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Jubilee Statements

Monitoring the impacts of government and corporate behaviour in communities overseas.

UN Independent Expert calls for greater transparency of EFIC's operations

Release Date: 11-Feb-2011

[Media Statement, Jubilee Australia 11 February 2011]

A report released in the last week by New York NGO Human Rights Watch confirms allegations of torture and rape by private security squads at the Porgera Gold mine in Papua New Guinea, the most recent in a spate of evidence implicating Australian companies, Australian banks and even Australian taxpayer funds in the serious violation of the rights of individuals and communities in our region.  

Australian loans made to support mining projects in PNG, deemed in Australia’s ‘national interest’, have been put in the spotlight this week by a visit to Australia by United Nations Independent Expert on Human Rights, Foreign Debt and International Financial Obligations, Dr Cephas Lumina. 

Among other matters, Dr Lumina’s visit to Australia considered the role of lenders such as Australia’s Export Credit Agency (EFIC) in financing projects in countries that face huge social and political challenges with high risk of human rights abuses, conflict and worsening corruption. In a press conference today to conclude his visit, Dr Lumina identified as one of his key concerns the lack of information available to the public about the transactions undertaken by the EFIC. He urged the Australian Government to “ensure accountability and transparency in EFIC’s operations, particularly those undertaken under its National Interest Account.”

One of the latest such deals was a multi-million dollar Australian government loan contract signed in favour of PNG’s largest ever mining venture, a US$15 billion Liquefied Natural Gas (LNG) project led by Exxon Mobil, with Australian companies Santos and Oil Search in toe. More than $300 million will come directly from Australian taxpayers, despite the benefits of the loan concentrating heavily in the bank accounts of the private companies involved. 

Even in the project’s early construction phases there are signs for concern, with unidentified mobile police squads patrolling the areas around the project sites and a number of incidents, including shooting deaths, reported in national media. The entire project came to boiling point in recent weeks with local landowners closing down gas plants and mobilising on project sites after increased discontent over payments owing to them as compensation. 

In the case of the Porgera mine, also in PNG, in the early 1990s the Australian government provided loans worth over $200 to facilitate Australian private sector involved in the controversial project.   

Australia’s export credit agency, EFIC is a statutory authority providing this finance on behalf of Australian citizens and government. Yet the agency hides behind an unusual exemption from the Freedom of Information Act and a lack of scrutiny applied to it by the Trade Minister.  

“Mining projects undertaken by Australian corporations in developing countries have, in many reported cases, had unacceptable consequences, including social unrest, irreversible environmental damage, and the infringement of individual and community human rights”,  said Adele Webb, National Coordinator of Jubilee Australia. 

“While it is not reasonable to expect Australia’s export credit agency to solve these issues, we do expect EFIC not to make them worse”. 

“Australian taxpayers deserve to know what is being done with their money, especially if there is evidence it is financing problem projects in the region. At the very least, the Trade Minister should seriously consider removing EFIC’s exemption from the Freedom of Information provisions, and require the agency to meet more stringent reporting requirements”.