Where are the opportunities for Minister Kaag?
More than six months after the Dutch elections took place, a long period of debates, negotiations and incertainty has finally come to an end. The new coalition of center-rightwing parties was sworn in last Thursday the 26th of October. Having Sigrid Kaag of the liberal-democratic party D66 as the new Minister for Foreign Trade and Development Cooperation in the third Rutte government (Rutte III), we can look forward to where the opportunities lie in the new coalition’s plans to make the world fairer and more sustainable. The Coalition Agreement, which tries to build a bridge between the political centre and the centre-right, is a smart piece of work in terms of reaching compromises. In the current international climate of societies progressively growing apart, that is a striking achievement.
Because the Agreement does not specify very much explicitly, it gives the Minister for Foreign Trade and Development Cooperation a lot of elbow room to make a difference in international policy. That presents the Netherlands – which, as an open economy, has a great impact on people and the natural environment far beyond our own borders – with many opportunities. But there are also serious threats lying in wait.
The Netherlands, its people and its businesses
Minister Kaag is faced with one main challenge: the Coalition Agreement focuses almost exclusively on the Netherlands and its people. Rutte III does not appear willing to recognize that it is now responsible for a Netherlands which – as the world’s 17th largest economy, as a provider of services to the fossil industry and as an essential link in a globally destructive agricultural model – has an enormous impact on people and their living environment throughout the world. Rutte III’s approach threatens to be a continuation of that of previous governments, which also seemed to consciously ignore the Netherlands’ global role and our worldwide impact.
To prevent this policy from leading to further violations of human rights and destruction of the natural environment, it is of the greatest importance that – together with businesses, members of parliament, scientists and civil society organizations – Minister Kaag ensures that existing international agreements on human rights and environmental protection are upheld. As an international diplomat who knows the UN like the back of her hand, she will understand the fundamental importance of global agreements on human rights and the environment.
The minister can ensure that funds provided by the Dutch government comply with international standards. The institutions that bear an important responsibility to safeguard this – the OECD National Contact Points, regional human rights committees, the ICC – must be supported actively and in the long term. The importance of this support is underlined by the fact that Rutte III rightly identifies promoting the rule of law as one of the four spearheads of its policy. The Netherlands will therefore have to continue to invest in strengthening the international legal order, so that businesses and financial institutions can no longer violate human rights with impunity.
Green and sustainable
The Coalition Agreement seems to be responsive to the enormous social pressure to take climate change seriously. As the Netherlands is one of the EU member states that consistently fails to comply with climate agreements, this is in itself an urgent step in the right direction. The reactions from opinion leaders, civil society organizations and businesses show, however, that the words of Rutte III are not convincing.
Despite the surprisingly optimistic ambition to store our climate waste in the ground, it is very striking that the Coalition Agreement does not mention one of the most important keys to achieving sustainability: making our own government budget fossil-free. The fact that there is nothing about this in the Agreement offers opportunities, as the discussion on the 8 billion euros in state support for the fossil sector is just starting to gather momentum. Debates have been planned, motions have been adopted that demand greater transparency in this area, and the Dutch Central Bank (DNB) is increasingly insistent that climate risks have to be made more visible.
So there are certainly opportunities in the coming years to put an end to the billions of euros that the Dutch government provides to the fossil sector in the form of subsidies, tax benefits and export credit insurances. Many of these instruments fall directly under the responsibility of the Minister for Foreign Trade and Development Cooperation. If Minister Kaag makes her budget fossil-free in the coming years, it will give the renewable energy sector and other climate-relevant sectors an enormous boost. And that would considerably reduce the harmful consequences of extracting and transporting oil, coal and gas for people and the environment in vulnerable countries and regions. It would also help Rutte III to fulfil its ambition to achieve the climate goals agreed in Paris.
Human rights and climate funding
Both ENDS is pleased that the government intends to allocate more money to protecting human rights and to strengthening the network of embassies and consulates. These two ambitions are strongly linked: embassies can play a prominent role in supporting civil society actors – organizations and individuals – who defend human rights, especially in respect of the human right to water, food and a safe living environment. Local civil society organizations must be able to contact embassies with suggestions and engage in a dialogue with them to identify violations promptly. Dutch embassies also have an important role to play in informing and supporting investors and businesses in respecting these rights.
Rutte III is making additional funds free to finance climate initiatives in other countries, so that they can prepare themselves for the effects of climate change. That presents an enormous opportunity to change the current international reality of climate funding, which has until now largely been focused on large-scale projects which benefit Western companies and banks at the expense of the people most directly affected by climate change. That money must be used to fund local actors, including municipalities, farmers’ cooperatives, women’s groups and indigenous groups. That can be effectively achieved by allocating money through 'small grants funds'. Only by meeting the actual needs of people themselves in this way will the additional climate funds to be allocated by Rutte III properly supplement existing forms of international climate financing.
