Ilisu Dam

HC Deb 15 February 2000 vol 344 cc155-75WH

Motion made, and Question proposed.That the sitting be now adjourned:—[Mr. Robert Ainsworth.]

10 am

Mr. Kevin McNamara (Hull, North)

I am grateful to Madam Speaker for granting me this debate. The Ilisu dam is of considerable interest to many hon. Members, so I shall be as brief as possible to give my colleagues an opportunity to speak in the debate.

I wish first to deal with the Government's often repeated rebuttal of the criticisms of the project, which is that we in the United Kingdom do not have the right to tell Turkey what to do within the confines of its own state. That is true, but the United Kingdom has legitimate concerns at stake. There are serious doubts about the way in which the Turkish authorities have gone about this project, which would be a cause for concern even if the United Kingdom had no direct interest. Secondly, we are discussing United Kingdom taxpayers' money. Those who express concerns about the dam are not trying to tell Turkey what to do. We are asking only that our Government act responsibly. Given all the grave problems involved, the United Kingdom should not support the project.

In recent weeks, the Minister for Trade has advanced two basic arguments about the dam in support of the Government's policy. He claims that there is much misinformation about Ilisu and that critics do not understand that it is a hydropower project rather than an irrigation dam and, as such, will not divert water from downstream states. I assure the Government that I am well aware of that but, as I shall outline in a moment, I still have grave concerns about the potential for manipulation of water flows.

Secondly, the Minister for Trade argued that the dam is the least harmful option and that, otherwise, Turkey would be building fossil fuel plants or nuclear power plants. That is a strange argument, given that Turkey is at present negotiating with Westinghouse about the possibility of a nuclear plant. It raises important questions about the alternatives to Ilisu. That issue has not been addressed by Turkey, by any of the proposed donor countries or by the various reviews that have been carried out. It is fundamental that it is, a point to which I shall return later.

I shall outline what I believe to be the important criticisms of the dam project. First, there are the international implications and the prospect of water wars. The dam is a major installation. It will not affect just one country, but three—Turkey, Iraq and Syria—and it will impact significantly on the water politics of the entire area. We must remember that water is already a focus of conflict in that region—for example, around the Nile and the Jordan. The United Nations has warned us that, in the coming century, water is likely to be a major cause of instability and conflict, and that the next war in the middle east will be fought over water. It is interesting to know that, in the current negotiations over the Golan between Israel and Syria, control over water is an important issue.

I know that the Ilisu dam is an hydro-electric power project, not an irrigation project, and that the dam will not divert any of the water of the Tigris. All the water in the river will continue to flow through the dam and downstream to Iraq and Syria. My concern is the potential for manipulation of the flow of water. The Ilisu dam is an integral part of the 22-dam Guney dogu Anadozu Projesi, the south-east Anatolia development project. There are strong grounds for fearing that Turkey will use the dams to exert pressure on Iraq and Syria, the downstream states, by restricting the flow of water. The spare storage capacity of the Ilisu reservoir alone could block the flow of the Tigris entirely for two or three months, which would put Iraq and Syria under siege.

Despite assurances from the Export Credits Guarantee Department and Balfour Beatty that adequate downstream flows will be maintained, I have been concerned at reports that an official of the Turkish state hydraulics works department, the DSI, has threatened that if, for example, Syria continues to support Kurdish rebels, Turkey will cut off the water. The downstream states are understandably concerned. Syria has protested several times to the United Kingdom about the proposal to use ECGD facilities for the dam, and the League of Arab States protested in writing to the Foreign Office last year.

Turkey has not consulted Iraq over the building of the dam. That is in direct violation of article 5, protocol 1, of a 1946 treaty of friendship and neighbourly relations between the two states, which explicitly requires that Turkey should keep Iraq informed of its plans for construction works on the Tigris and Euphrates rivers.

