Written evidence from the Worldwide Wildlife
Fund
Unfortunately, capacity issues have meant that we
have been unable to prepare a complete submission for this hearing,
although we fully support the submissions of the Jubilee Debt
Campaign, Amnesty International, Campaign Against the Arms Trade
and Corner House.
Our concerns about the functioning of the ECGD have
been for some time that the environmental impact assessments were
often inadequate, or projects exempted from them; but that even
this weak barrier has now been weakened further.
Over the last five years the ECGD has been responsible
for around 2 billion of support to British Industry per annum[33]
with the last financial year seeing an increase to 2.2 billion.
It is not WWF's contention that such a facility should be abolished,
as most economically developed countires have ECAs of a similar
nature, and clearly it is a facility in demand. However it feels
that it is not unreasonable to expect that the ECGD should operate
in a way consistent with the wider government's policies while
it is making use of taxpayers money.
However the record of the ECGD is not strong in this
respect. In 2002, two years after the adoption of the business
principles, which stated:
"We will promote a responsible approach to business
and will ensure our activities take into account the Government's
international policies, including those on sustainable development,
environment, human rights, good governance and trade"
the ECGD undertook to guarantee the BTC pipeline
and the Bonny Island gas extraction plant; two projects which,
once their full potential was exploited would be directly responsible
for more carbon emissions than the UK produces in a year. Alongside
this both projects had direct or potentially grave impacts on
the local environment, with the BTC pipeline going through three
earthquake zones, and yet by several estimates being not adequately
earthquake proofed.
Historical failings of the Business Principles:
The Business Principles were never adequate for their
purpose; since the majority of its business in arms and aerospace
were exempt from the impacts assessments, assessments when
published were heavily redacted, or withheld completely;
projects were given conditional green lights before the
work was done. This was all heavily criticised by the Environmental
Audit Committee in 2008 who said:
"We do not believe that the ECGD has struck
the appropriate balance between protecting commercial confidentiality
and ensuring due transparency. ……In 2003, our predecessor
Committee recommended that "requests for confidentiality
should be tested against rigorous criteria to ensure that only
such information as might genuinely compromise clients' commercial
activities is withheld. A high degree of disclosure should become
a condition of ECGD support. We re-iterate this recommendation"
(Rec 35).
However, since the abolition of the business principles
in March 2010, these weak and partial safeguards have been weakened
further, since smaller projects now also become exempt. The ECGD
argues that accepting, instead, the OECD Common Approaches as
the safeguards is an equivalent standard:
"The stage has now been reached where the CIAP
is not stricter than the Common Approaches as regards the criteria
for assessment of the ESHR impacts" (Consultation on Revision
to Business Principles)
But at the same time levels the playing the field:
"It remains HMG's policy that the Common Approaches
should be (revised to include smaller projects); and HMG will
continue to propose to the OECD for that to occur. Until HMG has
been able to fulfil its policy objective of a revision to the
Common Approaches, it is HMG's view that it is not right to impose
a burden on UK exporters which is not imposed by the Common Approaches
upon exporters of other OECD countries." (Ibid)
It is difficult to see how both could be the case.
It is also the case that many OECD countries apply their own screening
over and above the Common Approaches; as is shown by the OECD's
own research attached. All countries able to answer "yes"
to the question must be applying higher standards than the Common
Approaches.
In our view the ECGD is a missed opportunity to truly
invest in and support a nascent renewables industry, or at least
be transparent in the carbon emissions of our existing ones. Even
the hard won commitment in 2008 to report on the carbon emissions
of the high and medium impact projects (this, again excluding
all projects which have no impact analysis, as we have seen, the
majority) since the abolition of the BPs. Correspondence from
the ECGD to WWF of the 22 September 2010 states:
it remains ECGD's current policy to report greenhouse
gas emissions in the manner described in 2008. The reporting of
such emissions is an issue being considered as part of the current
review of the OECD Common Approaches on the Environment and ECGD
will review its voluntary commitment in the light of the outcome
of the review at the OECD.
Thus making clear that they may well be dropped in
the review. Again it is our contention that other ECAs do such
reporting, but not as part of the Common Approaches. Sticking
rigidly to the Common Approaches is a race to the bottom, and
not one that sits comfortably with UK claims to an ethical foreign
policy.
January 2011
33 Average overall value of Guarantees Issued 2005-10;
£1,904.8 million (Source: ECGD Annual Report) Back
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