Blog entry

The great gas lock-in – industry lobbying is behind the EU push for new gas infrastructure

This blog post originally appeared on the Corporate Europe Observatory website under a creative commons licence. Download their report ‘The Great Gas Lock-in’.

Industry spent more than €100m in 2016 according to the voluntary transparency register, and deployed over 1000 lobbyists plus an army of PR and lobby consultancies, who helped to organise events in the European Parliament, secure high level meetings with the Climate and Energy Commissioners, follow policy and, among other things, push the myth that gas is a ‘clean’ fuel to partner renewable energy. Industry proximity to decision-makers and their financial power has seen them capture the agenda, with their own profit motives placed before the interest of the climate and the livelihoods of communities along the supply chain.

European Commissioner for Climate and Energy Miguel Arias Cañete came from an oil and gas background and still has close ties, and alongside Vice-President for the Energy Union Maroš Šefčovič, is driving forward the gas industry agenda at the highest political level with the full collaboration of national leaders. Their plan is to create an integrated EU-wide gas market underpinned by brand new infrastructure. The new envisaged infrastructure, built under the ‘Projects of Common Interest’ (PCIs) programme, resembles a gas industry wish-list. The industry spin on gas has been swallowed.

Rather than investing in wind, wave, and solar energy and reducing energy use, the EU’s security of supply strategy sees yet more pipelines planned to increase gas from Azerbaijan and Algeria (two countries with poor human rights records), as well as multiple others criss-crossing across Europe. An LNG and storage strategy sees yet more infrastructure being built when the current LNG facilities are operating at less than 25 per cent of their total capacity. Europe is being locked into gas well past the middle of the century when we should be moving away from it. Or, if the EU is actually serious about its commitments under the Paris Agreement, the bill for the over-investment in soon-to-be-stranded assets will be borne by taxpayers and ordinary gas customers, not industry. Either way, allowing the gas industry so much influence over our energy decisions is an environmentally, socially and economically destructive folly.

By creating energy policy hand-in-hand with the gas industry, the Commission and national governments ensure the only energy solution on the table is one that chimes with industry profits, i.e. Gas.

Recommendations:

A moratorium on all new gas infrastructure projects: all gas PCI candidates should be frozen while the list is assessed against plans to stay below a 1.5ºc temperature rise, taking into account the EU’s responsibility as a rich historical polluter.
A transfer of political and financial support: the support currently enjoyed by gas should be put behind wind, solar, wave energy, and energy reduction plans, with a focus on community- and publicly-owned infrastructure and projects, given the failure of the market and the big players to transform our economy and energy system away from fossil fuels.
An end to the privileged access enjoyed by the gas industry: as with the tobacco industry, industry inclusion in the policy process is severely stunting ambition. A firewall is needed between policy-makers and the fossil fuel industry at the national, regional, and UN level, and the EU needs to stop blocking and support this process.
Full lobby transparency now: a legally-binding and fully-enforced register is essential to know the true fire-power of industry in Brussels. Transparency is essential but the culture within the European institutions means that even when transparency highlights clear cases of privileged access for industry, such as around revolving doors or expert groups, the political will to fix the problem is lacking. Policy-making in the interest of the public rather than industry will require a fundamental shift in culture in the Commission and across EU capitals.

Read the report here in EN, FR and ES

Green Climate Fund’s preference for big players weakens transparency

As discussed earlier on this blog, the Green Climate Fund is struggling with its goal to support intermediate and small institution. Small entities have difficulties in fulfilling GCF requirements and are often not even able to develop a proposal for their project.

International financial institutions (IFIs) on the other hand, seem to benefit from this ‘market entry barrier’ as they are getting the biggest share of what the fund offers. They certainly then redistribute the grant for smaller subprojects but the transparency and participation of final beneficiaries is all the more difficult this way.

In summer 2017, both the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD) signed an Accreditation Master Agreement with GCF to be able to receive and redistribute funds. During the last GCF board meeting, the EBRD proposed the biggest of the 11 approved projects to the table.

With GCF funding worth USD 106 million, the EBRD aims to develop the renewable energy sector in the fossil fuel dependent Kazakhstan by investing a total of USD 550 million in 8-11 intermediate and small subprojects in the renewables sector for the next five years. Subprojects can include construction, grid connection, commissioning and launch of renewables such as solar, wind, small hydropower and biogas.

