CENN — Daily Digest – 06/28/2004

CENN – June 28, 2004 Daily Digest
Table of Contents:
Major BTC story: BP, its pipeline, and an environmental timebomb
Campaigners urge halt to BP “environmental timebomb” -Whistleblowers expose
Turkey pipeline
BTC Co. Representatives Visit Borjomi Portion of Baku-Tbilisi-Ceyhan
The government seizes yet another green area
Areni First National Wine Festival
Armenian premier, German foreign minister discuss economic ties
Extracting value
Oxfam International’s Response to World Bank’s Management Recommendations on
the Extractive Industries Review
First Ever Fair of Non-Timber Forest Products to Take Place in Moscow Later
This Year
A Special Capacity-Building Seminar on Management of NGO’s

1. Major BTC story: BP, its pipeline, and an environmental

Please find below two related articles about the BTC pipeline from
Saturday’s edition of the UK’s “Independent” newspaper.

Exposed: BP, its pipeline, and an environmental timebomb


By Philip Thornton, Economics Correspondent

26 June 2004

The safety of a controversial oil pipeline being built by one of Britain’s
largest companies has been jeopardized by cost cutting, incompetence and
shoddy workmanship by contractors, whistleblowers have reported.

Former senior workers have revealed a catalogue of failures they say could
lead to a major oil leak that would devastate one of the world’s most
environmentally sensitive areas. A dossier including their evidence, seen by
The Independent, indicates BP’s contractors and sub-contractors are cutting
corners to get the job completed on time.

The whistleblowers, qualified professionals, say BP made a major mistake in
handing control of the section of the 1,000-mile pipeline through Turkey to
a government-owned company, Botas, on a fixed-price contract. The full line
runs from the Caspian Sea to the Turkish Mediterranean port of Ceyhan.

The project ran into opposition from civil rights and environmental groups
when BTC, the 11-member consortium led by BP, sought funding from public
bodies such as the World Bank and the UK’s Export Credit Guarantee
Department (ECGD). Opponents said the pipeline, which would be driven
through some of the world’s most earthquake-prone and conflict-ridden areas,
would wreak environmental, social and economic havoc. A spokesman for the
ECGD said the department believed it had made a full assessment of the
project before it decided to support it.

The whistleblowers’ statements, which will be given to the MPs next month,
say that:

a. builders cut off villages’ water supplies, flooded farmland and
allowed oil leaks;
b. there were insufficient checks for the risk of the pipe buckling
in earthquake zones;
c. crucial welding work often failed inspections;
d. those who complained were sacked or made to leave;
e. workers handled toxic coating materials without proper health and
safety equipment.

Dennis Adams, a senior engineer who quit after six weeks after not being
paid, said the contractors’ work was disorganized and mismanaged. Pipes were
left exposed for longer than specifications allowed and trenches were filled
with materials that might allow uncontrolled movement of the pipes. “Safety
violations were occurring at all times, including workers in deep
unprotected and unstable areas,” he said.

“I don’t have much hope for the future integrity or proper maintenance and
operation of a pipeline of this size and importance being primarily
sponsored by one of the largest petroleum companies in the world. It is
quite obvious that [BP] are not in control of the Turkish section of this

Another manager, who asked not to be named, said he was removed from his job
after he raised concerns over the way the project was being managed. “I have
over 20 years’ pipeline experience and this project is unique. It’s a
complete mess-up. No one wants this on their CV. It’s an embarrassment.”

Documents were not properly kept and problems with inspections and the
quality of the work being done were covered up. “Everything is done badly,”
he said. “I believe at this stage that quality issues – health, safety,
environment – will be substantially affected.”

Colynn Burrell, an American with 35 years’ experience, said he was dismissed
after 10 weeks working at the Ceyhan terminal for highlighting major design
problems. He complained about a problem with the drainage system that meant
toxins flowed straight into the ground. “I insisted on getting the
subcontractor to seal the perforations at the bottom of the pipe to create a
channel. The manager said it was expensive.” Mr Burrell said he was told at
one point that all pipe welding was being failed by inspectors; the normal
failure rate was 6 per cent.

