Fitzsimons Jeanette: International Finance Agreements Amendment Bill — First Reading 
Fitzsimons Jeanette: International Finance Agreements Amendment Bill — First Reading 
[Volume:639;Page:9094] 
JEANETTE FITZSIMONS (Co-Leader—Green) 
: 
 This is one of those bills where Parliament passes legislation in order to give effect in domestic law to treaties that the executive has already signed with other countries so we can be seen as a bit of a comma after the full stop in that sense. Normally these bills go through Parliament with no controversy. But as it happens the Greens are not going to vote for this bill and I want to explain why we are not. 
I agree strongly with all the causes that Marian Hobbs has just espoused in her speech: international aid enabling developing countries to improve their quality of life health infrastructure and all the rest of it and even that foreign investment is necessary in order for them to do that. But let us look at the track record of the Multilateral Investment Guarantee Agency and see what it has actually done in the past. The agency exists to protect foreign investors from the risks associated with investing in developing countries. So we put up capital along with other countries to cover the insurance for those corporations. It seems they do not have to buy their own insurance; it seems we buy it for them. It costs us around $9 million to belong to the agency. This is not the only agency of the World Bank that provides that kind of guarantee and insurance policy so it is not as though there are no other ways that cover can be provided. 
Let us look at this particular agency and see what it has done in the past. Well it has a set of guidelines for the projects where it will guarantee investment and it is supposed to cover things such as human rights the environmental record and social issues. But a recent investigation by the compliance adviser ombudsman of the agency’s parent body the World Bank strongly criticised the agency for projects where it had guaranteed the investor but been completely negligent about checking on human rights issues on the environmental record and on the social effects on the host community. I do not think that our aid money should be going to support an organisation that performs as badly as that. 
Let me give members an example. The agency insured investment in a copper and silver mining project in Katanga in the Democratic Republic of the Congo. The audit concluded that the risks to the local communities in terms of the human rights impact of the project were not adequately considered. The mining company that the agency insured apparently provided logistical support to the Congolese army during a violent counter-offensive to suppress a small-scale uprising and according to the United Nations as many as 100 civilians were killed during that military offensive supported by the multinational company. The World Bank investigated that. There does not seem to have been any process whereby the agency investigated the effects of the investment projects that it was insuring and guaranteeing and it seems that they were negative in terms of human rights and negative in terms of the life and safety of the local people and their social well-being. 
Another project the pulp mill at Fray Bentos in Uruguay was insured and guaranteed by the agency. That mill made pulp out of eucalypt chip It was strongly opposed by the local community because of the concern that it would seriously pollute their river. The bank also found that the agency had neglected to investigate the environmental human rights and social impacts of that project. 
So here is an organisation that simply doles out our money to foreign investment companies to guarantee them against the local risks of investing in countries where they make a lot of money and it cannot even be bothered to investigate whether the projects that it is supporting will be good for the local community. The investigation of that agency was not carried out by a radical Third World monitoring organisation but by an official of the World Bank who found that the agency was not living up to its responsibilities and was not taking due care or doing due diligence on projects. It was just there to facilitate investment regardless of whether that would be good for the local community. 
I have been a strong supporter for raising New Zealand’s official development assistance. I think we have a responsibility to countries that are developing to help them more than we currently do. We are way down on the international league table in terms of the proportion of our GDP—about 0.27 percent—that we devote to official development assistance and we have signed up really to the international agreement that it ought to get to 0.7 percent. Well we are not getting there very fast; we certainly will not get there in my lifetime. But if our aid is to include guaranteeing multinational investors against local events in the communities where they invest and if they invest in projects that are damaging to human rights to the environment and to the local society I do not think that is an appropriate use of our money. 
The Greens will therefore be voting against this bill. We do not expect that that will prevent it from passing but we think it is time that somebody stood up and told the truth about what the agency does.