The grit behind the glitter

Kazakhstan’s renewables potential lies mainly in hydropower. Already ten per cent of the country’s energy production comes from hydropower plants. Environmental groups have raised concerns about the potential risks of hydropower plants that can often cause serious negative environmental impacts. The EBRD states that it will not support hydropower plants bigger than a 35 MW, which is the maximum size of a small hydropower plant according Kazakh law but much larger than the 10MW upper limit defined by both the International Renewable Energy Agency and the International Energy Agency. Small, however, does not guarantee a low environmental impact.

A cautionary tale comes from the Western Balkans where the EBRD has been involved in hydropower financing via intermediate financial institutions. Between 2013 and 2015, the bank has provided at least EUR 14 million for the construction of at least 8 small and mini hydropower plants through intermediaries in Bosnia and Herzegovina, Croatia and Macedonia. However, in most cases the public has no idea which projects these are. The projects’ Environmental and Social Impacts Assessments (ESIAs) are generally not visible on the websites of commercial banks. [1]

Bankwatch research from this year shows that these banks show a lack in transparency even when they operate with public money provided by the EBRD. Only thirteen of the 38 banks that were contacted by Bankwatch replied, three banks explicitly argued that the information we requested is confidential – also in case of so-called Category A projects, the most risky type of project.)

Private banks might be used to keep information confidential to protect their clients. But EBRD loans are public money and banking secrecy rules have to be modified in order to acknowledge the fact that the public has a right to monitor these financial flows.

Sustainability doesn’t come with a name

The Green Climate Fund does make some effort in supporting “small receivers” and their projects. Five more direct access entities (DAE) were accredited recently, allowing them to send proposals to be considered by the GCF board. At its recent meeting, the board discussed the possibility to prioritise the accreditation of entities with direct access and it agreed to enhance the support for DAEs in developing concept notes and funding proposals. Direct access entities should also benefit from a simplified approval process which enables using simple templates and demands less administration for proposals of up to USD 10 million with minimal or no risk.

Yet, considering the support for intermediary institutions, the GCF is far away from becoming a fund for direct access entities as was the original idea.

Instead of passing money through financial intermediaries, at each level reducing transparency and the ability to assess how the money is being spent, the Green Climate Fund should keep the responsibility in its own ranks and know and assess the specific subprojects before approving support. This is necessary until those banks that disburse the money start applying adequate transparency and public participation standards in financing hydropower projects. It is especially necessary in projects located in critical habitats and protected areas.

Already before the last board meeting in October, the EBRD received 27 percent of all GCF finances. With the last large project the share will be even higher. Add to that other international financial institutions and what is left for direct beneficiaries is becoming less and less.

Notes

1. There has been a recent improvement regarding the transparency of the investments that are funnelled via the Western Balkans Sustainable Energy Financing Facility (WEBSEEF). The website now features a more detailed map of hydropower projects. However, WEBSEEF does not cover Albania where information about intermediated loans is still more limited.

European Commission complicit in EU nature law violations in Bulgaria’s Kresna gorge

This week, on 16 October, the two Bulgarian non-governmental coalitions “For The Nature” and “Save the Kresna Gorge” warned that the fate of the EU protected Kresna gorge depends on the Minister of Environment and Waters Neno Dimov not approving an inadequate assessment of the Struma Motorway project.

If Dimov signs the decision on the Environmental Impact Assessment and the Appropriate Assessment for Natura 2000 (EIA/AA), approved by the Supreme Environmental Expert Council on 12 October, and thus confirms the so-called semi-Eastern G10.5 variant, it will be a serious violation of Bulgarian and European nature protection legislation.

At the same time these violations, elaborated below and communicated to the EC on a number of occasions, appear to be lost on the European Commission.

On 17 October the Commission disclosed a flash briefing from a 25 September meeting between the Commissioners for Regional Policy Corina Cretu and for the Environment, Maritime Affairs and Fisheries Karmenu Vella and Bulgarian Ministers of Transport, Regional Development, Environment and Tourism. The briefing demonstrates that the Commissioners were not briefed about the complaint submitted by environmental groups in July this year. The meeting notes expose the Commissioners’ shocking lack of understanding of the legal and procedural uncertainties that surround the biggest EU funds investment in the transport sector.

Regrettably in the released briefing from the meeting, the positions expressed by Commissioners Cretu and Vella demonstrate a significant backpedaling from the EC’s position from 2012 when a DG Regio’s appraisal stated:

“Commission services have serious reservations about providing a Commission approval to finance parts of the Motorway without having any legally binding assurance that the results of the EIA and of the Habitats AA will effectively be implemented, i.e. that the tunnel will be built.”