Mike Morley, a Briton who was sacked as a weld-coatings inspector, said
“numerous” welds had to be redone; many others had been laid before
inspection. Even when inspections did take place, the results were not
filed. The House of Commons Trade and Industry Committee has started an
inquiry into the decision by the department to use taxpayers’ money to
underwrite loans of $150m (£83m). Martin O’Neill, Committee chairman, said
he would look at all allegations “without prejudice”. The ECGD has
commissioned a new report into the pipeline, which is expected next month.

A spokesman for BP said last night: “We, along with Botas, will continue
look at any serious allegations and if they are valid make sure they are put
right.” He said Botas had pledged to maintain the highest health, safety,
environment, labour and human rights standards and good international
practices. “Botas has an obligation and BTC [the consortium] expects that
Botas’s construction techniques and testing regimes will ensure the pipeline
will be laid safely and that it will operate safely in accordance with those
standards,” he said.

“Inevitably with construction projects of this size there are challenges,
but BTC will continue to work with our partner to resolve them.”

Hidden costs of pipeline meant to safeguard West’s oil supply


By Philip Thornton, Economics Correspondent

26 June 2004

Where there’s oil, there’s trouble – and never has that been truer than
today amid fears of a price surge that could pitch the world’s economy back
into recession.

More than a decade ago the West, and particularly the United States,
realized that it needed to guarantee oil supplies well into the next century
in an increasingly war-torn world.

And that was before Osama bin Laden threatened to take control of Saudi
Arabia, the world’s largest producer, and oil-rich Russia’s government
embarked on a plan to take control of its vast reserves.

The answer was to cut out those two tinderbox regions by building a pipeline
that would bring crude from the Caspian Sea to the Mediterranean coast and
the safe hands of fellow Nato member Turkey.

Azerbaijan and Kazakhstan, two former Soviet states that border the Caspian,
between them have oil reserves three times the size of America’s. The
challenge was to find a secure way of getting the oil into the petrol tanks
of gas-guzzling SUVs before oil shortages and soaring prices pushed the
price of gas on America’s forecourts to sky-high levels.

By 2010 the Caspian region could produce 3.7 million barrels per day. This
could fill a large hole in world supplies as world oil demand is expected to
grow from 76 million a day in 2000 to 118.9 million by 2020. By this time
the Middle Eastern members of Opec would be looking to supply half of that

The answer was to drive a 1,090-mile, 42-inch wide pipe – the world’s
longest export pipeline – along a 500-metre-wide corridor from the Caspian
Sea port of Baku in Azerbaijan to Ceyhan in Turkey via some of the world’s
most unstable and conflict-ridden nations. When it is complete next year,
the pipeline will pump 4.2 million barrels a year, easing the US’s reliance
on the unstable Gulf States for oil.

The project will cost up to $4bn (£2.4bn) and is being built by BTC, a
consortium of 11 companies led by BP. Almost three quarters of the funding
will come in the form of bank loans, including $600m from public bodies such
as the World Bank.

In the face of opposition from British pressure groups such as Friends of
the Earth and civil rights groups such as the Kurdish Human Rights Project,
BP set up an independent group, the Caspian Development Advisory Panel
(CDAP). The panel, which included people such as Jan Leschly, a former head
of SmithKline Beecham, and the former US Treasury under-secretary Stuart
Eisenstat, raised concerns about the project at the end of last year. In
their report they said they were worried whether Botas, the company awarded
the contract to build the Turkish section, would meet its social,
environmental and health and safety commitments given its “weak but evolving
environmental and social compliance culture.

“The panel heard concerns that Botas and its contractors might feel pressure
to cut corners on environmental, social and technical standards to remain on

It added: “The panel encourages BP… to use all its leverage, including
stoppage of work, if necessary, to ensure Botas fulfils its commitments.”
But CDAP’s concerns went wider, offering detailed advice on how to better
protect human rights given that Azerbaijan, Georgia and Turkey have all
recently seen “internal or external conflict”.

“The poor human rights record of host governments’ security and military
forces create a significant reputational risk for BP and BTC,” it said.

Objectors say the impact goes even wider. They say the threat is twofold –
what happens if the pipeline goes wrong, and the destruction it would wreak
even if it goes right. They say that the project will worsen the already
polluted Caspian Sea, where sturgeon numbers are reckoned to be collapsing.
In Georgia, the project will clear areas in two dense primary forests, cross
the buffer zone of a protected natural park, and could badly affect several
rare and endangered species.

