They urged the EBRD “to reject the loan, or at least postpone its decision”
A group of NGOs have announced their opposition to a proposed loan from the European Bank for Reconstruction and Development (EBRD) to fund oil drilling projects in Egypt.
The EBRD is expected to decide on Wednesday whether or not it will provide a $40m loan to Kuwait Energy, according to a statement published by a coalition of NGOs including the Egyptian Centre for Economic and Social Rights, the Egyptian Initiative for Personal Rights and European groups CEE Bankwatch and Platform.
This analysis looks to the proposed loan of the EBRD to Kuwait energy, scheduled for approval on 29 May.
Primary findings are that:
The EBRD failed to properly identify the beneficiary of the loan, or the country where it is incorporated (the tax haven Jersey).
The fossil fuel nature of Kuwait Energy's drilling will fail to improve development or social justice in Egypt. While the EBRD claims to prioritise renewable energy, the reality shows a commitment to further oil & gas extraction, one of the few sectors that can easily attract capital.
On Wednesday 29 May the European Bank for Reconstruction & Development (EBRD) will vote on whether to make a $40 million loan to Kuwait Energy to drill and extract oil in Egypt. Egyptian and international organisations are pushing the board of the public multilateral bank to reject the loan – or at least postpone its decision.
Istanbul – With the 2013 EBRD annual meetings underway and in spite of repeated commitments to sustainability, the bank is set to continue financing coal projects that will dangerously aggravate climate change.
A USD 3.7 billion refinery expansion project inside urban Cairo attracting international public development finance, including potentially from the EBRD, is also attracting major controversy as a result of forced evictions, pollution and concerns about the involvement of financial entities linked to the deposed Mubarak regime.
If there is one sector in which the EBRD has been causing particular controversy in recent years, it is the energy sector. From lignite in Slovenia to hydropower in Georgia and nuclear in Ukraine, the bank has financed a series of projects that have incurred opposition from various quarters. Now that the EBRD is revising its Environmental and Social Policy it's time to take a look at what needs to be learned from these projects.