Public finance for development

Dutch taxpayers' money must be spent in the public interest. The government uses some of it to finance and support projects and activities abroad. It does this through various channels, including Dutch development bank FMO, multilateral banks like the World Bank and special funds such as the UN's Green Climate Fund. In addition, the Dutch state supports high-risk export activities through export credit agency Atradius DSB. To serve the public interest, government expenditure on projects and activities abroad must help prevent damage to people and the environment.

Before deciding to support a project, all institutions operating with public money should assess whether it disadvantages certain groups and whether they receive ample compensation, whether it causes environmental damage and who is responsible for remedying it, and whether the project contributes to sustainable development.

Large-scale infrastructure and agriculture

Large infrastructural projects, such as dams or hydropower plants, are examples of activities which may cause considerable damage. Development banks and other public finance institutions often see them as green energy providers, but fail to take into account what happens to the areas which are submerged, or further downstream when a river is cut off.

Or take large-scale, intensive farming. Often seen as the perfect solution to food scarcity and poverty, it can lead to monocultures and negative impacts on farmers who have been growing food informally for many decades, i.e. without having formal rights to the land they cultivate.

The primary aim of export support, provided in the Netherlands on behalf of the government by export credit agency Atradius DSB, is not to promote sustainable development but to advance Dutch exports. Because they act in the public interest, Atradius DSB, too, should ensure that only projects meeting high social and environmental standards receive export support.

Social and environmental criteria not sufficiently binding

Most public finance institutions commit themselves to social and environmental regulations of some kind, but these are often non-binding and are not adhered to in practice. Both ENDS has been following a number of these institutions, like FMO and Atradius DSB, for several years, monitoring whether they adhere to their own social and environmental criteria and confronting them if they do not. Together with partner organisations from across the world, we continuously advocate for adherence to, and strengthening of, the existing criteria used by the various institutions. In addition, we show how development finance can be utilised to achieve real sustainable development.

Our work on the subject of Public finance for development

  • Dossier

    Green Climate Fund: calling for local access to climate finance

    Local organisations and groups must be given access to climate finance from the Green Climate Fund. They know exactly what is happening in their local context and what is required for climate adaptation.
  • Dossier

    Paris Proof Export Support

    Almost two-thirds of the export credit insurances that Atradius DSB provided in the 2012-2018 period went to the fossil energy sector. That is contrary to the climate agreements that the Netherlands signed in Paris. 
  • Dossier

    Agua Zarca: indigenous fight against dam costs lives

    Indigenous Hondurans are resisting the construction of the Agua Zarca hydrodam. Their fight has cost several lives, including that of Berta Cáceres. After considerable public pressure, Dutch development bank FMO withdrew from the project.
  • Dossier

    Large-scale infrastructure

    Large-scale infrastructural projects have detrimental effects on local people and the environment, while their benefits are felt elsewhere. Both ENDS is working to ensure that local people have a greater say in decision-making and is investigating the way these projects are funded.
  • Dossier

    Export Credit Agencies: Who pays the price?

    Both ENDS calls on the government only to provide export credit insurance to sustainable projects that cause no social and/or environmental damage in the countries where they take place.
  • Dossier

    Suape: port expansion threatens paradise

    Two projects insured by Atradius DSB in the Brazilian port of Suape have caused serious social problems and environmental damage. Both ENDS is helping the local people to obtain justice.
  • Dossier

    Indigenous communities threatened by Barro Blanco dam in Panama

    The Barro Blanco dam project in Panama, which has Dutch financial support, is causing indigenous lands to disappear under water. Both ENDS is working to protect the rights of indigenous communities living near the dam.
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