Bankwatch

Home > Archives for Press release

Press release

Georgians demand action to save their homes from oil pipeline. Official complaint to IFC reveals shocking BTC negligence

Residents of Rustavi, Georgia’s third city, have today submitted an official complaint to the International Finance Corporation (IFC) concerning the potentially disastrous construction of the Baku-Tbilisi-Ceyhan (BTC) oil pipeline only 250 metres from a settlement of high-rise buildings. [1] The residents are taking this step following a prolonged period of uncertainty for them and their homes, a lack of information and response from officials in Georgia and violent intimidation from the regional police force.

In November 2003, the IFC, the World Bank’s private lending arm, agreed to provide a USD 250 million loan to the controversial BP-led BTC project. The residents’ complaint alleges that World Bank Group policies and procedures have not been complied with on four counts. [2]

In January this year, people in Rustavi learned for the first time exactly how close the pipeline would come to their homes when heavy construction equipment and pipeline workers arrived without warning. There was no mention of such proximity (180-250 metres) in the available project documentation and maps. The BTC Company (BTC Co) indicates in its project literature that there should be a 500 metre ‘security zone’ around the pipeline. It turns out that the pipeline will run along the nearby Mtkvari river bank, a high level erosion zone, with potentially destructive impacts on the most affected homes and the 700 families living there.

Since learning of their plight, the Rustavi residents have sent letters to and attempted to engage in dialogue with all the relevant parties – the mayor of Rustavi, local representatives from BTC Co. and the IFC – and have also taken their case to the Georgian parliament. Their appeals have been either ignored or dismissed on the grounds that the pipeline will comply with the highest western standards.

Merabi Vacheishvili, one of the residents named in the complaint, said, “We are told to shut up, stop wasting the company’s time and trust the high standards of the project promoters. Yet local people have been kept completely in the dark about this pipeline. How can we start trusting now?”

Frustrated by officialdom, last month 400 residents took part in a demonstration that interrupted the pipeline construction for one hour. The demonstration, consisting mainly of women and children, was violently broken up by the police. A police representative declared that the orders had come directly from the government.

Eleonora Digmelashvili, another resident, commented, “We have applied to the IFC Ombudsman as a last resort. There needs to be an independent expert analysis of BTC impacts on our homes as well as strong guarantees for our and our children’s security. If there are no such guarantees then the pipeline route must be changed or we should be resettled.”

Contacts:

Merabi Vacheishvili
Tel: + 995 24 17 34 58
E-mail: rustavihome at yahoo.com

Eleonora Digmelashvili
Tel: + 995 93 91 77 05
E-mail: rustavihome at yahoo.com

Notes for editors:

1) The official complaint to the IFC’s Compliance Advisor/Ombudsman (pdf) is available at the Bankwatch website.

2) The four World Bank Group policies and procedures cited in the official complaint are:

  • Procedures for public disclosure
  • IFC Operational Policy 4.01 on environmental assessment
  • World Bank Operational Policy 4.30 on involuntary resettlement
  • Procedures for preparation of Resettlement Action Plan

Background information on the BTC project is available at the Bankwatch website.

Religious leaders urge World Bank president to support Extractive Industries Review

Over 100 Jewish and Christian leaders sent a letter to World Bank President James Wolfensohn today urging him to support full implementation of recommendations in the recently released report Striking a Better Balance: The Extractive Industries Review.

“We hold the World Bank Group as a global financial institution accountable for serving the common good, alleviating poverty and preserving the natural environment. This report identifies essential steps in that direction that must be taken by the World Bank,” said Marie Dennis, director of the Maryknoll Office for Global Concerns.

Signers of the letter, including Alan Whaites (World Vision), Rabbi Jaqueline Tabick (World Congress of Faiths) and Jim Winkler (United Methodist Church), emphasized to President Wolfensohn that just economic policies and programs must 1) respect and enhance human dignity, gender equity and the integrity of creation; 2) be flexibly designed and implemented with the consent of the people expressed through authentically participatory and democratic processes; and 3) be held accountable to international human rights standards and treaties.

Striking a Better Balance: The Extractive Industries Review is a bold statement coming at a time in the life of the global community when a dramatic shift in business as usual is urgently needed, and social, economic, and environmental priorities must be re-visioned.

