ECGD's Mission Statement
23. The above discussion on the Ilisu Dam should
be supplemented by one wider comment about ECGD and its relation
to development. In our previous Report on ECGD we recommended
that ECGD's Mission Statement include the Government's developmental
objectives.[33]
In evidence ECGD told that Committee that an independent report
commissioned from National Economic Research Associates concluded
that "ECGD's remit should not be expanded to incorporate
additional aid or industrial policy objectives, as doing so would
be likely to undermine operational effectiveness".[34]
The Minister emphasised that the Government had not as yet come
to a view on the issue. Vivian Brown emphasised in oral evidence
the difference between ECGD and a development organisation. ECGD
is structured so as "to react to UK exporters who see opportunities
either as prime contractors or sub-contractors to do business
predominantly in non-OECD markets, we have to wait for the project
to be initiated, we are not like an aid organisation or a developing
bank initiating the projects ourselves".[35]
24. We accept that ECGD is not a development organisation
but is there to encourage UK industry and exports. The inclusion
of the Government's development objectives in the Mission Statement
is not an attempt to change the fundamental nature of ECGD but
to ensure that all government activity is consistent with the
principles laid down in the Development White Paper. The point
made by the independent report sounds too much like the discredited
view that good development is bad business. There is no suggestion
that ECGD should not continue to consider the economic robustness
of the companies, projects and countries involved in any proposed
support.
25. In fact there are two ways in which ECGD can
embrace the development objective to eliminate poverty whilst
maintaining economic prudence and robustness. First, it can ensure
that no project supported harms the development of a poor country
or further impoverishes already poor people, that it is consistent
with the developmental interests of the country. Secondly, ECGD
can take its place in the Government's wider strategy of encouraging
investment and trade with the developing world. The overall performance
of ECGD would be judged not only against those benefits accruing
to British business but also those accruing to low income and
least developed countries. We reiterate our recommendation
that development objectives be included in the ECGD's Mission
Statement.
Conclusion
26. The Government has said that it is waiting
for the revised Environmental Assessment Report and the Resettlement
Action Plan before deciding whether its conditions have been met
and cover can be granted for the proposed Ilisu Dam. We do not,
however, believe that fundamental conditions met at the last minute,
and only as a result of export credit agency pressure, can be
treated seriously. Cover for the Ilisu Dam should not be granted.
We join the Trade and Industry Committee in urging the Government
to provide time for a debate in advance, rather than in the wake,
of a Ministerial decision on export credit.[36]
27. The debate over the Ilisu Dam has, however,
provided a welcome opportunity to consider how issues of development,
human rights, conflict, corruption and conditionality are handled
by ECGD. In all these areas we conclude that improvements must
be made. We look forward to the Review of ECGD's Mission and Status
implementing our recommendations.
33 Ibid para.8 Back
34
ECGD Rev 1 para.13 Back
35
Q.74 Back
36
Sixth Report from the Trade and Industry Committee, Session 1999-2000,
Application for Support from ECGD for UK Participation in the
Ilisu Dam Project, HC 200, para.5 Back
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