One of the four essential preconditions for ECGD support for the project that were stated on 21 December 1999 by the Secretary of State for Trade and Industry was that Turkey should give an assurance that adequate downstream water flows will be maintained at all times". However, there is no clear data about existing water flows or how they will be affected by the dam, and the UK requirement is for only "an assurance". Therefore, what means will we have to ensure that the assurance is honoured?

The United Kingdom Defence Forum has warned that the GAP is one of the region's most dangerous water time bombs. The dispute has not erupted yet because the project has not yet reached its full potential. By the time of its planned completion in"— I was about to say 20010, but that would be a long time even for British construction workers— 2010, the vital interests involved give it the potential to become one of the region's most dangerous flash-points". That will have significant implications for western security, as Turkey is a member of the North Atlantic Treaty Organisation and is now beginning the process of accession to the European Union. The project's security implications could extend far beyond Turkey's borders, and could affect our security interests as a member of NATO and Turkey's future in the EU. UK support for the dam, a project about which the neighbouring countries have protested, would therefore be not only unethical, but plainly foolhardy.

The dam has implications in Turkey for the treatment of Kurds. Turkish Government publicity for the GAP says that it will dramatically change the social and cultural make-up of the region". I am sure that that will be the case, and we all understand that that sounds sinister to the Kurds, who make up 95 per cent. of the population of the Ilisu dam area. For many decades, Kurds in Turkey have suffered a systematic and concerted campaign by the Turkish state to wipe out their identity that amounts to ethnic cleansing. The Kurdish language is forbidden. The Turkish Government's record on human rights in south-east Turkey is appalling.

From 1984 until recently, there was civil war between the Kurdish PKK—the Kurdistan Workers party—and the Turkish army. Despite the project's location in what is essentially a war zone, no conflict impact assessment has been made of the Ilisu dam or the GAP. The United Kingdom Defence Forum has highlighted what it calls the profound security implications of the construction of the Ilisu dam. The dam will transform the geography of Turkish Kurdistan", cutting off guerrilla escape routes into the mountains and forcing the rural population out of the countryside, where it may be a support base for the PKK, and into the slums of the cities, where it can be more easily controlled by the Government. The forum concluded: an underlying motive of the project is to deny the Kurdish guerrillas the environment in which they operate. Basically, whether there are guerrillas there or not, that is ethnic cleansing.

The potential clearing of 16,000 people is a recipe for disaster and agitation in not only Turkey, which has an appalling record as regards the treatment of the Kurds, but the surrounding regions and the rest of the Kurdish nation. The Kurds are divided between four states: Syria, Iraq, Turkey and parts of Russia. They have been agitating for self-determination for countless years. Again, that has significance for our security policy. We are entitled to ask what has happened to the ethical dimension of our foreign policy. For the United Kingdom to assist in what amounts to ethnic cleansing is intolerable. The dam is not merely a dam; it has enormous political and cultural implications to which we cannot turn a blind eye.

Hasankeyf is of enormous cultural significance, particularly for the Kurds, and was designated a protected site in 1978. Thousands of years of human settlement and history are there, layer upon layer. Sadly, they are being excavated at a snail's pace. If the city were flooded, it would be lost for ever. The Kurdish community understandably sees the flooding of Hasankeyf as part of a wider strategy to eradicate Kurdish culture. Local people believe that, if it were a historical site in western Turkey, it would not be submerged.

There is still considerable confusion over the number of people who will be affected by the project. The ECGD's stakeholder report says that 16,000 will be displaced and a further 20,000 partly affected. The Kurdish human rights project says that the true figure is higher. Whatever the numbers, many thousands will be affected and at least 16,000 displaced—a polite way of saying that they will be forced to leave their homes and their lands. Yet there has been no consultation between the DSI and local people, and no resettlement plans have been drawn up.

The ECGD's stakeholder report expresses grave concern that the open, consultative and participatory process necessary for resettlement is not part of the Turkish political and institutional culture. The authorities simply do not have the capacity to approach resettlement in that way. They already have a momentous problem trying to rehouse and resettle people after the two recent disastrous earthquakes.

