(Above Ground, Ottawa, 12 November 2018) Canada’s Export Development Act is under review. In our submission (pdf) to the government, Above Ground and other Canadian civil society groups call for legal reforms to bolster the accountability and transparency of Export Development Canada (EDC). EDC’s policies state that it screens and monitors the business it supports for associated social, environmental and business ethics risks. Yet over the years we have identified multiple companies that receive support from EDC despite credible or proven allegations involving environmental damage, corruption and human rights violations. In this submission we urge Parliament to adopt legislative reforms that include prohibiting EDC from supporting firms involved in wrongdoing, subjecting it to judicial oversight and expanding the Auditor General’s mandate regarding EDC. We have also made a second submission (pdf) calling for reforms to address the climate impacts of business supported by EDC. In addition, Both ENDS and other CSOs working from a number of countries made a joint submission as formal input to the EDC legislative review regarding EDC support for fossil fuels. The submission emphasized the Canadian governments’ ambition to show leadership on climate change and to prioritise climate change action and clean economic growth.
Friends of the Earth USA
Friends of the Earth warns against Trump’s Ex-Im Bank nominee
(Washington Examiner, Washington, 23 August 2018) The Senate Banking Committee on Thursday voted 25-0 in favor of Kimberly Reed to lead the U.S. Export-Import Bank, the U.S. export credit agency, which the group Friends of the Earth fears could be a move to subsidize fossil fuel projects around the world. The environmental group warns that billions of dollars in federal subsidies could be released once Trump’s nominee is seated, as 13 fossil fuel projects are still pending at the bank. “There are serious concerns that Ex-Im under Reed will return to its past practice of supporting projects that damage the global climate, harm community health, violate human rights and hasten corruption,” said Kate DeAngelis, senior international policy analyst at Friends of the Earth, after the vote.
U.S. embassy warns Americans to leave northeastern Mozambique due to imminent attacks
(AfricaNews/Reuters, Maputo, 12 June 2018) The U.S. embassy in Mozambique said Americans should consider leaving a northeastern district close to a major gas field as imminent attacks are likely after suspected Islamist militants beheaded 10 people and killed seven others since May. Anadarko Petroleum is seeking to raise a record $14-15 billion from banks and export credit agencies for its huge liquefied natural gas (LNG) project there, sources close to the matter said in May. The company declined to comment on reports it had suspended work on its massive LNG project in the war-scarred southeastern African country. Environmental NGOs and Mozambicans have raised serious concerns about multiple negative impacts of this project. French bank Societe Generale, the financial adviser on the $20 billion Mozambique LNG project, has already received interest for a combined $12 billion in cover and direct lending from export credit agencies (ECAs) in China, South Africa, Italy and Japan.
Anadarko seeks to raise $14-$15 billion for Mozambique LNG project
(Reuters, London, 18 May 2018) – Anadarko Petroleum is seeking to raise a record $14-$15 billion from banks and export credit agencies for its huge liquefied natural gas (LNG) project in Mozambique, sources close to the matter said. Fast-growing gas demand from China and Southeast Asia is reassuring export project developers sitting on huge untapped gas discoveries in Mozambique and elsewhere that the market cycle is turning after three years of low prices. The full amount would be the largest loan ever in the LNG sector. French bank Societe Generale, the financial adviser on the $20 billion Mozambique LNG project, has already received interest for a combined $12 billion in cover and direct lending from export credit agencies (ECAs) in China, South Africa, Italy and Japan. Environmental NGOs and Mozambican have raised serious concerns about multiple negative impacts of this project.
Vietnam Pulls Request for U.S. Ex-Im Help to Build a Coal-Fired Power Plant
(New York Times, Hong Kong, 13 February 2018) A Vietnamese company is no longer seeking American financial support to build a coal-fired power plant in Vietnam, bringing to an abrupt end a closely watched test of whether Washington would back international projects that could potentially contribute to climate change. On Thursday, the Export-Import Bank of the United States, a lender run by the American government, said the Vietnamese state-controlled company, PetroVietnam, had withdrawn its application for financial support. In this case, a green light would have allowed PetroVietnam to purchase millions of dollars’ worth of turbines and other equipment from General Electric, the American manufacturer. The project, which is already under construction, faced intense criticism inside and outside the United States. Environmental and other groups said the project would have had a greater environmental impact than reports submitted by PetroVietnam had suggested. The World Bank and other major institutions have increasingly avoided backing projects supported by developing countries that burn coal and other fossil fuels, which emit greenhouse gases that contribute to climate change. The UK’s version of the Ex-Im Bank had declined to offer financial support for the Long Phu 1 project for similar reasons.
US Ex-Im may back a controversial Vietnamese coal plant
(New York Times, LONG PHU, Vietnam, 26 January 2018) With help from a Kremlin-connected Russian bank, Vietnam is building a coal-fired power plant called Long Phu 1 that will produce an estimated 5.4 million tons of carbon dioxide a year, generating enough electricity to power millions of homes. But the project needs something else first: help from the United States government and the plant’s state-controlled owner has applied for assistance with the project from the Export-Import Bank of the United States. The bank has not yet decided whether it will back the project. If it did, it would show that the Trump administration’s commitment to using more coal at home also extended overseas. Critics say it would also challenge a growing global consensus that developed nations and groups like the World Bank should stop funding high-polluting energy projects in developing countries. Britain’s equivalent of the Export-Import Bank has already declined to participate in the project. In addition, it would provide American backing for a project partly funded by a Russian bank that has endured sanctions by the United States government since 2014 because of Moscow’s military intervention in Ukraine. Several advocacy groups say that PetroVietnam’s environmental due diligence underestimated the project’s likely carbon footprint. They also say the project is not clean enough to meet new guidelines from the OECD which has tried to curb lending by government-owned export credit agencies to certain types of coal projects. By approving the project, the United States would be “thumbing our nose to all the other countries that have striven so hard to reach this agreement,” said Doug Norlen, the director of economic policy at Friends of the Earth USA.