Underlying causes of poverty and migration
Rutte III acknowledges that underdevelopment has a great impact on migration flows and rightly states that the underlying causes of migration need to be addressed. Those causes lie mainly in lack of security, erosion of the natural environment and the destruction or expropriation of local living resources, a lack of public infrastructure and good governance, land and water grabbing by developers of large-scale infrastructure, mining and agricultural projects, and the consequences of climate change.
The challenge for Minister Kaag is not to take the Coalition Agreement too literally. At first sight, Rutte III seems to address the underlying causes of migration by providing facilities for migrants in their own regions and by increased border controls. That is, to put it mildly, a very one-sided view of migration, from the small-minded perspective of a Netherlands that does not feel itself to be part of the global community. We feel confident that, with her track record, the new minister will look further than the words of the Coalition Agreement and will generate synergy between the four spearheads of policy – agriculture, water, sexual and reproductive health and rights (SRHR), and promoting the rule of law – and the complex issue of international migration.
Free trade and international investment
The Coalition Agreement continues the line of Rutte’s previous government, by seeing trade as an integral part of foreign policy. Its aim is to ensure ‘fair free trade’. That sounds simple, but it would call for a great change in the Netherlands’ current position. The trade and investment agreements that we currently conclude are everything but ‘fair’, limiting the development of poorer countries by not allowing them to protect their emerging industries. The agreements ensure, as they have been doing since the colonial era, that poor countries continue to supply the rich West only with primary raw materials.
The reality is that, under the current system of trade relations, developing countries will always get the worst deal. To make trade fair, the minister will have to impose binding rules on governments and businesses, so that all parties, as far as possible, have equal opportunities. To achieve this, she will have to, at least, pursue the line set out by the previous government. That means that the negotiations on trade and investment agreements will have to become transparent, that there will have to be thorough discussion on the desirability (or not) of investment agreements, and that efforts must continue to strengthen open dialogue with political and civil society organizations both at home and abroad. In addition, through international diplomacy, resolute steps must be taken to strengthen the international legal system, so that businesses no longer have only rights, but also a binding duty to respect all human rights, including those relating to labour, the environment and self-determination.
Like civil society organizations, the minister will also have to look further than the trade and aid agenda. If Rutte III really wants to promote free trade, it will have to ensure that Dutch and other international companies pay taxes in the countries where they get their raw materials from and where their production and often their markets are located. Only then can the governments in those countries create the public infrastructure required to develop their own economies in the longer term. Rutte III, however, is doing the complete opposite: it is relaxing the rules for businesses to report where they pay taxes and is not doing enough to reduce the key role played by the Netherlands in facilitating tax evasion.
Where are the opportunities?
The ecological and social footprint of the Netherlands’ international trade and investment activities is immense. This Coalition Agreement does not address measures to reduce that footprint, despite there certainly being opportunities to do so.
The soon to be set up INVEST-NL – the new window for risk capital, guarantees, export credit insurance and international financing programmes – is a good example. Around a third of the total of 2.5 billion euros to be set aside for INVEST-NL is expected to be reserved for activities abroad. The minister, who has final responsibility for INVEST-NL’s international activities, will have to take steps, on behalf of Rutte III, to help bring about a genuine transition to a sustainable society. INVEST-NL should not only be made fossil-free, but also impose strict social and environmental rules on investments, and on the provision of credit and cover for investment risks. Such rules are indispensable to ensure that these activities do not have harmful effects on people and the environment in the countries where they take place.
The Coalition Agreement leaves ministers a lot of elbow room, because it does not explicitly mention a number of strategic issues. That presents them, including our new Minister for Foreign Trade and Development Cooperation, with enormous opportunities. To phase out state support for the fossil industry and its related companies, to make INVEST-NL a genuine transition fund with high environmental and human rights standards, and to get climate funds to the people who not only need them the most but who will use them most effectively. Together with our Dutch and international partners, Both ENDS will continue to engage in dialogue with the minister and her colleagues to achieve these ambitions within the new government’s term of office, which is crucial for the climate, environmental and development agenda.