In Turkey there are more than 500 endemic plant species within the corridor,
while a third of the country’s globally threatened vertebrates are found
within 250 metres of the corridor.

The route crosses two sites protected under national legislation, including
a wildlife protection area for the Caucasian grouse, a threatened species.
There are two critically endangered plant species and 15 bird species with
nesting pairs numbering 500 or less within the corridor.

Campaigners say legal agreements make BP the effective governing power over
the corridor, over-riding all environmental, social, human rights or other
laws, present and future, for the next 40 years. Amnesty International says
the consortium concluded an unprecedented agreement with the Turkish
government which, it claims, would in effect strip local people and workers
of their civil rights. And that’s if the project goes to plan.

If the project were to go wrong, for instance if an earthquake broke the
pipe or the project fell into the hands of terrorists, the consequences
would be far more serious. Turkey lies in an earthquake zone, with 17 major
shocks in the past 80 years. Since the Baku line will be in place for some
40 years, there is a high chance of a major earthquake during its operation.

The World Bank, the European Bank for Reconstruction and Development,
Britain’s Export Credit Guarantee Department and the World Bank’s
International Finance Company all carried out extensive assessments of the
project before they decided to lend or underwrite money.

The four whistleblowers that contacted The Independent all said the way the
pipeline was being built failed all international standards. This included
incorrect materials being supplied, work being started before the land had
been surveyed, and the pipe installed before it had been inspected.

Greg Muttitt, of the campaign group Platform, said: “Environment groups have
raised concerns about the design of this pipeline for the past two years.
What we are seeing now though is that the problems are far worse than we had
imagined. This is a deeply flawed project. Now the banks, which ignored the
warnings and financed the project regardless, have some serious questions to

2. Campaigners urge halt to BP “environmental
timebomb” -Whistleblowers expose Turkey pipeline

Friends of the Earth
Kurdish Human Rights Project
The Corner House
The Baku Ceyhan Campaign

Saturday 26th June 2004

Environment and human rights groups have called for suspension of
construction on major BP oil pipeline, following new evidence published in
today’s Independent of major technical failures on the project.

Four senior pipeline experts who worked on the Baku-Tbilisi-Ceyhan (BTC)
pipeline in Turkey have revealed a catalogue of incompetence, cost-cutting
and shoddy workmanship, which raises major questions about the safety of the

All four have successful careers of over 20 years in pipeline construction,
and have said this is the worst project they have ever worked on. Their
revelations include:

o not hiring proper specialists to advise on engineering, including
on crossing seismic faults in the earthquake-prone region;
o using inappropriate materials and construction methods, which will
not perform the function they are needed for;
o not following construction design specifications and procedures;
o failing to carry out checks or keep records on construction
o using staff without proper training or qualifications;
o ignoring environmental or health and safety requirements;
o causing bankruptcy of local business suppliers along the route.

Two of the experts were sacked for raising concerns about the problems.

The Baku Ceyhan Campaign has talked to all four whistleblowers, and is now
calling for an urgent halt to construction activities until the problems are
resolved. The findings run counter to repeat BP promises that this would be
an environmentally and socially beneficial project.

Hannah Griffiths, Friends of the Earth, commented, “BP and financial
institutions have ignored the warnings on this pipeline. Now the extent of
company failings and consequent environmental risk have come to light, work
on the project must be stopped until these issues are sorted out.”

Kerim Yildiz, Executive Director of the Kurdish Human Rights Project, added,
“Villagers we have interviewed have consistently told us they were not
properly consulted, nor informed of the risks of this pipeline. These new
findings show the risks are even greater than we had feared”.

Greg Muttitt, of PLATFORM, said, “BP has tried to create a reputation as
being better than other oil companies. But, thanks to the professional
integrity of these four and other experts, we now hear about the shocking
reality. It is to their credit that they have taken personal risk to inform
the public of these serious issues.”

Anders Lustgarten, of the Baku Ceyhan Campaign, added, “We have already
heard of faulty weld coatings being used in the Azerbaijan and Georgia
sections of this pipeline, which BP has tried to claim were one-offs which
are now rectified. This new dossier shows that in fact the whole pipeline is

Nicholas Hildyard, of the Corner House, commented, “We know the banks are
already concerned about the risk their reputations from this project. BP has
told them all is in order. It isn’t, and the banks should now undertake
their own investigation.”

