Press Release

The UK company, Global Coal Management (GCM) has suffered a severe blow following the Asian Development Bank’s (ADB) decision to drop its financial backing for the controversial proposal to build an open cast coal mine in Phulbari, North West Bangladesh.

Tim Jones, policy officer at the World Development Movement, which spearheaded the UK campaign to stop the Phulbari mine project going ahead said:

“It is absolutely right that the ADB have pulled out of this project. The consequences of the scheme on the environment and the people living in the area would have been disastrous. The people of Bangladesh should not suffer at the hands of a British company. This is a blow for GCM but a victory for some of the poorest people of Bangladesh.”

The ADB was planning to grant a US$100 million loan to the project, as well as a US$200 million political risk guarantee. But the Bank came under fire from a range of NGOs, activists and individuals who claimed that the mine would lead to political unrest, reduced access to food and water for more than 100,000 people and the displacement of at least 50,000 people with minimal compensation.

Professor Anu Mohammed from Bangladesh said:

“The area around Phulbari is extremely fertile and densely populated. It is also one of the few regions in Bangladesh that are safe from flooding and other natural catastrophes and therefore plays a key role for the food security of the entire country. The proposed ‘development’ project is merely a scheme to loot natural resources from a poor country for the rich. We will not allow Global Coal Management to turn a land of food for the people into a black hole for corporate profit.”

Forty-two community leaders from Phulbari wrote to the Asian Development Bank in December 2007 asking them to pull out of the mining project, saying: “The ADB offers loans in the name of reducing poverty, but if realised, we believe that this project will increase the poverty of the local population as well as cause environmental disaster.”

Over 60 international NGOs, such as Oxfam Australia, ActionAid Pakistan, Greenpeace India, also wrote to the Asian Development Bank setting out the social, environmental and political risks of going forward with the loan.

Notes to editors

• More than 50,000 people, including the local indigenous community, will be displaced in a country increasingly short of land. GCM claim they will compensate the legal holders of the land, but the majority of people living in the region are landless farmers, who will receive minimal compensation and for only two years. GCM have not said how they expect people to earn a living once the land they work on has gone. Bangladesh is one of the most populated countries in the world.
• Campaigners fear that food and water security will be compromised by the mine, due to an increase in the levels of toxins, including arsenic, in the water supply, which could also affect agricultural land. The mine will also reduce access to water in the area which is likely to affect a further 100,000 people.
• Three people were killed during protests in August 2006, when over 20,000 people demonstrated against the mine. Campaigners are concerned that if GCM does not pull out of Bangladesh there will be further unrest.
• Financing the mine would have contradicted the ADB’s own energy policy, which states that coal mines should only be supported if the coal is for use in the local area, but most of the coal would have been exported from Bangladesh.

To find out more about the World Development Movement’s action for Phulbari, please see www.wdm.org.uk/bangaldeshmine