In another document from 2012 the EC also rightfully pointed out that:

“there needs to be absolute assurance that lot 3 of the Struma Motorway will be realised by means of one or more tunnels bypassing the Kresna gorge. The tunnel option is a prerequisite for financing of lot 2 and lot 4, yet the lack of progress on the technical preparation of the construction of the tunnel(s) does not provide sufficient confidence that this option might not be abandoned at some point in the future.”

The problem is that the G10.5 alternative promoted currently by the Bulgarian government does exactly this, abandoning the tunnel option, as it involves routing one direction of the highway on the existing local road through the Kresna Gorge and the other direction on a new route to the east of the gorge. Therefore Bulgaria and Bulgarian taxpayers will suffer serious damage, if an approval of this option goes ahead in breach of nature protection obligations and above mentioned legally binding decisions to avoid the gorge at all costs.

Here are the 5 major violations:

The EIA decision of 2008 for the construction of the Struma highway is in still force which requires the highway to be built only outside the Kresna Gorge – either by a tunnel or by a full eastern alternative with both directions east of the gorge. A new EIA decision cannot contradict the earlier ruling in which an alternative along the current road has been rejected as an unacceptable option due to the European ecological network Natura 2000, as mitigation measures to reduce the impacts are considered impossible.
The Government has made a preliminary decision on the construction of the semi-Eastern G10.5 alternative and has announced it publicly on a number of occasions together with decisions on conceptual design proposals. With these actions the government has predetermined the EIA and the AA for Natura 2000 compatibility, which is a violation of European directives and their requirement for equal consideration of all alternatives.Moreover, during a roundtable organised by the Road Infrastructure Agency (RIA) and the Chamber of Builders in Bulgaria on 27 September 2016, an agreement was reached between the government and the builders of the highway for the final selection of the alternative semi-Eastern G10.5. This agreement, reached before a decision on an approved route and a without a tender, is a violation of European law – a drastic case of conflict of interest and breach of the competition rules of the European Union.
As a consequence of the above, the EIA and AA Reports are prepared by consultants with a long string of contracts with the Road Infrastructure Agency and are most likely biased towards the semi-Eastern G10.5 alternative. For example, the full Eastern alternative G20 with all the necessary mitigation measures to reduce impacts is rejected in the assessments.The reports go to the extreme of failing to evaluate, or even consider key alternatives to the project – a necessity under European law. One such alternative includes routing the motorway and a high-speed train through a series of tunnels and viaducts to the east of the gorge. It was presented to the government as early as April 2017 and completely excluded from the reports.
RIA foresees the expansion and straightening of the current road through the Kresna Gorge – this expansion is an absolutely necessary part of the semi Eastern G10.5 alternative. This was also stated by the heads of the RIA and by the Minister of Regional Development and Public Works Nikolay Nankov publicly and repeatedly. Yet, this information is nowhere to be seen in the EIA and AA reports. This is an apparent attempt to disguise unacceptable destruction and other negative impacts that will destroy the Kresna gorge’s ecosystem and its biodiversity supporting functions, rendering it unprotected.
In addition, the RIA promised publicly the construction of traffic service and commercial sites that are not part of the project. Although the location of these sites is within a Natura 2000 site, they have not been assessed in the EIA and AA reports. Among other things, these service sites infringe on the most valuable agricultural lands and vineyards of the Keracuda variety of the local people in Kresna. The RIA completely ignored the proposals to relocate these sites outside Natura 2000 and valuable farmland.

In conclusion, the Struma Motorway decision is a political project and the responsibility for it is borne by the whole Bulgarian government.

Yet also the European Commission bears responsibility due to its approval of EU Funds for the construction of the Struma Motorway in breach of its commitments to provide guardianship of European treaties and to enforce European nature protection Directives.

Time is up and the position of the Commission transpiring from the 25 September meeting shows that it is not on top of developments in Bulgaria and it is not paying attention to critical input from civil society and the local community.

Waiting for Minister Nenov’s EIA/AA approval, in order to look closely into the project’s compatibility with EU law, risks delay of the project’s implementation as the deadline for finishing the works and reporting EU funds spending is 2023. A delay, as well as the consequences of an infringement complaint on the project for bulldozing one of Europe’s richest sites, will cost Bulgaria’s taxpayers dearly and will raise uncomfortable questions about the effective spending of EU funds in the country.