OECD, It’s Time for Export Credit Agencies to Stop Funding Fossil Fuels
(Friends of the Earth US, Washington, 14 November 2017) Precisely as the world’s attention is focused on addressing climate devastation at the 23rd United Nations Climate Conference (COP23) in Bonn, Germany, the largest public drivers of fossil fuel financing are meeting a mere 320 miles away in Paris. The irony couldn’t be starker. Representatives of the very same countries singing their own praises in Bonn are fomenting climate disaster from Paris, at a meeting of export credit agencies (ECAs) at the Organization of Cooperation and Development (OECD) Export Credit Group. Export credit agencies (ECAs) — which are bodies funded by taxpayers to support business overseas — are world leaders in public support for climate destruction. While relatively obscure but powerful institutions, ECAs provide government-backed loans, guarantees, insurance, and credits to projects overseas — including many energy projects — in the hopes of boosting their home countries’ exports and creating and maintaining jobs. According to a recent report by Friends of the Earth U.S. and Oil Change International, ECAs fund almost $40 billion worth of fossil fuel projects each year. That is a whopping 12 times more than what they spend on clean energy projects.
G20 countries need to stop using export credit agencies to finance fossil fuel projects
(FOE US, Washington, 16 October 2017) Although at least seven major countries — including Canada, France, and Germany — have made commitments to phase out coal power domestically, their export credit agencies, or ECAs, have poured money into coal plants and other fossil fuel projects in other countries. According to a new report by Friends of the Earth U.S. and Oil Change International, ECAs annually fund $32 billion worth of projects in the oil and gas sector alone. That is 11 times more than what ECAs provide to clean energy projects. The OECD Export Credit Group has implemented restrictions on financing of some coal plants but unfortunately, these restrictions are not enough to stem the destructive financing of ECAs. Key findings of the report include: From 2013 to 2015, G20 ECAs provided 12 times as much support to fossil fuels as clean energy; ECAs provided over $32 billion annually to support oil and gas projects; Japan is the worst offender, providing over $13 billion annually to fossil fuels, followed by Korea and the United States supporting almost $8 and almost $6 billion annually, respectively. An end to ECA’s support of fossil fuels would probably stop many dangerous projects from going forward. One is a coal plant in Vietnam — Long Phu 1 — that would produce at least 6.3 million tonnes of carbon dioxide each year. Another project is the development of liquefied natural gas in northern Mozambique, which has already destroyed the land of local communities and endangers unique ecosystems such as mangroves and coral reefs. The president of the World Bank recently noted that plans to build more coal-fired power plants in Asia would be a “disaster for the planet” and overwhelm the deal forged at Paris to fight climate change. The report recommends that all ECAs disclose the amount and nature of all fossil fuel-related transactions, as well as information on their decision making process, and formulate policies to phase out all support for fossil fuels. The report follows an NGO coalition’s July 2017 report showing G20 nations provide four times more public financing to fossil fuels than to renewable energy.
NGOs urge Bank of Tokyo – Mitsubishi to reject Vietnamese coal plant finance
(Friends of the Earth, Washington, 29 September 2017) NGOs have urged the Bank of Tokyo – Mitsubishi UFJ (BTMU) to reject financing for the Long Phu-1 coal plant in Vietnam. In light of its recent accreditation at the Green Climate Fund and the commitment to addressing climate change that this accreditation implies, BTMU’s support for this climate-polluting debacle would be particularly inappropriate and reflect a complete disregard for international climate goals as set out in the Paris Agreement. The US Ex-Im Bank environmental assessment of the project noted that it will produce 63 times the annual 100,000 tonnes of CO2 limit that requires alternative project analyses under Equator Bank Principles, an analysis that the Bank has failed to undertake… Long Phu-1 violates a broad set of environmental and social policies, and an independent expert analysis has demonstrated that the project sponsor’s consulting firm doctored the coal plant’s greenhouse gas emissions estimates to appear compliant with international policies.
World Coal: IEA CCC Report – Global financing for coal power goes East
(World Coal, Surrey, 19 May 2017) Development finance is essential to help the advancement and empowerment of low and middle income economies. But, past announcements by multilateral development banks restricting finance for greenfield coal plants cast doubts on future funding. This approach to coal investments spread to other development agencies and also became a foundation for the rules governing OECD export credits (pdf). A new report from the IEA Clean Coal Centre by Paul Baruya, Trends in international lending for coal-fired power plants, examines the implications of these announcements and explores the roles and policies of different financial institutions. In 2014 alone, US$152 billion of funding was received by the coal power and mining sectors from such institutions. Of this total, just US$9 billion was provided by multilateral development banks and export credit agencies. Thus these publicly financed institutions make a minor contribution to direct funding of coal projects, although they maintain a role in attracting commercial funding to higher risk projects.
