Letter from the Secretary of State for
Trade and Industry to the Chairman of the Committee
I am writing in response to the Committee's report
of 9 May 2001 regarding the Ilisu Dam. I have read this with interest
and noted the Conclusions and Recommendations and my comments
on the Conclusions and Recommendations of the report are attached
and, in turn, I would welcome any further observations that the
Committee may wish to make.
You will of course be aware that the long awaited
Environmental Impact Assessment Report (EIAR) on the project has
now been made publicly available, and a copy has been sent to
the Committee. We must now consider whether the final report addresses
our concerns about the project, and in particular the four conditions
set out by Stephen Byers in December 1999.
The resettlement of the local population is one of
our key concerns. We still await completion of the Resettlement
Action Plan being drawn up by the Turkish authorities with a resettlement
expert. I shall be seeking expert advice on whether this and our
other concerns are met and consulting my ministerial colleagues
before taking a decision. I can assure you that ECGD cover will
not be given for this project if we are not satisfied that the
undoubted major environmental and social impacts of the project
are being properly addressed, and that the financial risk is acceptable.
(A) We reiterate our conclusion that there should
indeed be a debate on the grant of export credit for the Ilisu
dam before Ministers decide. Parliament is entitled to nothing
less (paragraph 3).
As stated in our responses to the previous Trade
and Industry Committee Report and to the International Development
Committee Report, the Government will consider the Committee's
recommendation for a debate carefully, depending on the availability
of Parliamentary time. I understand that three dates in July have
been proposed but unfortunately time was unavailable. There was
a debate on the Ilisu project in Westminster Hall on 15 February
(B) It is not the first time that our detailed
consideration of the request for export credit for the Ilisu dam
has been bedevilled by excessive secrecy (paragraph 6).
It is reassuring to learn that the Turkish authorities
were happy to discuss the Resettlement Action Plan with the Committee
and to allow a copy of the Kudat Report to be placed in the Library
of the House. ECGD is of course obliged to take account of the
legal rights of those who provide documents to it, particularly
where such documents are provided in confidence. We have however
made available those documents which we are entitled to publish,
and on 3rd July 2001 the Government announced that the Environmental
Impact Assessment Report would be made publicly available and
that the public would have the opportunity to comment on the Report.
(C) It is not for a UK parliamentary committee
to pronounce whether the dam should be built. We have seen our
task as being to discover the truth about the project, so that
Parliament and Ministers can come to a satisfactory conclusion
on the grant of export credit (paragraph 10).
The Government welcomes the comments of the Committee
on the project, and the contribution which it has made to our
establishing some of the essential facts. We will take this into
account in our decision.
Resettlement - General
(D) The resettlement of those displaced by the
dam, and the replacement of the income for those who will lose
their livelihood, remain our principal concerns. If an acceptable
and credible plan were presented, which we had grounds for believing
would be implemented fully and effectively, we would not recommend
refusal of export credit simply because of the scale of population
disturbance (paragraph 25).
Resettlement - Prospects for Those Displaced
(E) World Bank standards require that prospects
for those displaced be no worse than before. It is not enough
to hope that something will turn up. What is required is both
detailed and costed planning, and firm evidence from previous
experience that implementation will match intention. In advance
of a view of the Plan we are sceptical on both counts (paragraph
Resettlement - Landless
(F) Our principle concern is over the fate of
landless people displaced by the reservoir, because either their
housing or the land on which they work as labourers is to be inundated.
We are concerned at the way in which the system seems to disregard
the need to replace the livelihood of those without land assets
whose income source is to be removed or reduced. The Kudat Report
notes that the future of the landless, the uneducated and women
displaced pose the greatest challenge and "will be the measure
against which civil society evaluates the Ilisu RAP". We
do not dissent from that (paragraphs 33 and 38).
Resettlement - Numbers
(G) What matters is not the exact numbers of households
or people, but that the area has or will be sufficiently fully
surveyed to ensure that enough funds are laid aside for compensation
and resettlement, and that the people involved are all consulted
about their future (paragraph 41).
(H) That the consultation process on the dam has
been flawed in the past is not seriously contested. It is not
our judgement that this need of itself means that the project
should not be given export credit. It does, however, place a strong
onus on the Turkish authorities to be able to demonstrate that
they are now proceeding strictly by the book, and in accordance
with the highest standard expected of a country seeking to be
accepted in due course into membership of the European Union.
The RAP will have to demonstrate to its readers that they have
done that (paragraph 47).
We agree with the importance which the Committee
accords to resettlement and the social impacts of the project,
and the necessity of providing proper mitigation of those impacts
and development opportunities. The revised Environmental Impact
Assessment Report provides further information regarding resettlement,
particularly the scale of resettlement involved. However, we will
need to see the final Resettlement Action Plan which is not yet
available. We shall be fully analysing the information we have.