It is high time for the European Commission to heed the warnings coming from Bulgarian and European groups and to look into the detailed failures of the current assessment process. Commissioner Vella in particular needs to demonstrate a lot more concern about the spending of EU funds for the Struma Motorway and to ensure that major mistakes and environmental destruction in the EU Natura 2000 network are prevented.

Nenskra HPP: the concerns of worried locals fall on deaf ears of project developers

Evidence gathered by Bankwatch during a field trip to the Upper Svaneti region of Georgia to investigate the implementation of the Nenskra hydro power project (HPP) suggests that affected people living in the Nenskra and Nakra valleys are not being fully taken care of by the project developers. Findings from the trip are laid out in a report published by Bankwatch last month.

Meetings have recently taken place in the villages impacted by Nenskra HPP, where locals had the the opportunity to approach the developers directly for information. Bankwatch spoke with one of the participants, Lile Chkhetiani, an arts teacher from the local school and a vocal opponent of the project. “We asked repeatedly, but they failed to give full answers,“ is her main impression from the meeting.

Over two consecutive days representatives from Korea Water Resources Corporation and Salini Impregilo, the Nenskra HPP developers, held open meetings in Chuberi, the village where Chkhetiani lives along with around 1000 other inhabitants. Among the many topics discussed over the two days, the villagers voiced their concerns about their safety and future well-being. Chkhetiani, however, came away from the meetings with the impression that there had been no willingness on the part of the developers to provide in-depth, reassuring answers to the villagers’ most worrying questions.

The Nenskra project developers facing locals during the recent meeting.

“There were moments when the temperature was high”

This was particularly noticeable when the topics raised became increasingly acute, with the company representatives attempting to bat away several inquiries which were not discussed in the brochures available to the meeting participants by proclaiming “Next question! Next question! Next question!”

Tensions in the room rose as Lile Chkhetiani took the microphone and expressed her concerns about the project impacts. After being told that she was asking one too many questions, others in the room rose to support her, stating that they shared similar concerns. However answers came there none, and the majority of the local people left the room in frustration. “People opposing the project, whose questions were not fully answered, marched out as a sign of protest,” recalls Chkhetiani.

The meeting with the Nenskra project developers. The room was packed.

“There will be no alarm systems!”

Since the region, on the southern slopes of the Central Caucasus mountains, is prone to landslides, mudflows and minor earthquakes that could potentially be triggered by the excavation work and vibration from the building site, these obvious safety issues were a prime area of concern for the local people at the meeting. “People are worried about the tremors and fear about their safety,” summarises Chkhetiani the locals’ worries. Nevertheless, the developers were resolute in their stance that safety is guaranteed and that there will be no need for alarm and warning systems.

The lack of such safety measures has, in the recent past, resulted in deaths following a mudflow event during the construction of the Dariali HPP in Georgia. These deaths could have been avoided, provided an alarm system had been installed. The villagers of Chuberi and Nakra do not want a repeat of such events in their home valleys.

Who’s gaining more, the community or the developer?

The massive Nenskra HPP project also includes a small portion of investment for the communities affected by the construction. Roughly USD 4 million, less than 1% of the total project costs, will be invested in infrastructure selected by a few local representatives.

However, as Chkhetiani describes, this small panel of 2-4 local people will not be established by democratic vote: “These representatives will be selected by the developers, not by the villagers.” This may result in a situation where some voices are left unheard and financing desperately needed by local schools and kindergartens might be funnelled instead towards road construction, needed for heavy traffic to reach the project site.

Lile Chkhetiani is an avid illustrator of the typical stone towers in Svaneti. This is one of her drawings.

“It is difficult to teach without electricity”

Life in Lile Chkhetiani’s home village of Chuberi has been gradually improving, but there are still worrying leftovers from the past. While blackouts, especially during the cold winter period, have been a constant menace for as long as she remembers, the difficulties in giving lessons to her 80 students are now mounting.

“We have received no guarantees or assurances that Nenskra HPP will improve our situation,” she comments, when asked whether a massive power plant in her backyard will put an end to the blackouts. She adds: “Georgia is exporting electricity while we ourselves are in darkness!”

While the mountainous Svaneti region attracts quite a few tourists, villages in remote valleys like Chuberi have been largely hidden away from adventure seekers. However, Chkhetiani recalls seeing an increasing trend of hikers in the area after the first We Are Svaneti festival took place in Chuberi earlier this year, attracting visitors from afar to experience the culture and astonishing natural beauty. Ultimately, she concludes, “It would be really sad to see this serene landscape and river changed drastically by the Nenskra HPP.”