For more information
Hannah Griffiths, Friends of the Earth: 07855 841 994
Greg Muttitt, PLATFORM: 07970 589 611

Dear Colleagues

As you know, companies investing in developing countries often do not have
to meet any meaningful environmental or social standards, as national law is
weak and no binding international standards apply to investment.
Increasingly, however, because of civil society pressure public and private
financial institutions are requiring some minimum environmental and social
standards for projects they support. As a result, although we may not have
the global standards for international investment we want, environmental and
social standards set by the World Bank Group are increasingly the ‘de-facto’
global standard for international finance.

The International Finance Corporate (IFC), the private sector lending arm of
the World Bank Group, has become the leading environmental and social
standard-setter for international project finance. Not only is the IFC an
important global financier in its own right, but IFC standards are
increasingly being accepted by both public and private financial
institutions. For example, twenty-five commercial banks that are involved
in over 80% of all internationally financed projects have agreed to follow
IFC environmental and social standards. Many export credit agencies also
benchmark their environmental guidelines to IFC standards.

Starting in July, IFC will begin a process to update and revise these
environmental and social policies, as well as over 70 technical pollution
standards. The policies will address a range of issues from human rights
and labor, to community involvement and benefits policies, to biodiversity
and climate change. They will determine if any areas in the world should
not be touched by investment or are too environmentally vulnerable that they
should be avoided altogether, as well as determine if affected communities
and indigenous peoples have the right to say no to development in their
area. The pollution standards will also set international benchmarks for
emissions of toxic pollutants such as lead, mercury and others in a variety
of industrial sectors.

The IFC process provides a critical opportunity for civil society groups to
push for *more rights, rules and responsibilities* in the international
investment system.

Below/attached is a global sign on letter to the IFC as they begin this
process, to put on record some key issues that civil society groups expect
them to address.

The deadline for endorsement is Friday, July 2, 2004. To endorse the
letter, send an email to: [email protected]
<mailto:[email protected]> with your name, organization and country.


Andrea Durbin and David Hunter


July 2, 2004

Mr. Peter Woicke
Executive Vice President
International Finance Corporation
2121 Pennsylvania Avenue NW
Washington, DC 20433

Dear Mr. Woicke,

We welcome the upcoming review process and opportunity to strengthen the IFC
‘s safeguard and disclosure policies as well as the Pollution Prevention and
Abatement Standards. We hope that the process will be participatory, and
that the concerns and priorities of civil society around the world will be
fully considered.

You have said this process will not lead to the weakening or erosion of any
of these policies and standards. We appreciate your commitment. It is
important that these policies are not only strengthened, but that the IFC
uses this process to position itself at the forefront of defining what is
_expected and required_ from its project sponsors in terms of socially and
environmentally responsible corporate practice.

As you know, the global business climate has changed significantly in the
last ten years. Companies are increasingly obliged to address social and
environmental protection issues, ensure community benefits, and respect
labor and human rights. In this changing business environment, companies
seek clarity and consistency in the rules they are expected to meet. The
appropriate role for IFC in this changed business environment is to help in
clarifying the rules for those companies operating in borrowing countries.

As a leading development institution, however, the IFC has additional
responsibilities to deliver upon its development and poverty alleviation
mandate. Therefore, we urge you to use this process to clearly identify IFC
‘s responsibilities in the development process as well as identifying the
responsibility of the company borrowers. In this way, IFC can lead by
example, establishing enhanced standards for itself and its clients and
encouraging private companies to do the same.

Although we are heartened by IFC’s stated commitment to taking a
principles-based approach to sustainability issues, we are concerned that
this may signal a move away from clearly defined rules, rights and
responsibilities. Both a principles-based approach and clear rules are
necessary to ensure that IFC-supported projects are conducted in a
participatory, transparent and socially and environmentally sustainable

There are many issues of importance to civil society in borrowing countries
that we would like to highlight here. We hope that these issues are
addressed fully in the upcoming review process.

1. The review process should result in a new rights-based approach
to development-an approach that recognizes and protects human rights, labor
rights, the rights of indigenous peoples and women’s rights as well as
community-based rights to be fully informed and offer consent to development
projects and to benefit directly from, and be an equal partner in, the
monitoring and oversight of projects. These rights should set the framework
for all of the IFC’s safeguard policies and requirements of its clients.

