(London) – The European Bank for Reconstruction and Development’s (EBRD) new draft Environment and Social Policy would fail to weed out abusive development projects, seven human rights and bank watchdog organizations said today in a joint statement. The bank’s consultation on the draft policy closes on March 5, 2014. It then has an opportunity to revise the policy before sending it to the bank’s board for approval in the coming months.
While drawing concrete consequences from the violence that happened in Ukraine, the European Investment Bank seems to be unmindful of the ongoing human rights abuses and killings in Egypt.
With this letter 14 organisations from the MENA region and Europe bemoan the lack of clear purpose and effectiveness of the EBRD's democratic principles that are being undermined by the bank's moves towards making Egypt a full country of operations despite having significant concerns about the state’s conformity with these principles.
Six months after the Egyptian army deposed Egypt's first freely elected president, the weak democratic signals by the authorities are overshadowed by widespread repression. How can the European Bank for Reconstruction and Development possibly help under these circumstances? Or put differently: Will the limited benefits to the country's private sector from EBRD engagement really be enough to outweigh the harm done by the bank's support for an undemocratic regime?
Prompted by gross human rights violations in Egypt this letter asks for clarification how the EBRD can continue to operate in Egypt even though the EBRD's mandate states that the bank operates in "countries committed to and applying the principles of multiparty democracy, pluralism and market economics" and its continued operations in Egypt therefore amount to a blatant violation of its commitments as a public institution.
On December 18 the EBRD board of directors approved a loan of USD 50 million to finance a project aimed at the expansion of oil operations and reducing gas flaring in Egypt. Yet the tenuous political situation in the country continues to raise concerns about the bank’s ability to make a positive contribution towards the democratic process, and whether it should be investing there at all.
At a closer look the EBRD's new energy strategy, complimented for the restrictions it places on coal lending, reveals a shocking lack of operational knowledge to implement the ambitions outlined in its executive summary.
Adding to the ongoing febrile atmosphere in the country, Egypt's military-backed authorities just yesterday passed a controversial new law that imposes draconian restrictions on public protest. Meanwhile, in recent weeks the European Bank for Reconstruction and Development has reconfirmed its intention to remain active in the country - despite a number of serious doubts still hanging over its potential impact.
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