Although Turkey has a legal framework for resettlement that looks good on paper, there have been numerous serious problems in its implementation. Compensation is institutionally inadequate. There is a system for setting payments, but most people take the DSI to court to claim more. Cases can take two or three years to settle in the courts, and inflation is high—running at up to 100 per cent—so that by the time families receive their compensation any increase has been eaten up.

Those who eventually get compensation are the fortunate ones. Many families, in particular the poorest, do not have legal title to their land and, without the documents, they receive no compensation at all. Only 60 per cent. of rural people in the Ilisu area have land registration deeds. Resettlement, even if done appallingly badly, is an expensive business. The cost of Ilisu alone is estimated at $500 million, nearly one third of the total project cost of $1.6 million, and experience shows that it is likely to rise.

Who will benefit from the dam? Balfour Beatty says: Ilisu will bring new wealth and employment prospects to the population of this impoverished area". However, more than two thirds of those who have been resettled after other projects undertaken as part of the GAP now wish to return to their former communities. There are no guarantees that local people will be employed, even in constructing the dam—particularly if they are Kurds—and no stable employment is planned for the area.

Export credit agencies' concerns about resettlement have led them to stipulate that an independent monitoring body must be established, but to what extent could such a body operate independently? The head of Turkey's dam building programme has said that he will not give an independent monitoring team the powers that it would need for effective oversight. All observers of the project so far have been denied access to certain areas and followed everywhere. They have been unable to talk to the local population. How can the project be independently monitored in the prevailing political climate in that part of Turkey?

Balfour Beatty claims that even if the ECGD did not support the project, it would go ahead, and other countries' export credits agencies would pick up the business, and the United Kingdom would lose out. We hear the same argument in relation to arms sales—presumably we must prostitute ourselves, on the basis that, if we do not, somebody else will put his daughter on the streets. Balfour Beatty also claims that the United Kingdom would have no further influence on the project, that not supporting the project would damage UK-Turkey bilateral relations and that the United Kingdom would acquire an international reputation for unreliability and unpredictability in the handling of these matters, with consequent long-term damage not just to Balfour Beatty but to all British-based major project contractors". Balfour Beatty is over-egging the pudding. Evidence given to the Select Committee on Trade and Industry shows that industry is happy with the way in which ECGD works and praises it as innovative. If we innovate by refusing to fund this deeply damaging project, I am sure that it will do us good in the long term, and it will certainly do no harm. In any case, as I have said, there are wider considerations than the needs of just one British firm, important as they are.

Dr. Jenny Tonge (Richmond Park)

My hon. Friend the Member for Carshalton and Wallington (Mr. Brake) asked a parliamentary question about whether details of, and reasons for, Balfour Beatty's application for export credits guarantees could be put in the Library. He was told that that was not correct practice, because of commercial confidentiality. Does the hon. Gentleman agree that we should know what lies behind the application?

Mr. McNamara

I do. I have always found the arguments for commercial confidentiality strange, because they ask us to accept one company's word. In the United States—the biggest and richest capitalist country in the world—commercial confidentiality does not apply to defence contracts, business contracts or anything that involves the Government. It must be part of the secretive nature of the Government—by which I mean any Government of our country, because we are talking about a continuing problem. Of course, my hon. Friends are as open as possible, as we can see from the Freedom of Information Bill. We should have the details, and perhaps the Minister will be able to reply to the hon. Lady.

What are the alternatives to the dam? Ilisu is an expensive project. Independent energy consultants from Turkey and elsewhere have stressed the fact that the same amount of power as that which would be generated by the dam could be saved, at a lower cost, simply by modernising the transmission system, which has a reputation for inefficiency. There is also considerable scope for improving end-use efficiency—the efficiency of appliances and so on. If we want to support Turkey in tackling its energy problem, we would do better to support other means of energy generation. Tackling the demand side—improving energy efficiency—is an obvious first step. If we do not do that, new power stations, whether Ilisu or others, will lose a significant proportion of their power merely through transmission.