Photo: by SOAS, University of London - YouTube; CISD Annual lecture by Sigrid Kaag, SOAS, University of London Still at 8:03 min, CC BY 3.0, https://commons.wikimedia.org/w/index.php?curid=63507028
Read more about this subject
In 2015, the member states of the United Nations committed themselves to the ambitious Sustainable Development Goals (SDGs). Unlike their predecessors, the Millennium Development Goals (MDGs), the SDGs recognise the importance of equality within and between countries, of decision-making processes in which all people are included and heard, and of legal systems that are independent and accessible to all.
Press release / 5 December 2022
Groups react with dismay to FMO’s position statement on Financial Intermediaries, pointing to outstanding human rights and climate concerns
On October 13th 2022, FMO published the final version of its Position Statement on Impact and ESG for Financial Intermediaries (FI statement). As civil society groups which have engaged with FMO on this topic for more than four years, we are extremely disappointed with the result. In the statement, FMO does not show sufficient commitment to ensuring its investments into financial intermediaries – which represent the bank's largest investment sector* – do not violate human rights or contribute to environmental harms.
Publication / 7 November 2022
Press release / 3 November 2022
The Netherlands breaks major climate promise to end public financing for international fossil fuel projects
Today, a week before the international climate summit in Egypt, the Dutch Government has broken a major climate promise it made last year to end public financing for international fossil fuel projects. International and Dutch NGOs argue that the new policy published by the Dutch Government on restricting finance for fossil fuels has such significant loopholes, that it essentially means The Netherlands has reneged on its promise.
News / 24 October 2022
The decision of Minister for Climate and Energy Rob Jetten to withdraw from the Energy Charter Treaty (ECT) is good news for the energy transition in the Netherlands and beyond. Governments of countries that are party to this treaty can therefore shape the transition to sustainable energy without having to fear claims by Dutch-based businesses.
Letter / 19 October 2022
In May 2022, Minister Hoekstra of Foreign Affairs and Minister Schreinemacher for International Trade and Development Cooperation announced that also The Netherlands will work towards implementing a Feminist Foreign Policy (FFP). This means that within its Foreign Policy, the Netherlands will pay more attention to inclusivity in general and specifically to women's rights and gender equality, including LGBTIQ+. This feminist lens will be central to all aspects of foreign policy; security, trade, diplomacy and international cooperation.
To foster an inclusive process and acquire insights in what a Dutch FFP should look like, the Ministry of Foreign Affairs opened an internet consultation. Both ENDS welcomes the FFP and therefore gladly shares its input and suggestions.
The lion's share of public budgets for climate, agriculture and development still goes to conventional agroindustrial projects that contribute to the current climate, food and biodiversity crises. Both ENDS and our partners are calling for a transition to agroecological practices that are people- and environment-friendly.
Letter / 30 September 2022
Last year at COP26, the Netherlands, alongside 38 other governments and institutions, committed to the Glasgow Statement on International Public Support for the Clean Energy Transition. By signing this statement, the Netherlands has committed to ending new direct public support for the international unabated fossil fuel energy sector by the end of 2022- a commitment it has yet to deliver.
With this letter, 20 civil society organisations call on the Netherlands to announce its implementation policies for the Glasgow Statement ahead of the Export Finance for Future (E3F) Summit on the 3 November. The E3F Summit is a critical opportunity for the Netherlands to uphold the commitments made in Glasgow last year, alongside all other E3F members.
The recent E3F transparency report highlighted that Netherlands insured 6x more fossil fuel transactions than renewables from 2015-2020, with 3 billion EUR in fossil fuel transactions compared to only 0.5 billion EUR in renewables. This demonstrates that a fossil-fuel exclusion policy for Dutch export support is urgent, and essential, to align the Netherlands with its Glasgow commitment and the Paris Agreement.
Publication / 29 August 2022
Press release / 25 May 2022
Award of export support for controversial project in Manilla undermines the Netherlands’ environmental and CSR ambitions
Dutch export credit agency Atradius DSB announced yesterday that it is to provide export credit insurance worth 1,5 billion euros to Dutch dredging company Boskalis for a controversial land reclamation project in the Philippines. According to Dutch and international organisations, including Both ENDS, CARE Netherlands, IUCN NL, Kalikasan PNE and Oceana Philippines, the award of export credit insurance for this project runs contrary to the Netherlands' ambitions in the areas of environment and corporate social responsibility (CSR).
News / 19 May 2022
Both ENDS and 95 other organisations* today sent a letter to State Secretary for Finance Marnix van Rij and Minister for Foreign Trade and Development Cooperation Liesje Schreinemacher calling on them to implement the Glasgow Declaration in full. In this agreement, which the Netherlands and 33 other countries signed at the Glasgow climate conference, the signatory countries pledge to stop all public funding for fossil projects by the end of 2022.
