European financing for a hydroelectric plant in Turkey was suspended on July 7 after Turkey failed to offer environmental protections in the area around the Tigris River where antiques from the Middle Ages will be flooded by the dam.
Austria, Germany and Switzerland cancelled US$630mn in state export-loan guarantees for the Ilisu project because Turkish plans to resettle towns and safeguard cultural treasures were not sufficient to meet World Bank standards, Vienna-based export agency Austrian Kontrollbank said in a statement.
The project calls for a new 1,200 megawatt power station as one of an eventual 22 dams and 19 power plants. Turkey had planned to relocate antiques and monuments from Hasankeyf, the region’s only surviving city built during the Middle Ages, with roots dating to the Assyrians.
A statement by the Austrian Kontrollbank says: “Compliance with international standards is an essential element for the acceptance of export risk insurance. They are set down in the OECD’s environmental guidelines and were an important condition for the implementation of the project from the very start.”
The bank states that this is why before export risk insurance was accepted, extensive agreements were made between the project managers and export credit agencies that vastly improved the original project terms. “This was set down in some 150 requirements which took into account both the World Bank standards and the recommendations by the World Commission on dams,” the statement reads.
The Ilisu project is a cornerstone in Turkey’s plan to generate power on the Tigris in a US$32bn electricity and irrigation plan in the Kurdish southeast. The project would create a 300 square-kilometre lake with a dam that would destroy 400 square-kilometres of river habitat.
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