Upstream - Water Quality
(I) We are disappointed to have learned that the
necessary wastewater and sewage treatment projects seem to be
low in the pecking order of priorities for public financing. If
export credit is required, we would be happy to see UK funds and
companies committed to construction and maintenance of water and
sewage systems of general benefit to the populace. We also look
to the revised EIAR to clarify the extent of water and sewage
treatment proposed, since the nature and intensity of the treatment
naturally is crucial for the impact on water quality (paragraph
Upstream - Returned Waters From Irrigation
(J) We expect the revised EIAR to address the
issues of the quality of returned waters from irrigation schemes
and the effects of upstream irrigation scheme on water flow; if
it does not, Ministers should insist that they be addressed (paragraph
We will be assessing the information contained in
the revised Environmental Impact Assessment Report regarding water
quality. There has been some progress on construction of water
treatment plants, but it does appear that there is a risk to water
quality from agricultural run-off..
Downstream - Irrigation
(K) It is nonetheless important that there should
be an assurance that the take-off of these waters does not diminish
the minimum assured water flow, which can presumably be measured
at the point of the Tigris leaving Turkish territory, and that
the EIAR addresses any question of water quality arising from
the volumes of returned water from irrigation projects downstream
of Ilisu (paragraph 63).
Downstream - Flows
(L) What we recommended a year ago, and repeat
now with greater urgency, is that the ECAs should satisfy themselves
through independent technical analysis that the proposed formula
for downstream flows is equitable in all the circumstances (paragraph
We will be assessing the information contained in
the revised Environmental Impact Assessment Report regarding downstream
Consultation with Neighbouring States
(M) Published confirmation that Turkey has consulted
neighbouring states is, to the best of our knowledge, still awaited
We are still awaiting confirmation on this point.
We have always made it clear that this is of prime importance.
(N) The fact has to be faced that the Ilisu dam
would mean the end of Hasankeyf and the loss of that part of the
Turkish national heritage, and that future funding will at best
be directed to rescue. We sense that if classical remains were
thus threatened there would be more concern. We reiterate our
view that ECAs should commission some independent assessment of
the adequacy of the Turkish administration's funding of plans
for Hasankeyf (paragraph 72).
Plan for Archaeology
(O) We are entitled to see a realistic archaeological
plan as required in the Secretary of State's announcement of December
1999. We still await the Government's proposals for a review of
that plan. We consider that the condition should be extended to
cover the whole of the reservoir area and land affected by it,
and that a "detailed" plan must by definition include
costing (paragraph 78).
We have not yet seen a full salvage plan for the
Ilisu Reservoir. However, the reports of the archaeological activities
covered by the Salvage Project for the Archaeological Heritage
of the Ilisu and Carchemish Dam Reservoirs for 1998 and 1999 do
include the reservoir area and not just Hasankeyf. We are still
discussing how such a plan might be reviewed when we see it.
Conclusions - Sustainable Development
(P) We have a strong feeling that if Turkey were
in the EU, the requirement for sustainable development would lead
the authorities and the population to question the rationale for
the expenditure on the Ilisu project. It may be thought that the
future of the region would be better served by expenditure on
infrastructure designed to sustain the income of the rural poor
by retaining them on the land engaged
in productive activity and indeed attracting back some of those
displaced to the cities for security or other reasons. That must
be for the Turkish people to decide, particularly in the light
of the financial difficulties the country has been facing in recent
months (paragraph 79).
As the Committee acknowledges, the final decision
on the project is for the Turkish authorities. However, it is
important that the decision takes into account sustainable development
and value for money questions.
Conclusion - Resettlement
(Q) When we reported last on the Ilisu dam and
the application for export credit, over a year ago, we had not
expected to have a second opportunity. The time for a decision
is now presumably nearer. In the absence of the EIAR and the RAP
we cannot give our firm view. It may be that the contents of these
documents will allay our concerns. These concerns have grown rather
than diminished over the past year, primarily on the resettlement
prospects of those without land and without much prospect of replacing
their income whether resettled in the towns or the countryside
We would welcome the further views of the committee
on the project, in the light of the Environmental Impact Assessment
Report. We have supplied the committee with a copy of the Environmental
Impact Assessment Report. If the Committee require further copies
of the Environmental Impact Assessment Report, ECGD (Ilisu Dam
Project branch) will provide them.
Conclusions - Criteria and EU Standards
(R) The criteria have not yet been met. Based
on past experience, we are not confident of the capacity of the
Turkish authorities to meet conditions that would satisfy the
European Union standards (paragraph 81).