Future of Europe’s most controversial infrastructure project looks shaky
Turkey’s controversial Ilisu Dam project now looks increasingly unlikely to go ahead as its main backer pulls out.
The building giant which led the consortium to build the $1.52 billion Ilisu Dam project in southeastern Turkey, Balfour Beatty, announced its pull out on 13 November, following “a thorough and extensive evaluation of the commercial, environmental and social issues inherent in the project”. The future of the controversial project, which would see the ancient city of Hasankeyf submerged, around 44,000 Kurds forcibly resettled, control River Tigris water supplies upstream of Syria and
Iraq, and was recently condemned for being in breach of the European Human Rights Act (see related story), has now been cast into serious doubt.
Balfour Beatty, which was to have been the recipient of at least $200 million in export credit guarantees from the UK Government, and thus the leading creditor of the project, together with its international partner in the civil engineering joint venture, Impregilo of Italy, withdrew from the project, following a lack of Turkish progress on four conditions set by the Export Credit Agencies before approval (see related story).
Balfour Beatty believes the project could only proceed with substantial extra work and expense and with considerable further delay. The company says that commercial discussions between the Turkish General Directorate of State Hydraulic Works (DSI) and the consortium of which Balfour Beatty is a part have been under way for a considerable period, but the parties have, “been unable to agree in some areas and a number of commercial issues remain unresolved”.
“Our determination to consider this project in a thorough and professional manner has remained consistent since we were first invited to become involved,” commented Balfour Beatty Chief Executive Mike Welton. “We have followed all the appropriate steps to evaluate its viability and have not been deflected from proper, professional processes. The urgent need for increasing generating capacity to meet Turkey’s development needs and for social and economic development in the region remains. We have, however, clearly reached a point where no further action nor any further expenditure by Balfour Beatty on this project is likely to resolve the outstanding issues in a reasonable timescale.”
“It is a commercial matter for Balfour Beatty and, now that they have pulled out, it puts an end to British export credits for the project,” a spokesperson for the Department of Trade and Industry’s Export Credits Guarantee Department told edie.
Environmental and human rights campaigners have responded with delight to the news. “This is a tremendous win for campaigners against a disastrous dam project,” commented Friends of the Earth UK (FOE) Director Charles Secrett. “The story of the Ilisu Dam project shows the need for laws which require British companies to adopt clear ethical and environmental standards in their work abroad as well as at home. Certainly, backing such as export credits should never even be considered in cases which involve such obvious environmental destruction and abuse of human rights.”
“We are delighted by this,” said Kerim Yildiz of the Kurdish Human Rights Project. “This Ilisu campaign is a great example of environment and human rights groups fighting together to be effective.”
The Turkish government is still determined to press ahead with the roject, but in the depths of its biggest economic crisis in years, it remains to be seen where funding will now come from.
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