Public Money for Tropical Forest Destruction

Background
Solutions

In June 1999, OPIC approved a loan to Enron Corporation and Shell for a 630 km gas pipeline in Bolivia and Brazil. The project will not only destroy the world's largest remaining tract of primary tropical dry forest and harm the Pantanal - the world's largest wetland - but directly violates the Overseas Private Investment Corporation's (OPIC) own environmental policies.

Background

This June, OPIC approved a loan to Enron Corporation and Shell for a 630 km gas pipeline in Bolivia and Brazil. The project will not only destroy the world's largest remaining tract of primary tropical dry forest and harm the Pantanal - the world's largest wetland -but directly violates OPIC's own environmental policies.

Separate field visits and reports by Indigenous Organizations, Amazon Watch and World Wildlife Fund all reveal contractual violations and chronic environmental problems. Key violations include:

1) Unfettered access to the right of way.

2) Creation of unplanned access roads.

3) Failure to Implement the Indigenous Peoples Development Plan

4) Negative Impacts to the Pantanal

5) Major and Irreversible Erosion Problems

6) Degradation of Roads and Bridges

7) Lack of Independent Project Monitoring

8) Chronic Environmental Degradation

9) Destruction of Primary Tropical Forest

10) Associated impacts by enabling access to Bolivian gas and other new pipelines.

To date, OPIC has disputed and summarily dismissed all NGO findings in a more defensive manner than even the companies involved on the ground- Shell and Enron. OPIC has presented one-sided power point presentations to the public.

World Wildlife Fund, Missouri Botanical Garden, Wildlife Conservation Society and Noel Kempff Museum released a joint study finding that this pipeline goes through primary tropical forest in violation of OPIC's standards.

More than sixty environmental organizations from twenty-five countries have flooded OPIC with letters urging it to deny financing.

Local Bolivian Environmental Groups are in complete opposition to the project and are conducting further field reports.

A Chiquitano Forest Conservation Program has been established, but local Bolivian organizations have no decisionmaking control. Decisions impacting their land and conservation are in the hands of oil and gas companies and international conservation groups that are not trusted by local organizations and communities.

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Solutions

1) There should be an independent congressional investigation into this project that compares the public relations presentation of OPIC with field reports of internationally respected conservation organizations and local indigenous organizations. Until a truly independent inspection is conducted, OPIC financing should be either revoked or delayed.

2) OPIC should follow the lead of the International Finance Corporation - the World Bank's private sector lending arm - and establish an independent "ombudsperson" to monitor the agency's compliance with its environmental policies. OPIC purports to follow World Bank standards but has failed to establish an accountability mechanism comparable to that of the Bank.

3) OPIC must require Enron and Shell to relinquish control over decision

making of the Chiquitano Forest Conservation Fund to a group of Bolivian citizens dedicated to and qualified to promote the mission of conserving the chiquitano forest, of high integrity and representative to major stakeholders in the area.

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