Despite violence, 900 million euros in Dutch export support to Van Oord in Mozambique
Amsterdam, 19 May 2021 – On 25 March, a day after violent attacks in northern Mozambique, the Dutch state decided to provide dredging company Van Oord with export credit insurance worth 900 million euros for its activities in the country. The company is conducting dredging operations for a highly controversial gas project that, according to Mozambican interest groups, is playing a prominent role in the escalating violence in the region. Civil society organisations Both ENDS, Milieudefensie and Oil Change International and their Mozambican partners are alarmed about the situation and have called the Dutch government and Dutch export credit agency Atradius DSB to account.
On 24 March, there was a violent attack in the town of Palma, which led to dozens of deaths and caused thousands of people to flee their homes. Employees of multinational companies like Van Oord and Total had to leave the area under armed escort. Total has provisionally suspended the project, claiming force majeure.
"State Secretary for Finance Hans Vijlbrief and Minister for Foreign Trade and Development Cooperation Sigrid Kaag decided a day earlier to approve the enormous export credit insurance", says Niels Hazekamp of Both ENDS. "Inconceivable and a slap in the face for all the residents of the area, who are the victims of the gas project. Unfortunately, despite our attempts to obtain information, the ministries and Atradius DSB themselves are anything but transparent. The insurance has now been approved with no further explanation – and for 900 million euros rather than the 600 million originally mentioned."
Human rights violations, climate damage and economic risks
Civil society organisations have been involved in discussions on this project with the ministries and Atradius DSB for several years and have warned from the beginning of the human rights violations, climate damage and economic risks it brings with it. Farmers and fishers have lost access to their fertile land and fishing grounds and have had to leave their homes. The gas extraction has fuelled the unrest and violence in the region. Since 2017, more than 2,600 people have been killed and half a million forced to flee their homes.
"The Dutch state should never have provided insurance for activities that violate human rights, exacerbate the climate crisis and create economic risks in the first place," says Laurie van der Burg of Oil Change International. "Van Oord should never have decided to invest in the project. The local people are left behind with all the destruction it has caused and are receiving help from no one, while Van Oord can now stop relatively easily because it can retrieve its losses from Atradius DSB – in other words, the Dutch state."
Fossil infrastructure is becoming worthless
"Almost a billion euros in export support for a fossil project not only goes completely against the climate goals of the Paris Agreement but also saddles Mozambique with an enormous fossil infrastructure – and the risks it brings with it", says Isabelle Geuskens of Milieudefensie. "With the whole world changing to sustainable energy, Mozambique would benefit much more from sustainable energy projects. There is enormous potential for such projects but this is not being taken advantage of, partly because of fossil investments. It is worrying that the Dutch state is giving priority to the short-term economic interests of Dutch companies at the expense of human rights, climate justice and a sustainable economy in Mozambique.
Such abuses have recently also come to light in other projects insured by Atradius DSB. Civil society organisations therefore call on the ministers and decision-makers involved to give account for this decision, to no longer provide support for fossil energy projects in the future and to come up with a plan to provide as much help as possible to the Mozambican people affected by this project. They are also demanding a plan to ensure that such projects are not provided with support in the future. "In terms of export support, too, the government is in need of new leadership," says Hazekamp. "Transparent, human rights to the fore, and fossil-free."
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In 2011 one of the world’s largest gas reserves was found in the coastal province of Cabo Delgado, in the north of Mozambique. A total of 35 billion dollars has been invested to extract the gas. Dozens of multinationals and financiers are involved in these rapid developments. It is very difficult for the people living in Cabo Delgado to exert influence on the plans and activities, while they experience the negative consequences. With the arrival of these companies, they are losing their land.
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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.
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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’
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