Press release / 19 May 2022
122 CSOs warn signatory countries they have only six months left to meet COP26 commitment to end international public finance for all fossil fuels
Today, 122 civil society groups are releasing letters to eleven government signatories to the Glasgow Statement on International Public Support for the Clean Energy Transition, laying out the actions they must take as soon as possible to meet their commitment. In this joint statement at COP26, 35 countries and 5 public finance institutions committed to end their international public finance for 'unabated' fossil fuels by the end of 2022, and instead prioritise their "support fully towards the clean energy transition."
Letter / 22 April 2022
Both ENDS, also on behalf of FERN, NCIV and Milieudefensie, sent a letter to Vivianne Heijnen, the State Secretary for Infrastructure and Water Management, about the MTCS certificate. In practice, this Malaysian timber certificate appears to tolerate the violation of indigenous land rights and intimidation of indigenous organisations. The Netherlands should therefore suspend the approval of MTCS in its purchasing policy, among other things.
News / 9 February 2022
TotalEnergies and the Chinese National Offshore Oil Cooperation (CNOOC) are currently developing an oil extraction and transportation project in Uganda: East African Crude Oil Pipeline (EACOP). The project – the construction of a heated pipeline (EACOP) of no less than 1445 kilometers through Uganda and Tanzania to export crude oil, is increasingly causing human rights violations and environmental damage. This is a matter of great concern to civil society organisations in Uganda and beyond. This week, Both ENDS, together with partner organisations in Uganda, sent an urgent letter to twelve pension funds and asset managers with investments in TotalEnergies and CNOOC.
Blog / 2 February 2022
On World Wetlands Day communities throughout the La Plata Basin are asking for support in their fight for their endangered wetland ecosystemsBy Eva Schmitz
The new year has barely begun but already record high summer temperatures are being reported in parts of South America, especially Argentina, Paraguay and Southern Brazil. The latest heatwave, with temperatures of up to 45C, arrives on top of two years of severe drought which had a devastating effect on the entire region. It is a painful reminder of the immediacy of climate change and emblematic for what happens when vital ecosystems are not protected and for the catastrophic consequences as much on already endangered wildlife as on the local communities who depend on them for their livelihoods. One of the most affected areas are the regions wetlands – unique ecosystems, which are crucial ecological pressure points, vital for the regulation of river systems and huge carbon sinks. Their loss not only has ecological impacts but affects thousands of local communities which depend on their health for fishing, tourism and local agriculture. The threat to them by for example droughts and fires, can be directly linked to the large-scale production of soy, produced mainly for export. This in turn means responsibility for what is happening in the region needs to be acknowledged and shared by leaders around the world, and especially large importers such as the Netherlands.
News / 22 November 2021
Export support – and especially that to fossil projects – has been in the spotlights quite often recently. This is a positive development, because the Netherlands alone provides fossil export support worth 1.5 billion euros per year. At the climate summit in Glasgow, the United Kingdom launched a statement promising to stop providing export support to fossil projects by the end of 2022. After having denied at first, the Netherlands decided to join the statement after all – which now has already been signed by nearly forty countries and financial institutions.
External link / 17 November 2021
Julio Bichehe Erneste of Farmers Union Cabo Delgado Mozambique (UPC) on a side event of COP26 in Glasgow, speaking about the negative impacts of export support for fossil fuel projects for local people and their enrironment, and about the need to support renewable energy projects instead.
News / 8 November 2021
Today, the Netherlands announced that it will join a leading group of countries, including the United States, Canada and Italy, which declared that they would stop international support for fossil energy projects. At the day of the launch of the declaration at the climate summit in Glasgow on the 4th of November, the Netherlands had no intention of joining, but because of pressure from civil society and political parties, the responsible ministries decided to sign after all. Both ENDS, together with organizations at home and abroad, has been pushing for this for years, and we are very happy with this step. We will of course continue to monitor developments.
Event / 4 November 2021, 16:45 - 18:00
UNFCCC COP 26 side event ‘Aligning export finance with the Paris Agreement: high time to phase out fossil fuels’
Many countries heavily support fossil fuel investments abroad through their export credit agency (ECA). This contributes to carbon lock- in, whereby companies or even countries commit themselves to a certain amount of greenhouse gas emissions for the lifetime of the infrastructure — oftentimes years or even decades. This seriously delays the transition to renewable energy sources, and is certainly not in line with Art. 2.1c of the Paris Agreement.
Highlighting the impacts caused by export finance in the global South, this side event will provide concrete recommendations to decarbonize export credit agencies.
Publication / 2 November 2021