Dr. Emil Salim, leader of the review process, has said, “Since the WBG is committed to alleviating poverty through sustainable development, it has a moral obligation to change its priorities, working arrangements, and internal incentive systems and to use all the power it possesses, including convening power, to meet the challenge of leadership to reach for a new global balance.”

The Review’s final recommendations are derived from extensive field study and skilled research and reflect the sound judgment of a partnership of stakeholders, including most especially the voice of the poor. The Review team was willing to listen to and hear the many witnesses of grave human and ecological consequences of misguided World Bank Group projects, programs, and activities. These consequences are also understood by religious congregations and missioners around the world, whose leaders wrote todays letter to Wolfensohn.

“In today’s letter”, the leaders write, “We urge President James Wolfensohn and the World Bank management to adopt the recommendations of the Review, to embrace the challenge of radically impacting the Earth’s carrying capacity for the peoples of today and tomorrow.”

Download the letter here (pdf).

BTC pipeline court case in Tbilisi, Georgia on January 20

The democratic values of Mikhail Saakashvili’s Georgia will come under scrutiny next week when Georgian environment group Green Alternative brings legal proceedings against the Georgian government and the Baku-Tbilisi-Ceyhan Pipeline Company (BTC Co).

The court action will focus on the controversial environmental clearance granted by the Georgian government on November 30, 2002 for the construction of the BTC pipeline’s Georgian section.

“We do not know why there has been such a lengthy delay in this case coming to trial,” commented Manana Kochladze of Green Alternative. “However, we fully appreciate that the previous government responsible for issuing the environmental permit was uncomfortable with a truly independent court revision process. We are hopeful that those days are over now in Georgia.”

Following heavy pressure from the BP led BTC Co on the former president, Edward Shevardnadze, and his Minister of the Environment, the routing of the pipeline through the highly sensitive support zone of the Borjomi-Kharagauli National Park and the Tsalka region was approved in violation of Georgian environmental law. [1]

Green Alternative will point out that the routing decision also violated the statutory rights of Georgian citizens, which provide for proper access to information and meaningful participation in the decision-making process (as per article 37 of the Georgian constitution), the Aarhuus Convention and the actual Host Government Agreement signed by the Georgian government and BTC Co.

Towards the end of last year the International Finance Corporation (IFC) and the European Bank for Reconstruction and Development (EBRD) separately agreed to finance the BTC pipeline, moves which have both provided USD 500 million of the USD 3.6 billion total and, more significantly, a priceless seal of western approval for the project.

Yet verifiable breaches of World Bank standards as well as international and domestic law continue to dog the pipeline. With the IFC, the EBRD and other project creditors due to sign the project credit agreement in Baku on February 3, this Georgian legal challenge to the pipeline is one of three which are currently in process. [2]

Court details:

The case will be heard in the Appeal (Regional) Court in Tbilisi by the administrative and tax issues jury on Tuesday, January 20, 2004. The hearing starts at 2pm.

Members of Tbilisi based Green Alternative can be contacted in advance:
Manana Kochladze: +995 99916647
Nino Gujaraidze: +99599902520
Ketevan Kvinkadze: +995 900654
Email: greenalt at wanex.net

Notes for editors:

1. The drinking water reserves in the Tsalka region are an alternative water source for Tbilisi. The Borjomi region of Georgia is home to the mineral water and tourism industries, the few promising sectors of the Georgian economy. Exports of Borjomi mineral water make up 10 percent of total Georgian exports.

Leaked documents from the international food conglomerate Group Danone to the Georgian Glass and Mineral Water
Company and from The Monitor Group, a leading international strategic consulting firm, illustrate that the currently approved routing of the BTC pipeline through Borjomi is already jeopardising one of Georgia’s
key economic interests.

2. The two other current legal challenges are:

i) an Application which has been lodged by human rights NGOs, together with a landowner directly and adversely affected by the project, with the Court of First Instance (CFI) of the European Court of Justice, regarding the Host Government Agreement for the BTC pipeline.

ii) the Kurdish Human Rights Project has applied to the European Court of Human Rights for leave to bring cases on behalf of 36 named individuals whose land was expropriated for the construction of the pipeline. The applicants, who are all Turkish citizens of Kurdish descent living along the pipeline route, allege the project violates Articles 6, 8, 13 and 14 of the European Convention on Human Rights, and Article 1 of Protocol No. 1 to the Convention.

Read the CEE Bankwatch Network Comprehensive BTC background information.