2. The review process should address global environmental and
sustainability issues, including IFC’s role in protecting biodiversity-rich
areas and ecologically important and threatened areas. It should also
address IFC’s role to avert the threats of global climate change by helping
to reduce global carbon emissions. Further, the process should address and
protect areas important to indigenous peoples and sacred lands from unwanted

3. The review process should develop and apply a set of criteria or
indicators of good corporate behavior for all potential project sponsors.
As noted by the CAO’s own review of the safeguard policies, proven prior
commitment to social and environmental standards is the most crucial factor
in implementation of safeguard policies and achieving positive development
outcomes. The IFC should partner with companies that are committed to
social and environmental protections; applying a set of criteria in advance
will help identify the most appropriate partners.

4. The review process should result in a requirement that all
projects clearly and publicly articulate the development objectives in
advance of final approvals, and evaluate each project based on those same

5. The review process should result in an integrated assessment
process required for all projects with significant impact on any of these
issues. An integrated assessment would address environment and social
issues, including labor, gender, and human rights issues, health impacts and
poverty reduction issues.

6. The review process should address the application of these
standards and policies to Financial Intermediaries (FIs), some of the
fastest growing lending of IFC. Not only should all IFC standards and
policies be equally applied to all FI loans, this process should also
address how IFC oversees and ensures compliance.

7. The review process should result in a clear process through which
the presumption in favor of disclosure can be effectively implemented.

We not only expect IFC to identify how it will release information upon
public request but also to clearly specify the documents and types of
information that the IFC will routinely disclose or require to be disclosed.
Again, whereas sound principles are vital to securing the best transparency
standards for IFC and its clients, specific rules are also needed. Full
transparency and disclosure is paramount.

We look forward to IFC’s upcoming proposals for addressing these issues and
to participating in this process.


Natalia Ablova, Bureau on Human Rights and Rule of Law in Kyrgyzstan
Bruce Jenkins, Bank Information Center, U.S
Manana Kochdazde, CEE Bankwatch Network, Georgia
Cristian Opaso, Grupo por el BioBio (GABB) – Chile
Graham Saul, Friends of the Earth-Canada
Heffa Schucking, Urgewald, Germany
Jon Sohn, Friends of the Earth US
Mustafa Talpur, Action Aid – Pakistan


Source: Sarke, June 25, 2004

On June 24, 2004 representatives of Board of Directors of BTC Co.,
Baku-Tbilisi-Ceyhan Pipeline Company, visited the Borjomi gorge. The
construction of the oil pipeline will shortly be launched on this
ecologically complicated region.

4. The government seizes yet another green area

Source: , June 22, 2004

Yerevan, Armenia — “I stood here for two days from sunrise to sunset to
prevent them from destroying my land. They promised that they wouldn’t, but
they destroyed it at night when I went home. I came the next morning and saw
that my green garden had been bulldozed. I almost had a heart attack,” says
Anik Ohanyan, who lives at # 14 David Anhaght Street.

“Overnight, they crushed twelve years of hard work with a bulldozer. They
didn’t give us any warning, they never even told us, ‘Those are your trees;
take them away from here,” complains another resident of the building,
Knarik Ohanyan.

The green area between D. Anhaght and K. Ulnetsi Streets is to be used to
build a “Canadian district” and a military academy. It used to be woods,
planted in the 1940s. Yerevantsis used to call this area Mko’s Woods, for
the forest watchman who had vigilantly protected the trees. In 1992 and 1993
during the energy crisis in Armenia, people from the nearby buildings
chopped down part of the forest. In subsequent years, about a hundred
families from the neighborhood took the initiative to divide the territory
into 800-1000-square-meter plots, and began to cultivate them. For most of
these families, this was all they had to live on.

“They’ve driven these families to the garbage dumps, and now they have to
dig in the garbage. They are pensioners; what else can they do? During those
years when there was no light, when people were cutting the trees down, this
place was turning into a garbage dump. But we divided it into plots and made
it green again. Was it a bad thing to plant trees? And now we learn that
this territory has been given to somebody else, and our gardens are being
destroyed,” says sixty-year-old Vazgen Arakelyan.

