Nr. dodgy deals
China’s biggest bank to support Africa’s most destructive dam
Ethiopia, May 13 2010
Ethiopia's Gibe 3 Dam is one of the most destructive hydropower projects being built today. If completed, it would destroy fragile ecosystems on which 500,000 poor indigenous people depend for their survival. A worldwide civil society campaign has held international financial institutions at bay for several years. Yesterday, however, the Industrial and Commercial Bank of China (ICBC) offered to step in with a $500 million loan. If the loan is confirmed, China's biggest bank will become responsible for a massive social and environmental disaster.
The Gibe 3 Dam on the Omo River threatens the livelihoods of 500,000 indigenous people in Southern Ethiopia and Northern Kenya. By ending the river's natural flood cycle, it would destroy harvests and grazing lands along the river banks and fisheries in Lake Turkana, the world's largest desert lake. The dam will devastate the unique culture and ecosystems of the Lower Omo Valley and Lake Turkana, both recognized as UNESCO World Heritage Sites.
According to news articles in the Ethiopian press, ICBC has agreed to extend the loan for a contract under which Dongfang Electric Machinery Corp., a Chinese state-owned company, will provide equipment for the Gibe 3 project.
Ikal Angelei, the chair of Friends of Lake Turkana in Kenya, says: "The Gibe 3 Project will destroy the lifeline of the Lower Omo Valley and the Lake Turkana region. It will condemn half a million of the region's most vulnerable people to hunger and conflict. We ask Chinese banks and companies to stay away from this disaster."
Peter Bosshard, the policy director of International Rivers, comments: "The World Bank, the African Development Bank and the European Investment Bank have so far kept their distance from a project that violates many of their safeguard policies. If ICBC indeed picks up the slack, it will severely damage China's efforts to be a responsible actor in the protection of the global environmental."
Johan Frijns, the coordinator of the global BankTrack network, says: "China has made impressive progress in reforming its banking sector through its green credit policy. Funding an environmental disaster like the Gibe 3 Dam would make a mockery of the environmental reform efforts in China's banking sector."
International Rivers Website
Ikal Angelei, Chair, Friends of Lake Turkana
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