Campaigns update: Debt and ‘dodgy deals’
QPSW partner the Jubilee Debt Campaign is directing its attention to the Export Credit Guarantee Department (ECGD), a government department supporting British business operating abroad. Some ECGD activities have been linked to corruption, environmental destruction and human rights abuse. Furthermore, when things go wrong, ECGD activities can undermine poverty reduction efforts by adding to developing country debt.
The ECGD provides UK firms operating in high-risk areas abroad with insurance or guarantees to protect against non-payment or other losses. Many countries have similar agencies which step in where conventional lenders and insurers are unwilling. Their actions are often pivotal in making deals happen and therefore have a potentially useful role to play in facilitating trade. Last year for example, ECGD activities enabled among other things, 166 civil-aircraft deliveries, the televising of English Premier League football matches across the Middle East and the provision of portable road systems to the Turkish Ministry of Defence.
If ECGD backed deals fail, the UK company concerned can recover its costs from the ECGD which, in turn, may try to recoup the money from the government of the recipient country. At the end of March 2010, low and middle income countries owed in excess of £2,000 million to ECGD. These included the Democratic Republic of Congo (£90.36 million), Indonesia (£513.46 million) and Sudan (£653.44 million), debts which JDC says may be unjust and that some governments have to finance over and above desperately needed health, education and social development spending.
In its Coalition Agreement signed earlier this year, the UK government stated that the ECGD should change so that it does not support “investment in dirty fossil fuel energy production”. Whilst a start, JDC believes that reform needs to go much deeper – including a review of outstanding ECGD debts, cancellation of those found to be unjust and much stronger social and environmental standards to ensure that ECGD projects have a positive social and environmental impact.
What you can do:
Send a post card or e-mail to Business Secretary, Vince Cable asking for reform of the ECGD. Encourage F/friends, relatives and colleagues to do so too. Two cards have been included with hard copies of this newsletter. You can e-mail through http://www.jubileedebtcampaign.org.uk Additional cards available from Suzanne Ismail suzannei@quaker.org.uk
If you live in the constituencies of Birmingham Erdington, Bradford East, Castle Point, Leeds West, Liverpool Wavertree, Loughborough, Newcastle upon Tyne Central, Northampton South, Stratford upon Avon, Stourbridge or West Bromwich, JDC needs your help! MPs from these constituencies sit on the new government select committee on business, innovation and skills which will shortly be examining the role of the ECGD.
Contact:info@jubileedebtcampaign.org.uk
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