The land was given away through several decisions by the mayor and the
government. When they learned of this, neighborhood residents appealed to
the mayor’s office to privatize their plots, but they were turned down,
since the Canadian district is expected to bring in major investments.

“The mayor is responsible for land allocations in Yerevan. Our district not
only didn’t participate in the allocation of these lands, but also didn’t
learn about it until eight months after the fact, from unofficial sources.
But we are required to implement government decisions,” Ghazar Ghazaryan,
the head of the architecture department of the Kanaker-Zeytoun district
mayor’s office, says.

The area residents these plots belong to have applied to the district mayor,
the Yerevan mayor, the real estate cadastre, the police, the prosecutor’s
office, and the president’s supervision service, emphasizing that not only
is ten years of their work being ruthlessly destroyed, but an “ecological
disaster” is also taking place in this area.

“We have applied to all possible addressees, but the replies we have
received are one more ignorant and uninformed than the other. It is
pointless to go anywhere else. The court would be a waste of time, too,
because it’s obvious that the laws don’t work in this country,” says Rafayel
Ohanyan, who lives at # 30 Ulnetsi Street.

“The total area is about twenty-five hectares. The Canadian district will
occupy nine hectares, the military academy two hectares. But I’ve heard that
the rest of the land has been sold off as well,” Ghazar Ghazaryan says.

In a 2002 government decision, 4.5 hectares of land were given for 50 years,
without any tender, to HRAAA Ltd., to build a Canadian district at the
company’s own expense.

Article 76, Paragraph 5 of the Land Code of Armenia gives the government the
right to make such an allocation: “The cases of land allocation for lease
without a tender shall be defined by the government.” But the Land Code
doesn’t define which cases these are.

The mayor of Yerevan and the foreign minister of Armenia interceded with the
government to make the decision it did. We haven’t yet been able to find out
who the real owners of HRAAA Ltd. are. The founder of the company is Arthur
Ketikyan. Clearly, there must be some reason why the government allocated
the land the way it did, with no tender.

In a 2000 decision by then-Mayor Robert Nazaryan, 4.3 hectares of this land
was sold “at auction”, for apartment houses and hotels. But local residents
were never informed of the auction, and none of them had the chance to bid
on their own land.

“We don’t want to privatize this land to build houses, we want the green
area that used to be woods to be preserved, and the trees to grow,” they

5. Areni First National Wine Festival
Tufenkian Hospitality
21/1 Tumanian St.,

Yerevan Armenia 375001
Contact: Lilit Hakobyan
Tel: 374 1 520 911
Fax: 374 1 520 913
E-mail: [email protected]

Second Saturday of October (2004 10 09)
Vayots Dzor region, Areni Village,


USDA and Tufenkian Hospitality are glad to announce the first national wine
festival in Armenia, with the aim to introduce an ancient Armenian tradition
of winemaking to the World.

More than just a showcase for great wine, the festival is a major event for
traditional food making and tasting, traditional crafts-making, and
folkloric performances.

The event program includes traditional dancing, singing, tight-rope
performances, a Marionette Theatre, food-making and tasting, wine-making and
tasting, traditional games, contests, art work, carpet weaving, and craft
items: their creation and presentation (materials used include stone, wood,
and local ceramics).

Villagers will sell home-made products, in their houses – yogurt (matsun)
and cream, honey, nuts and walnuts, vegetables, fruits, dried fruits, baked
goods, lavash, home-made jams and jellies, sweet sujukh, herbal teas
(including hip-rose & thyme), and all the other products that a typical
Armenian household usually prepares for its members.

Armenian companies will present such products as wine, cheese, dried fruits,
meat and fish products, and soft drinks.

Craftsmen will present their work, and visitors may try their hand at
replicating this art.

Armenian restaurants and cafes will organize an area for a one-day operation
of their businesses.

Children can draw in a nearby meadow.

At the Information Desk, visitors can learn about the history and historical
monuments of the region, including Gladzor Museum, the Selim Pass and
Caravanserai, and Noravanq Monastery. Find out more about the local climate,
the flora and fauna of the region, and the village itself. The Djermuk Spa
will also be present.

A qualified trilingual guide will take visitors to the local church for a
tour. This will be done according to a set schedule throughout the day.

