24 July 2013
Chinese banks have been notified that several Australian-
Under the Green Credit Directive issued in 2012, Chinese banks are specifically obligated to strengthen and regulate the management of environmental risks for loans made to overseas projects. Chinese banks assess the environmental and social impacts of their loans, ensure clients uphold international norms, and have the power to deny finance, suspend and even terminate a granted loan in cases where major risks have been identified.
“All too often, when banks are made aware of environmental risks to a project or industry, they lack a clear decision-
A key issue raised in the letters was the threat posed by new coal export terminals to the Great Barrier Reef’s World Heritage Status. The World Heritage Committee will consider placing the Reef on the “World Heritage in Danger” list in 2014, their concerns driven largely by the uncontrolled expansion of coastal development. Both GVK and Adani are attempting to reach financial close for their proposed coal export terminals – which would be built in the Great Barrier Reef World Heritage Area – this year.
“No bank will want to be known as a funder of the project that cost the Great Barrier Reef its World Heritage status. Hopefully the Green Credit Directive will ensure that this title will not end up with a Chinese institution”, said Julien Vincent, Market Forces Lead Campaigner.
Research by Market Forces released in June showed that Chinese banks have provided almost AU$4 billion in loans to coal and gas export projects between 2008 and 2012. GVK had previously identified the China Exim bank as interested in financing their Alpha Coal project1, a 30 million tonne per year export coal mine, 500 km rail line and new coal export terminal at Abbot Point in Queensland.
A copy of the letter can be found at www.marketforces.org.au/GCDletter.pdf
For further information visit www.marketforces.org.au/banks