BENN UNDER PRESSURE OVER BP PIPELINE CASH

Caspian project breaks World Bank rules on 173 counts

Hilary Benn, the new International Development Secretary comes under pressure on Tuesday, when environment and human rights groups present a dossier slamming a planned $3.5 billion Caspian oil pipeline.

Just one week into the job, Benn must decide by the end of the month whether to give public funds to the BP-led Baku-Tbilisi-Ceyhan pipeline. The project is looking for 70% of its cost, or $2.5 billion, in loans - led by the World Bank and the European Bank of Reconstruction and Development.

But research by watchdog groups has found that the project breaks World Bank lending guidelines on 173 separate counts [1]. The guidelines are designed to protect local people and the environment, and to prevent damaging projects receiving the Banks' backing.

This will be a difficult decision for Benn. While his responsibility as Secretary of State for International Development is to uphold World Bank standards on development and human rights, he will be under pressure from Tony Blair to support the project. BP, sometimes dubbed "Blair Petroleum" for its closeness to the Prime Minister, has insisted that the pipeline must have "free public money" [2].

The 220-page dossier, compiled by fifteen groups in ten countries [3], finds that just on the issue of consulting local people, the project breaks six World Bank policies, on 83 counts. Pipeline companies only met with 2% of the people living along the route. The World Bank has recently been criticised by its own Ombudsman for persistent failures in consultation on the projects it has funded [4].

Hannah Griffiths, of Friends of the Earth, commented:

"Hilary Benn must stand up for development and environment, and not give in to pressure from New Labour's corporate friends. Public money should not be given to dirty fossil fuel projects, which contribute to the problem of dangerous climate change."

The dossier also finds that the pipeline stands to worsen the human rights situation of the Kurdish people in Turkey. Over 30 Kurdish people have submitted legal complaints to the European Commission, claiming that they have been denied their rights. Last month, the European Commission agreed to investigate the pipeline [5].

The feared state Gendarmerie will have responsibility for policing the line - despite having been harshly criticised by the Council of Europe on its rights record. But BP denies the pipeline will have any adverse impact on the Kurds [6].

Kerim Yildiz, Director of the Kurdish Human Rights Project, added:

"Unless this pipeline can be shown to meet international standards on human rights, it must not be given public money. The word we are hearing from the Kurdish regions is that this project will be used as another reason to marginalise and exploit people."

Nicholas Hildyard, of the Corner House, said:

"If Hilary Benn says yes to this, he will undermine the credibility of the banks' own policies, and undermine the very possibility that they can contribute positively to development. At the very least, he must call for a delay in the project, until its many deficiencies are rectified".

Notes for editors

1: The dossier is available online at http://ifiwatchnet.org/doc/btceiareview.pdf

2: BP Chief Executive Officer John Browne, quoted in Financial Times, 4 November 1998, 'Wisdom of Baku pipeline queried', p.4

3: The groups are: Amis de la Terre (France), Baku Ceyhan Campaign (UK), Campagna per la Riforma della Banca Mondiale (Italy), CEE Bankwatch Network (Central & Eastern Europe), The Corner House (UK), Environmental Defense Fund (USA), Friends of the Earth (England, Wales & Northern Ireland), Friends of the Earth Japan, Green Alternative (Georgia), Halifax Initiative (Canada), Kurdish Human Rights Project (UK), Milieudefensie (Netherlands), PLATFORM (UK), Urgewald (Germany), WEED (Germany)

4: A recent critical review of International Finance Corporation (the part of the World Bank which would make the loan) policy by the Compliance Advisor Ombudsman stated: "Too often public consultation occurred too late to affect project design, did not facilitate local stakeholders' understanding of the project and ability to express their concerns, allowed insufficient time for stakeholders to process the information and provide thorough feedback, and was not sustained after project approval."

5: Letter to Kurdish Human Rights Project et al, from Martin Harvey, EC Enlargement Directorate, Turkey Team. See press release, 'European Commission to investigate controversial BP pipeline', at www.baku.org.uk

6: The entire extent to which the Kurdish conflict and human rights situation is dealt with in the project Environmental and Social Impact Assessment is to note that:

"There is no difference in the potential impacts of land acquisition between Kurdish speaking and non-Kurdish speaking Turkish households… What is important however is that both groups lose a similar percentage of their affected plot to both the 28-metre and the 8-metre corridor,"

and hence conclude that,

"Language/ethnic groups are unlikely to be disadvantaged since there is no difference in the potential impacts of expropriation and construction activities between Kurdish-speaking and non-Kurdish speaking Turkish households."