In the longer term, we should look to supporting clean generation. I am not an energy expert, but I know that the choice is not merely between fossil fuels, nuclear fuel or big dams. Plenty of other options are available, if only they are taken seriously. The environmental impact of Ilisu might be mitigated by measures such as reducing the height of the dam, but no analysis has been carried out, so we do not know. I should be obliged if my hon. Friend the Minister would assure us that, before a decision is made about ECG support for the dam, all the options will be examined and a report outlining the pros and cons will be made public. It is incredible that a project of such scale has reached the stage that it has with, apparently, no examination of costs and benefits, and no consideration of alternatives. No wonder so many question marks hang over its purpose.

I have spoken for longer than I had intended, and I realise that other hon. Members want to speak. I hope that my hon. Friend the Minister will consider carefully the anxieties expressed this morning, and that my right hon. Friend the Secretary of State will decide that he is not, after all, minded to support the project.

I reiterate my key anxieties about the preconditions for approval. The language that the Department of Trade and Industry uses is deliberately weak. My right hon. Friend the Secretary of State did not even refer to them as conditions, but merely said that granting export credit would be conditional on the Turkish authorities "agreeing to address" anxieties about resettlement, water treatment, downstream water flows and the preservation of Hasankeyf. En passant, we notice that the Government are anxious that they cannot get anything more precise out of the IRA than an agreement to address the anxieties of disarmament. If we demand specificity from the IRA, as we should, we should also demand it from the people involved in the construction of the dam.

Nor has my right hon. Friend the Secretary of State fully faced the problems of resettlement, water treatment, downstream water flows and the preservation of Hasankeyf. What does "agreeing to address" those anxieties mean? The UK Government need to make a clear and unambiguous statement of what guarantees they need from the Turkish authorities before we consider granting support. A clear definition of responsibilities and rights of redress must be provided before allowing the ECGD to proceed, and it should be possible to withdraw support if conditions are not met.

The Ilisu dam cannot be compatible with protecting human rights and the environment in south-east Anatolia. UK support for Ilisu would be incompatible with our commitments to sustainable development and an ethical dimension in foreign policy. We should on no account support the project.

10.23 am

Dr. Jenny Tonge (Richmond Park)

Only two weeks ago in this Chamber, we debated export credit guarantees and arms sales. The Ilisu dam provides yet another example of the questionable use of ECGs by a Government who continue to claim to have a foreign policy with an ethical dimension.

On 20 December last year, I was told in answer to a question on ECGs and the Ilisu dam project that the project has given rise to a number of social, political, environmental and cultural issues requiring further consideration between ECGD, the other export credit agencies involved, the Turkish authorities and the contractors. A decision on the application will not be taken until the issues have been satisfactorily resolved."—[Official Report, House of Commons, 20 December 1999; Vol. 341, c. 380W.] The following day, the Secretary of State told the press that he was minded to grant the ECGD cover of £200 million for Balfour Beatty's participation in the project, and was waiting for reports on several matters, including consultation with and compensation for the local population involved in the settlement programme. Fifty-two villages and 15 towns will be flooded, and 20,000 people will be displaced, the majority of whom are, as we have heard, Kurdish. A plan is being discussed for the preservation of as much as possible of the archaeological heritage of Hasankeyf, including the provison of upstream water treatment plants to ensure water quality and an assurance that downstream flows will be maintained at all times. That is all good stuff, but major concerns remain.

I accept that the project provides much-needed electricity for Turkey. A young Turkish student whom I met in Oxford some weeks ago forcefully explained to me that the project is necessary because Turkey so desperately needs hydro-electric power. I accept that, and publicly acknowledge that that is the case. However, the ECGD has not, in considering the environmental and social impact of the project, applied even the World bank's best international practices. The World bank has refused to have anything to do with the dam, stating that it violates the UN convention, which seeks to prevent border disputes between states that share water resources. In its assessment, the ECGD presumably used the Organisation for Economic Co-operation and Development's guidelines—which are not, in any case, legally binding—as a benchmark. There seems to be some confusion about the guidelines and parameters that are being set.