Fossil fuel subsidies by European public banks are underwriting climate change

The United States and Syria stand alone. With the recent adoption by Nicaragua of the Paris climate agreement, only those two countries appear to ignore the global imperative of phasing out fossil fuels if the world is to avoid the worst impacts of the climate crisis.

Within the EU, the acknowledgment of the need to phase out fossil fuel subsidies as a key part of the global effort to stem climate change has materialised in multiple policy decisions including the Europe 2020 Strategy and the recent EU 2030 Energy and Climate governance framework.

Yet, in spite of these policy pledges, a report released today shows that fossil fuels projects, in Europe and around the world, are still being enabled by billions in European public money.

In particular, the public banks – namely, the European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB) – which have repeatedly voiced their commitment to tackling the climate crisis and ‘greening’ their investment portfolios continue to dole out cash for fossil fuels extraction, distribution and consumption.

The report, co-ordinated by the Overseas Development Institute and Climate Action Network (CAN) Europe with input from Bankwatch, shows that between 2014 and 2016 fossil projects across the EU and beyond received EUR 2.3 billion from EBRD and more than EUR 6 billion from the EIB.

EU financial institutions’ green talk doesn’t hold water

In the span of these three years, the report finds, EU public banks and financial instruments have spent an average of EUR 3.2 billion every year on gas and oil production, mostly within the EU.

The Paris Agreement requires signatories to make “finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development.” Over the year following the signing of this landmark accord in December 2015, the contribution of European public banks and financial instruments to fossil fuels projects has slightly dropped but at over EUR 2.4 billion in total it remained far too generous to facilitate the urgent energy transition required.

In particular, during 2014-2016, the EIB, the world’s largest public lender, provided a total of EUR 5.3 billion to one coal project, two oil projects and 27 gas projects in 12 EU countries.

At the same time, the bank invested almost a billion euros in fossil fuels projects outside the EU. One coal and five gas projects in five countries (Mongolia, Ukraine, Tunisia, Egypt and Moldova) were awarded a total of EUR 976 million in European public money.

Over the same period, 2014-2016, the EBRD channelled no less than EUR 2.3 billion to 31 coal, oil and gas projects in the Caucasus, Central Asia and the Middle East. In addition, six fossil fuels within the EU – in Estonia, Romania, Greece and Bulgaria – enjoyed a total of EUR 209 million in EBRD financing.

But there’s more to it. The European Fund for Strategic Investment (EFSI), which is managed by the EIB, was originally intended as a financial instrument to stimulate investment in sustainable infrastructure across the EU. Yet, already in its first two years of operation, 2015-2016, the Fund spent EUR 1.2 billion on eight gas distribution projects. Evidently, investment is desperately needed for defining ‘sustainable infrastructure.’

EU Budget also needs upgrade

Released just days after the European Commission’s conference on the Future of EU Finances, the new report also underscores the urgency of reforms to the EU Budget.

As the Commission moves to prepare the proposal for the next seven year EU budget cycle, the report’s findings expose the extent to which some of the very same programmes lauded as driving climate action, are at the same time bankrolling fossil fuels with billions of euros of EU Funds. These include the Connecting Europe Facility, which in 2014-2016 directed EUR 1.1 billion to gas projects, and EUR 930 million in the current programming period of the European Regional Redevelopment Fund.

In Czechia, for example, the EUR 45 million Operational Programme Environment was meant to cut air pollution from household heating but in practice funds new, supposedly cleaner coal boilers.

These figures therefore provide strong evidence that specific reforms will be needed to bring the EU Budget in line with the UN Sustainable Development Goals and the Paris Agreement.

Next: the mother of all fossil fuels subsidies

The next UN climate summit is less than two months away, and European public banks appear as eager as ever to enable even more fossil fuels infrastructure. The Southern Gas Corridor, the largest energy project the EU is currently pursuing, could soon receive unprecedented volumes of public finance.

The EBRD has already awarded more than half a billion euros in three loans to the Shah Deniz II gas drilling project in Azerbaijan which is intended to feed the massive pipeline project.

On October 18 both the EIB and the EBRD are expected to decide on new loans to the two main legs of the Southern Gas Corridor project. The EBRD is now preparing a USD 500 million investment in the Trans Anatolian Pipeline, while the EIB is considering a EUR 2 billion loan – in fact, the EU’s largest ever single investment – to the Trans Adriatic Pipeline.