For more information please contact us at
374 1 520 911, 105 ext., or
e-mail: [email protected]

6. Armenian premier, German foreign minister discuss economic

Source: Arminfo, June 24, 2004

The fact that the South Caucasus countries have been included in the Wider
Europe: New Neighborhood programme is very important for Europe, German
Foreign Minister Joschka Fischer said today at a meeting with Armenian Prime
Minister Andranik Markaryan who is currently paying a working visit to

The press service of the Armenian government has told Arminfo news agency
that the German minister noted the possibility of developing and
implementing projects within the framework of the participation of the South
Caucasus countries in the programme.

Commenting on the situation in the South Caucasus at the German minister’s
request, Markaryan said that certain preconditions set forth by Turkey and
Azerbaijan hinder the establishment of effective regional cooperation.

Noting expanding Armenian-German economic cooperation and experience gained
in this sphere, Markaryan stressed that it was necessary to further boost
joint economic programmes and direct German investment in the Armenian

7. Extracting value

Source: Financial Times, June 22, 2004

The World Bank’s governing board will shortly have to decide whether oil,
gas and mining industries in poor countries do more harm than good. The
bank’s independent Extractive Industries Review says it should pull out of
oil and mining. The bank’s management, predictably, disagrees. But it needs
to do more to make its case that such industries can be made to work
effectively and durably for the poor.

The conduct of the review itself was unimpressive. The idea of placing
ultimate power in the hands of an “eminent person” – in this case Emil
Salim, former Indonesian environment minister under the dictatorial
President Suharto – is flawed. It encourages damaging battles for that
person’s ear rather than constructive consensus among different views. Mr.
Salim’s habit of making sweeping criticisms of the bank well beyond his
brief hurt the credibility of his conclusions.

But those conclusions, that the bank pull out of oil and mining altogether,
deserve to be taken seriously. As a broad spread of non-governmental
organisations – not just the usual anti-bank suspects – argued, quite aside
from the environmental considerations, it is hard to show that extractives
have systematically helped relieve poverty in countries that do not already
have somewhat successful economies and the rule of law.

It is difficult to find an example, perhaps with the exception of
diamond-rich Botswana, of a country that has levered itself out of dire
poverty principally using oil, gas or mining. More often, extractive
industries distort the political as well as the economic life of poor
nations, encouraging the growth of a predatory elite fighting over revenues
rather than the healthy competition of a diversified market economy. It is
hard to look at corruption-racked countries such as Nigeria without
concluding they might be better off never having discovered oil.

The World Bank needs to be cautious in getting involved. While projects in
relatively well-run economies that would go ahead anyway are improved by its
environmental and governance rules, it should be very careful about
corruption-riddled countries where its involvement is the tipping factor
making the project viable.

The bank argues that it can make projects in such countries worthwhile by
imposing environmental safeguards and constructing transparent mechanisms
for sharing revenues broadly in the country. But its capacity to do this is
still being tested in high-profile projects such as the Chad-Cameroon oil
pipeline, about which respectable critics such as the anti-corruption
campaign Transparency International continue to harbor reservations.

On balance, for the bank to pull out of oil entirely at this stage looks
like an overreaction. Blanket sector-wide bans are in any case clumsy
instruments. But it must do better to show that its involvement can make a
real difference if it is to justify a continued role in this most
controversial area.


Source: EIR-NOW!, June 24, 2004

“Overall the World Bank’s response to the Extractive Industries review is
very disappointing and raises serious questions as to whether the Bank can
ever change”, said Jeremy Hobbs, Oxfam International’s Executive Director.

“Oxfam strongly urges the Board of the World Bank to accept the
recommendation to only support projects that have the broad acceptance of
affected communities.

However we want to see more explicit detail about how this would be carried
out in practice.”

The Bank’s resistance to pulling out of investing in extractive projects in
conflict zones is not acceptable and we urge them to reconsider.

Its failure to follow the recommendation to phase out of coal and oil
projects was widely expected and completely inadequate.”

