Norway bank divests from firm helping to build a destructive dam in World Heritage Site
Norway’s central bank has withdrawn investment in an electrical company helping to build a massive Tanzanian hydropower project, being campaigned against by EIA, citing ‘serious environmental damage’.
On the eve of Endangered Species Day (15 May), Norges Bank has disposed of its $7.5m stake in the Egyptian company working on a major dam project in a Tanzania game reserve which is home to endangered elephants, black rhinos and African wild dogs.
The $2.9bn Rufiji hydropower dam project is being constructed in Stiegler’s Gorge, in the Selous Game Reserve, which is listed as a UNESCO ‘World Heritage Site in Danger’.
There has been significant opposition to the project, citing the potential devastating impacts on local communities as well as on the reserve’s rare wildlife, including elephants and critically endangered black rhinos.
Following advice from its Council of Ethics, Norges Bank, which administers investments on behalf of the Norwegian Government’s pension fund, has withdrawn its money from Elsewedy Electric Company because it was decided that “the scale envisaged at Stiegler’s Gorge, and in a World Heritage Site in Danger, constitutes serious environmental damage.”
EIA has been at the forefront of the campaign against the construction of the hydroelectric power plant, which will occupy an area of 1,350 sq km of the reserve.
Executive Director Mary Rice said: “This action by the Norges Bank sets a shining example for investors globally to follow in ensuring that their investments do not harm the environment.”
UNESCO has repeatedly expressed grave concerns about the irreversible damage that will be caused by the project and has urged the Government of Tanzania to pull the plug on the project and explore alternative sites for the massive dam, which will have a 100km reservoir.
But despite these concerns, the Government awarded contracts in December 2018 to a joint venture of Egyptian companies Elsewedy Electric and Arab Contractors for the development of the project.
The joint venture, in which Elsewedy Electric holds 45 per cent of the shares, is mobilising financial support for the dam and has entered into a contract valued at $969 million with the Chinese State-owned company Sinohydro; African Export-Import Bank (Afreximbank), Cooperative Rural Development Bank (CRDB) and United Bank for Africa (Tanzania) have also offered financial assistance for the construction.
“As the project appears to be moving forward at full speed, it is critical that Elsewedy Electric, Arab Contractors, Sinohydro, Afreximbank, CRDB and United Bank for Africa (Tanzania) reconsider the development of the dam,” added Rice.
“We urge all other investors who may be providing financial support for the project to follow Norges Bank’s lead in taking urgent action to protect one of the last remaining large-scale wilderness areas in Africa.”