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Paris Proof Export Support

Two-thirds of the export credit insurances that Atradius DSB provided in the 2012-2015 period went to the fossil energy sector. That is contrary to the climate agreements that the Netherlands signed in Paris. 

In December 2015, the Netherlands signed the Paris Climate Agreement, under which global warming has to be limited to a maximum of 2 (preferably 1.5) degrees Celsius. A growing number of companies are making their production methods more sustainable and are switching to renewable energy, to minimise or even halt the negative impact of their activities on the climate. But Dutch companies do not only operate in the Netherlands. On the contrary, many of our economic activities take place abroad, and the negative effects of these activities are therefore mostly felt there. To achieve the transition to a sustainable economy, it is therefore vital that we also devote attention to making Dutch activities abroad more sustainable.

Government support

The Dutch government promotes the export of goods and services in many ways, for example with grants and tax arrangements. For very large-scale and high-risk activities abroad, it provides export credit insurance (see dossier on ECAs). Both ENDS believes that this public support for foreign trade should contribute to sustainable development for all, and not just benefit Dutch companies. This means that, to be eligible for export support, Dutch activities abroad should not be harmful to people and their environment in the countries where they take place. Furthermore, they should always be in line with the climate goals set in Paris in 2015.

Two-thirds to the fossil fuel sector

This is by no means always the case. Both ENDS analysed all of the Dutch export credit agency Atradius DSB's transactions during the 2012-2015 period, which showed that the company provided insurance to projects related to the fossil fuel sector worth a total of €7.3 billion. That is two thirds of the total value of insurance provided by Atradius DSB during that period.

The vast majority (92%) of Atradius DSB support for projects in the fossil fuel sector goes to the offshore and maritime sector. For instance to shipyards that build pipe-laying vessels and floating drilling rigs, known as Floating Production, Storage and Offloading ships (FPSOs). Or to dredging companies that dig port channels for the transshipment of fossil fuels (see dossier on Suape) or raise coastlines so oil refineries can be built on them. In this way, the export credit insurances provided to Dutch exporters of such projects greatly contribute to the expansion of the infrastructure of the global oil and gas sectors.

Public funds to support the fossil fuel sector

The Ministry of Finance holds primary responsibility for the policy of Atradius DSB and parliament has an important role as supervisor. So far, there has been no political discussion about the extent to which Atradius DSB supports the fossil fuel sector and how this can be aligned with the agreed climate goals. The Dutch government appears to see no problem in using public funds to support the fossil fuel sector.

Sustainable trade and investment policies

If the Netherlands wants a green and inclusive economy, the government should ask itself how export credit insurances for the fossil fuel sector can be stoped and used to support green, sustainable transactions. The Netherlands should focus much more on energy efficiency, energy saving, sustainable mobility, and solar and wind energy. The aim to achieve a climate-neutral economy must therefore be reflected in our trade and investment policies. Both ENDS realises that phasing out export credit insurance that supports the fossil fuel sector will be a gradual process. But we can no longer postpone the discussion on how that process should be conducted.

Sustainable Export Support

Both ENDS calls on the Dutch government and parliament to ensure that the export credit insurance provided by Atradius DSB is in line with the climate goals of the Paris Agreement. The report 'Paris Proof Export Support' contains a number of recommendations to achieve that. These recommendations are summarised below:

• Publicly report with clear and understandable information on all export credit insurances for export transactions that contribute to the fossil fuel sector
• Set an ambitious date – preferably 2020 – at which all export credit support is directed towards business transactions that contribute to low-carbon and climate-resilient development (and is no longer provided for fossil fuel-related transactions.)
• Start the phase out of export credits for fossil-fuel-related transactions by ending the support for brand-new fossil fuel extraction, transportation and processing infrastructure projects first.
• Promote the creation of an exclusion list for fossil fuel-related projects (coal, oil and gas) to be adopted by all ECAs at the OECD.

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FPSO_by PAC on Flickr

FPSO_by PAC on Flickr
(FPSO_by PAC on Flickr (admin), 27/02/2018)