of €2.3 billion ($3.1 billion) in German exports, was in second place on the Hermes list. Today the country is roughly in 25th place.

(Oxford Analytica, Toronto, 22 December 2008) The sharp decline in availability of syndicated loans and bond finances means that companies will increasingly turn to state financial institutions, such as Vneshekonombank [Russia’s ECA] (and possibly international export credit agencies) to finance major projects.

(JIBC, Tokyo, 19 December 2008) JIBC has released its list of new projects for the period from November 13 to December 19.

(Journal of Commerce, Newark, 24 December 2008) Just when supply-chain managers were hoping that the trillions of dollars being injected into the global banking system would loosen the strings choking trade finance, another danger has risen. International trade executives are becoming more concerned that some of their weaker suppliers, especially in developing countries, may not last long enough for those billions of dollars to work their way down to their level.

A. Ilisu Dam Project facing severe backlash
  A. Ilisu Dam Project facing severe backlash
(Vienna, Berlin, Berne, Dec. 23, 2008) The European Ilisu Campaign welcomed the historic announcement by the German, Austrian and Swiss Governments to pull out of the Ilisu Dam project in Turkey after 180 days and claimed a landmark campaign victory. This unprecedented withdrawal reflects the serious social, cultural and environmental damage posed by the proposed dam. It is the first time that an agreed export credit guarantee has been suspended by any European Government. However, the European Ilisu Campaign remains concerned that the final withdrawal can only take place after a 180 day period.
  B. Turkey Goes Rogue on Ilisu
(International Rivers Network, Berkeley, 22 December 2008) Even as it becomes clear that Turkey will not fulfill the social and environmental conditions under which it accepted export credits for the Ilisu Dam from Austria, Germany and Switzerland, the funders are looking for an exit strategy which allows all parties to save face. Yet the Turkish authorities do not seem to be interested in a diplomatic solution.
  C. Export insurers halt Turkey’s Ilisu dam project
(Reuters, Vienna, 23 December 2008) The export credit insurers underwriting funding for Turkey’s Ilisu dam project on the Tigris river have halted the project amid concerns it is not meeting World Bank standards, the insurers said in a joint statement on Tuesday.
  D. Turkish government tightens the screw on project opponents
(Peter Bosshard’s Blog, Berkeley, 22 December 2008) The Turkish government is tightening the screw on Ilisu project opponents. On December 4, Turkish security forces arrested Ipek Tasli, a coordinator of the Keep Hasankeyf Alive Initiative, after she took pictures of the construction site. She and her driver were accused of disseminating propaganda on behalf of a terrorist organization, but were released the following day. On December 17, Veysel Eroglu, Turkey’s Minister for Environment (and formerly responsible for Ilisu at the dam building authority DSI) assailed project opponents as “separatists” at a press conference. In this ultra-nationalist country this is code language for terrorists. Ironically, Turkey will host the fifth World Water Forum in Istanbul in March 2009 under the motto of “Bridging Divides for Water.” Civil society representatives planning to attend this event should be prepared.
  E. Activists seize Austrian ECA to protest Turkish dam project
(TopNews.in, Vienna, 10 December 2008) Opponents of the Turkish Ilisu dam seized rooms in the Oesterreichische Kontrollbank AG (OeKB) in Vienna on Wednesday, calling on the bank to pull out of the project on ecological and cultural grounds.