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FinalCall.com News
Business & Money
Bank accused of financing destruction
By David Cronin
Updated Dec 27, 2008 - 4:59:00 PM
BRUSSELS, Belgium (IPS/GIN) - The European Union is financing ecologically and socially destructive projects in Africa, a conference here was told in early December.
Officially, the Luxembourg-based European Investment Bank is committed to using the $67 billion it releases each year to pursue policies that protect the environment and alleviate hardship.
But evidence gathered from projects this low-profile EU body has financed in Africa indicates that its loans are having the opposite effect.
One of the largest projects it has financed relates to the construction of a 665-mile-long oil pipeline in Chad and Cameroon. This project, to which the EIB allocated $185 million in 2001, has required the large-scale confiscation of lands farmed by peasants.
Human rights activists in the surrounding region have alleged that communities affected have not received adequate compensation, that discharges of oil from the project have polluted several rivers and streams, and that gas flaring undertaken by ExxonMobil, one of the participating companies, has caused severe respiratory and other health problems.
Thérèse Mekombe, president of the Association of Women Lawyers of Chad, claimed that revenue from the project is being used by her country’s president, Idriss Deby, to increase military expenditure. Mr. Deby has been accused of supporting the Justice and Equality Movement, one of the groups involved in the violence in Darfur, across Chad’s border with Sudan, which has uprooted more than 2.5 million people over the past five years.
“On Aug. 11—Independence Day—the government was so happy to show off its war vehicles,” said Ms. Mekombe, speaking at a conference on the EIB’s activities held in the Belgian Senate. “This is not what the population expected from the exploitation of oil. They wanted the revenue to be invested in development projects and to help the Chadian population get out of extreme poverty.”
A separate project financed by the EIB involves a gas pipeline in West Africa. Stretching more than 423 miles, it starts in the Niger Delta and ends in Ghana, where it is expected to begin delivering energy in the coming weeks. In December 2006, the bank awarded $96 million to the Accra government for work on this pipeline, which brings together such companies as Shell, Chevron, Texaco and Nigerian National Petroleum.
Twelve communities in Nigeria, alleging that the project will cause irreparable harm to the environment on which they depend, filed a complaint to the World Bank, which has also been financing it, in 2006. Earlier this year, the World Bank Inspection Panel found that the communities had not been properly consulted about the consequences of the project.
Green campaigners contend that financing schemes that are reliant on fossil fuels run counter to the EU’s stated objective of fighting climate change.
Osayande Omokaro from Friends of the Earth Nigeria said European energy firms are eager to increase their investment in Africa in order to compete with China and to reduce their dependence on oil and gas from the Middle East and Russia.
“Europeans pride themselves as promoters of human rights, freedom and good governance,” he added. “The Chinese do not really promote these values. The Europeans must live by what they practice at home, even if it means losing some ground to the Chinese. It is better to make sure you practice what you preach.”