Ultimately, by continuing to provide hefty support for fossil fuels projects the EIB, the EBRD and the EU’s other financial instruments are effectively fuelling the climate crisis whose fingerprints are all over disasters such as the latest string of monster hurricanes to hit the U.S. and the Caribbean or the recent massive floods across Bangladesh, India and Nepal that killed over a thousand people and affected tens of millions.

Ukrainian civil society resists efforts to be co-opted by big agro

The controversial Ukrainian agricultural company Myronivsky Hliboproduct (MHP) may be determined to further expand its operations, for which it has already bagged over half a billion euros in financing from three international financial institutions in recent years, but in the central Ukraine region of Cherkasy the company is not getting its own way.

There, in the historic town of Chyhyryn, the MHP subsidiary Peremoha Nova has since 2015 had designs on developing a major poultry production facility. It’s a project that could bring approximately one million chickens to the area, in close proximity to the village of Ratseve. As I’ve written about earlier this year, Peremoha Nova’s efforts to implement the project and its engagement with local communities has provoked a storm of controversies, including violent assaults against people opposed to the way in which the company is proposing to proceed in the region.

At issue has been the preliminary environmental assessment for the project which Peremoha Nova released for consultation in late 2016.

Its contents raised many eyebrows in Chyhyryn. For instance, the assessment failed to provide for a sanitary protection zone which is required by Ukrainian law: residential areas could thus be exposed to excessive levels of pollution from the poultry facilities under the company’s plans. Also missing is an assessment of the project’s potential impacts on potable water in Chyhyryn, not to mention a lack of information on the volumes of wastewater that will need purification and treatment. Air pollution threats too are neglected by the assessment, with a lack of clarity on how emissions from the poultry facilities will be handled.

These shortcomings and more were strongly voiced in sceptical community feedback to the plans, but the company has been oblivious to these concerns. Locals fear, that the company, instead of dealing with the community’s reservations, is signing individual land lease deals with some locals, in contradiction with the community’s majority opinion.

Hence in April and July this year, and only after 70 protestors from Chyhyryn in February descended on the mother company MHP’s headquarters in Kiev (and this too after numerous appeals to government officials as well as the Ukrainian president), representatives from Bankwatch sat down with the company to attempt to iron out differences and come to a better mutual understanding on the company’s overall performance and approach.

Previously in July the meeting with representatives from the Chyhyryn Regional State Administration made it clear that Peremoha Nova had yet to receive permission to start amending the ‘detailed territorial plan’ of the rayon (a sub-regional administrative division in Ukraine) encompassing the village of Ratseve. Procedurally, this is the first mandated step required to obtain the necessary permission documents for such a project.

The widespread concerns over the environmental assessment continued to be glossed over by the company, and following the meeting local activist Nina Martynovska, who was beaten up in February this year, summed it up:

“What we heard is pretty unambiguous. The company is sticking to its guns and continues to try to push forward its project against the will of 80 percent of the people in Ratseve. As things stand, with so many question marks hanging over the project and our valid concerns unanswered, it goes without saying that Peremoha Nova is unwelcome in our region.”

It took a few weeks, however, for MHP to put out an alternative take on the proceedings of the meeting, with its issuing of a press release entitled ‘MHP Establishes Cooperation with Public Organisations’.

Cribbing liberally from the stock ‘How to handle uppity civil society’ corporate playbook, MHP informs that:

“During the discussion, particular problems of certain communities and territories were presented and further steps to improve the relations and establish fruitful cooperation with all the representatives of the public were outlined.”

This interpretation of the proceedings is at odds with those of us from Bankwatch and our community partners – concretely, there has been no movement from the company since last December’s preliminary environmental assessment, including no response to the outstanding concerns with that assessment. Merely turning up to a meeting, and then not acting on valid concerns, does not entail ‘cooperation’.

As the company’s bogus press release claims seeped into local media, Ratseve residents protested on August 22 near the Chyhyryn Rayon Council against Peremoha Nova’s creeping efforts to obtain the necessary permission for amending Ratsevo’s territorial plan, the first step in advancing the industrial poultry house venture.

While this project is not being directly financed by the European Bank for Reconstruction and Development, the International Finance Corporation and the European Investment Bank, institutions which have supported MHP’s ascent to become Ukraine’s largest agricultural conglomerate, the cavalier approach to stakeholder engagement and public consultation being taken by one of its subsidiaries begs questions about the supposed positive impact these banks are having on the corporate culture of one of their blue-eyed boys in Ukraine.

‘Managing’ community relations via press release spin not only fails to address sensitive underlying issues – it also only worsens sentiment and further provokes bad feeling within communities like Ratsevo.

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