A big white scar runs across the lush landscape of northern Armenia’s Lori province. A road spirals round the sides of a giant hole in the mountainside — the opencast Teghut copper mine. Factory buildings stand out against the skyline; inside are huge machines stamped ‘FLSmidth’, the name of a Danish engineering firm.
With the support of the Danish export credit agency EKF (Eksport Kredit Fonden), FLSmidth contributed significantly to the development of the mine, which opened in December 2014. PensionDanmark, a pension fund, also invested 350m kroner ($53.8m) in the project.(Ore deposits in the area were then estimated at 1.6m tonnes of copper and 100,000 tonnes of molybdenum.)
What I hear from locals is that there is a slimy material in the water, so when they irrigate their crops a layer of dust or mud sticks to them
Claus Primdal Sørensen
A clever arrangement connected EKF and PensionDanmark with FLSmidth, Russian bank VTB (Vneshtorgbank) and Armenian mining company Vallex. It allowed the pension savings and taxes of Danes to fund a venture with disastrous consequences for the environment and health. EKF is part of the Danish industry, business and financial affairs ministry, and works closely with the foreign ministry, helping Danish companies to guarantee their investments abroad at low cost. With the backing of this state guarantee, PensionDanmark agreed to finance Vallex’s project on condition that the 350m kroner be used to purchase equipment from FLSmidth, in which the fund held shares worth 45m kroner ($6.9m) in 2014. Under the loan agreement, Vallex’s bank VTB was to pay PensionDanmark back after 10 years. (EKF’s website states, ‘EKF benefits not only the companies we help, but the Danish economy as a whole.’)
According to its website, EKF makes every effort to respect the ‘main international principles and standards’ on corporate social responsibility, especially the OECD (…)
Full article: 1 896 words.
(1) Arbejderen, Copenhagen, weekend edition, 18-20 August 2017.
(2) Author of Human Rights, Export Credits and Development Cooperation: Accountability for Bilateral Agencies, Edward Elgar Publishing, Cheltenham, 2018.
(3) Armenians have been able to petition the ECHR since their country joined the Council of Europe on 25 January 2001.
(4) Arbejderen, weekend edition, 25-27 August 2017.
(7) Peter Liakhov and Knar Khudoyan, ‘How citizens battling a controversial gold mining project are testing Armenia’s new democracy’, openDemocracy, 7 August 2018.