Environment group calls to suspend funding of Ethiopia’s dam

May 7, 2009 (ADDIS ABABA) — An international environmental group urged the African Development Bank (AfDB) to reconsider their commitment to fund the ongoing construction of a dam in southwest Ethiopia saying it would affect the ecosystems and livelihoods in the region.

The Gibe III Dam, located 190 miles (300 km) southwest of Addis Ababa, on the Omo River, is Ethiopia’s largest investment project. The project costs $1.7 billion.

In order to diversify and develop its economy, the government of Ethiopia has initiated an aggressive plan to develop hydropower for export, long seen as one of the country’s few exploitable resources. Foreign aid covers 90% of Ethiopia’s national budget.

International Rivers urged the AfDB to not fund the construction of Gibe III saying it will reduce food security of up to half a million poor farmers, herders and fishers in southwest Ethiopia and northern Kenya.

“An oasis of biodiversity in a harsh desert, Lake Turkana supports 300,000 people and rich animal life. Hundreds of thousands of fishing families and pastoralists will be affected if the lake’s fragile ecosystem is stressed to the brink of collapse.”

“The project would spread war and famine in a region that is already affected by climate change,” further said International Rivers.

Next week from May 13-14 the AfDB directors will discuss during a meeting to be held in Dakar, Senegal, the funding of Gibe III which is under construction since 2006. The African bank agreed to contribute to finance the project but it has to determine how much it would pay.

European Investment Bank is considering financing Gibe III, up to € 250 million, while Italy is mulling financing Gibe III with up to € 250 million.

In complaints filled to the AfDB, Kenyan NGOs and International Rivers assert that the project violates five binding AfDB policies.

Construction of the Gibe 3 Project began in July 2006 with flagrant violations of Ethiopia’s laws on environmental protection and procurement, said the environment advocacy group.

It also alleged that the contract was awarded without competitive bidding to Italian construction giant Salini, raising serious questions about the project’s integrity.

The nongovernmental group said the AfDB should suspend its plans to fund this project until a thorough review and consultations with all affected peoples have taken place.

“The AfDB should in the meantime help Ethiopia drought-proof its energy sector, diversify its energy mix, and tap its abundant renewable energy resources.”

(ST)