9. First Ever Fair of Non-Timber Forest Products to Take
Place in Moscow Later This Year

Source: IUCN June 25, 2004

IUCN Office for Russia and the Commonwealth of Independent States, in
collaboration with an array of local and international partners, is
organizing the first ever fair of non-timber forest products (NTFP) in
Moscow’s most prestigious exhibition centre in October this year. Non-timber
forest products – such as berries, mushrooms, and herbal medicines – are
among the most important forest resources for local communities around the
world, even though the actual ‘products’ may vary from place to place.
Interest in these products has grown enormously in recent years, and NTFPs
are increasingly viewed as a key part of local sustainable livelihood
strategies. However, better information on marketing opportunities,
equipment and technologies and sustainable harvesting practices is needed to
ensure the sector’s sustainability. IUCN has been working with local
communities in Far-Eastern Russia on developing sustainable NTFP-related
businesses since 1998, and the NTPF fair is expected to boost similar
initiatives across the country and beyond.

10. A Special Capacity-Building Seminar on Management of NGO’s




A Special Capacity-Building Seminar on Management of NGO’s


July 15 – 26, 2004


In recent years the number and scope of non-governmental organizations,
responsible for health, education, the economy and the environment, has
greatly increased. They are highly influential in communities, at the
grass-roots level, in the planning and implementation of social and economic
policy. Increasingly, NGOs mediate the relationship between the private and
public sectors and facilitate private sector investment in community
development and the environment. Therefore, effective leadership and
creative management of NGO’s are crucial to gain advantage in the
competition for the limited resources available to the public sector.

Program Description
The program addresses the current role of NGOs in community development and
challenges NGO leaders in their efforts to build their organizations. It
provides participants with a learning environment that promotes and
encourages the exchange of ideas and experiences and builds international
links among NGO leaders.

Program Participants
The program is designed for NGO directors, supervisors, senior managers and

The main objectives of the program are as follows:

To present the role of NGOs in community development
To increase the effectiveness of NGO leadership and management including
financial management
To improve the managerial functioning of NGOs as well as Fund Raising
To enhance the relationship between NGOs and communities, governments and
the private sector
To provide opportunity for international dialogue and exchange of ideas
among NGO professionals


Part A – Management of NGO’s – Principles
The Development and Importance of the Third Sector
Project Management: Concept and Development
Project Evaluation
Financial Analysis of NGO’s and Its Implications
Methods and Tools for Social Assessment
Essence and Uniqueness of NGO Leadership
Human Resource Development and Management
Fund Raising Strategies

Part B — Advanced Management and Leadership
Communication Skills
Advanced Management Workshop
Project Management: Timing and Budgeting
Motivation in Non Profit Organizations
Implementing Change
Challenges of Democratic Leadership
Empowering Future Leadership
NGOs in Israel

Course Methodology
The program is based on experiential and participatory activities. Lectures
will be supplemented by study tours, case study analyses, small group
discussions, and games and simulations facilitated by the College faculty
and guest lecturers.

International Training Program – Galillee College, Israel



Minimum requirements:
– First degree from university – B.A, B.Sc (Or to have vast Working
experience in the field of NGO’s)
– Must be proficient in English.
– Hold citizenship from the country of residence.
– Work in subject relating to the course

Program of Study: The duration of the course is 13 days and is comprised of
100 study hours. The daily schedule consists of approximately 8 hours a day
(10 academic study hours), five days a week, including appropriate study
tours. Upon successful completion of course, participants will be issued a
certificate. Each participant will be assigned a project, which is to be
completed and submitted within six months after the course. Once the
projects have been reviewed and approved by our Academic Committee, the
participant will receive a Diploma for the program.

Tuition: EUR1900. Candidates who meet the application requirements will
qualify for a full Tuition Scholarship that covers all tuition expenses.

Local Expense Fee: EUR2,450. Candidates (or sponsor/organization) are to
cover the Local Expense Fee. The fee includes: accommodation (two people per
room), full board, airport transfers, study tours, study materials, medical
insurance, weekend excursions (visits to historical, archeological and
religious sites in Israel).

* Please note: airfare and pocket money are NOT covered by this fee.

To apply, please send the following by fax or email:

Registration form
Visa application
Sponsorship Endorsement form

It is possible to register via our website: or
contact our office by email or fax to request for forms and register.

Mr. Mark Street
International Department email: [email protected]
International Department
Galillee College, P.O.B. 1070 Tivon
ISRAEL 36000
Tel. 972-4-9837444
Fax. 972-4-9830227

Caucasus Environmental NGO Network (CENN)

Tel: ++995 32 92 39 46
Fax: ++995 32 92 39 47
E-mail: [email protected]


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