The ability of extractive industry projects to contribute to poverty alleviation has been seriously questioned, as in general countries that have the largest quantity of natural resources are the poorest and most politically unstable ones. In practice, the exploitation of oil, gas and mineral resources often leads to corruption, conflicts over resources and the impoverishment of local communities.

However, today the EIB is the leading international public lender in the extractives sector. In 2006, the EIB provided 49 percent of total global funding provided by all the international financial institutions for extractives. For oil and gas extraction in 2006, its share of global IFI support was 58 percent.

Most of the projects financed in the extractive sector have been large, capital intensive projects. Between 2000 and 2006, in the Africa, Caribbean, and Pacific (ACP) region, the EIB loaned more than EUR 364 million to the mining sector, with highly debatable pro-poor consequences. In the oil and gas sector, the EIB is involved in very controversial projects like the Chad-Cameroon oil pipeline and the West African gas pipeline, both of which attracted widespread local opposition before financing and whose impacts on affected communities have been almost unilaterally negative.

Such investments are primarily of benefit to industrialised countries. The resources are exploited by multinational corporations from rich countries, and exported to Europe, the United States, or emerging countries.

It should be kept in mind that in the ACP countries the EIB operates under the Cotonou Agreement, the mandate of which is “reducing poverty with the objective of sustainable development”. At the same time, the EIB lacks the necessary binding environmental and social standards to ensure adequate assessment of such projects before they are approved – as they inevitable always are – for financing..

Our demands

• By 2012 the EIB should completely phase out its lending for fossil fuel projects both inside and outside the EU.
• The EIB should adopt a moratorium on investments in mining projects until it has adopted the highest international standards concerning the environment and social protection in order to properly mitigate the impacts of mining projects.