APPENDIX 19
Memorandum from BP Amoco plc
These are the comments of BP Amoco plc in response
to the public consultation announced by the Secretary of State
for Trade and Industry on the review of the mission and status
of the Export Credits Guarantee Department (ECGD).
On 7 July 1999, BP Amoco's Chief Executive,
Sir John Browne, wrote in a letter to the Prime Minister regarding
Angola:
"The opportunities for UK business as a
whole (. . . in Angola. . . ) are already significant,
though the fulfilment of the potential does not depend on a decision
by the Government to grant ECGD support for UK companies. As you
may be aware, French and American governments already provide
extensive support for their companies.
"This does not directly affect BP Amoco,
but we would welcome the chance to work with UK companies in Angola.
We are taking up the ECGD issue with the Treasury and would welcome
your support for a step which we believe would avoid UK companies
being left at a serious competitive disadvantage."
The above captures neatly our position. The
nature of BP Amoco's business is normally that of an investor
rather than that of an exporter or contractor. Thus our direct
involvement with ECGD has been limited and this therefore curtails
our ability to comment in depth on the ECGD. But this does not
lessen the importance of the ECGD to sectors in which we operate
such as the oil and gas exploration and production, refining and
chemicals industries.
As a UK company which operates internationally,
procuring goods and services globally, we do a great deal of business
with UK oil services companies. We are conscious of complaints
by UK suppliers and contractors that they find it difficult to
get export credit cover, unlike their competitors in other countries
which all benefit from their own national export credit agencies.
Unlike BP Amoco, which has an extensive international investment
portfolio and widely diversified business risks, such companies
often require government guarantees to be competitive.
We welcome the opportunity of working with UK
oil services companies, and would welcome changes to the services
provided by the ECGD which might increase the chances of our being
able to do so in overseas markets. We are conscious that a negative
impact on the ability of the UK oil services sector to export
on a level playing-field with competitors from other countries
may ultimately affect its ability to serve the UK offshore oil
industry. This may particularly be the case in new environments
such as those that need deep-water technology.
We recognise that these will not be the only
considerations you will take into account in your review of the
ECGD, but believe that they are important and ought to be taken
into account.
More broadly, in the context of the Government's
sustainable development policy, and its trade and environment
principles, our own activities are conducted in accordance with
our business policies, set out in our "What we stand for"
policies brochure (see enclosed). These policies set the boundaries
within which we work with respect to ethical conduct; employees;
relationships; health, safety and environmental performance; and,
control and finance. Our own projects, we believe, make fundamental
contributions to development. We increasingly use tools such as
Social Impact Assessments (SIAs) ahead of major investments.
We expect the same from third parties directly
acting on BP Amoco's behalf and we seek partners, contractors
and suppliers, including any which might benefit from the ECGD,
whose policies are consistent with our own. We will make our contractors
and suppliers aware of our own commitments and expectations, and
their responsibilities in implementing them.
We hope that these comments prove useful. Please
do contact me if you require any further information.
BP Amoco plc
October 1999
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