MEDIA ADVISORY
*CEE Bankwatch Network * Friends of the
Earth International * Aidwatch*
LAO COPPER MINE FUNDING UNDER ATTACK
International environment groups are
raising the alarm about a funding decision to
be taken next week by the European Investment
Bank (EIB). The EIB board will meet on
January 27 to discuss a EURO 60 million loan
for the development of Sepon copper mine in
the Lao People's Democratic Republic (Lao
PDR). Originally scheduled for December, the
decision was delayed following a
letter-writing campaign by non-governmental
organisations (NGOs).
Located in the province of Savannakhet
near the Vietnam border, the Sepon copper
mine is owned by Australian company Oxiana.
The copper mine follows a gold mine project
on the same site which has been the source of
ongoing environmental and social
controversies already exposed by an
international NGO campaign.
Lao PDR has notoriously poor governance
and human rights problems. An August 2003
report by the UN Committee on Elimination of
Racial Discrimination mentions "serious and
repeated human rights violations in the Lao
People's Democratic Republic, particularly
violations of the rights to life, physical
integrity and security, and the freedoms of
expression, association and religion
[...]".
It is extremely doubtful that open and
free consultations with local communities
affected by the mine have taken place. The
recent findings of the World Bank's
Extractive Industry Review spells out that
such mining projects do not alleviate poverty
in countries with weak governance. On the
contrary, the costs to the country and its
citizens often outweigh the benefits because
of corruption and the frequent intimidation
of local communities.
Compounding matters, environmental
legislation and enforcement in Lao PDR
remains very weak. The proposed copper mine
threatens the ecosystem of nearby rivers (key
tributaries to the Mekong River), and the
likelihood of cyanide spills, illegal logging
and increased stress on the biodiversity of
the region will significantly increase.
Philippe Maystadt, EIB president, in
conversation with a Friends of the Earth
International campaigner at the Climate
Change Convention in December in Milan
(Italy) acknowledged that, "Even if we put
forward environmental and social conditions
[on projects outside Europe] there is no
guarantee that they will be met by the
project implementers."
Further evidence that the EIB is no
champion of environmental and social rights
is provided by the Framework Agreement for
financial cooperation which it signed with
the Lao PDR on 25 November 2003. The
agreement permits the EIB to support capital
investment projects that contribute to
sustainable development. Such projects, the
agreement suggests, can be found in the
mining sector despite general agreement that
mining is the least sustainable sector,
particularly in a country run by an
oppressive regime.
Magda Stoczkiewicz, leading the EIB
campaign on behalf of CEE Bankwatch and
Friends of the Earth International said, "The
EIB needs to reconsider its involvement with
the Lao PDR. The Sepon copper mine is a huge
project with detrimental environmental and
social impacts which will do next to nothing
for the population. If approved it will only
confirm the EIB?s arrogant approach to
project finance."
Contacts:
In Europe Magda Stoczkiewicz, CEE
Bankwatch/FoEI
tel: +31 20 622 13 69 or email:
magdas@foeeurope.org
In Australia Kate Walsh, AID/WATCH
tel: +61 2 9557 8944 or email:
eca@aidwatch.org.au
More information:
http://www.foei.org/cyberaction/2003/laosresult.html
http://www.bankwatch.org/issues/eib/sepon/msepon.html
http://www.aidwatch.org.au
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