When the Secretary of State for Trade and Industry gave evidence to the Select Committee on International Development earlier this month, he said this is not an aid-funded project, as was the Pergau dam—another notorious example—but a commercial operation. Surely, however, export credit is a form of aid, and should therefore abide by the same principles as other aid projects. The Secretary of State has admitted that work on drawing up the international procedures that all OECD members will follow remains unfinished. In that case, why is Britain using as yet ill-defined guidelines instead of the recognised World bank guidelines, to which I understand that we are already committed?

We have seen too many cases of multinational malpractice throughout the developing world. It is encouraging that the Government are taking an active part in reaching agreed international procedures on environmental standards, but there must be a European code of conduct for export credit guarantees and incentives, which are consistent with the World bank and the OECD social, environmental and conflict prevention standards. In the case of the four areas of concern about the Ilisu dam that the Government listed, it is essential that there should be binding obligations that the UK can withdraw the guarantees if agreements break down. Assurances are simply not enough. The hon. Member for Hull, North (Mr. McNamara) graphically pointed out the weakness of Britain's commitment in making those guarantees.

Turkey needs access to hydro-electric power. The Ilisu dam is not for irrigation. Turkey currently suffers from an energy deficit, and there are fears that it may use nuclear energy to close the energy gap. If it is to join Europe and grow, Turkey certainly needs energy, but environmental and political concerns cannot be ignored. The dam is only 40 miles from the borders of Iraq and Syria, and could be used to cut off their water supply from the Tigris. Although Balfour Beatty argues otherwise, surely while the reservoir behind the dam is filling, flooding a huge area of land, the water flow of the Tigris will be much less. However it is done, there will be a significant effect on the water that flows along the Tigris.

It is said that tributaries of the Tigris, especially in Iraq, supply more water than comes from the Tigris through Turkey. However, what about times of drought? Although I have not seen the Tigris, I am reliably informed that it is a huge river. It must have some effect on the flow of water into Iraq and Syria, and in future. Turkey could manipulate water supplies to Iraq and Syria. Fears of water wars are not completely misplaced. Furthermore, there is little evidence that Iraq and Syria have been consulted about the matter.

On the issue of human rights, Turkey's record vis-a-vis the Kurdish people is not good. Of the 20,000 people affected, 95 per cent. are Kurdish. I must declare a family interest because my husband lived among Kurdish people in Iraq for a while as a small boy. For 30 years, he has regaled me and my family about the goodness and decency of those people, and about how welcome they made him feel. I have, therefore, always had very warm feelings towards them, because of his advocacy.

Turkey's record on human rights is still a matter for huge concern, and the Kurds rightly feel that the flooding of the ancient town of Hasankeyf is another attack on their cultural identity. In that area, the Kurds are mainly farmers working on agricultural land. Will the Turkish Government ensure that all the Kurdish families on the land that is to be flooded are given equivalent agricultural land, so that they can carry on farming, or will those families become raggle-taggle people living in slums on the borders of the cities in Turkey? The latter outcome is the more likely. How will the United Kingdom Government ensure that the Kurds are properly resettled, and able to benefit from the energy provided by the Ilisu dam and other projects in the area, such as the GAP? Are we to accept Turkey's word on the matter, or will there be continuous monitoring?

My concerns are shared by my right hon. and learned Friend the Member for North-East Fife (Mr. Campbell), who, in September last year, called for a cross-departmental control mechanism for the ECGD to ensure sustainable development and an ethical foreign policy. There have been many recent examples of the DTI and the ECGD appearing to overrule the advice of the Foreign Office and the Department for International Development—investment in Sudan, arms exports to Eritrea and Ethiopia and the sale of Hawk jet parts to Zimbabwe. I could continue, but I shall spare the Minister's blushes.

At the Select Committee for International Development hearing to which I referred earlier, the Secretary of State said: The DTI are not responsible for human rights assessments for areas of export credit. Indeed, the Department of Trade and Industry is not responsible. However, if that job belongs to the Foreign Office and the Department for International Development, why does not the DTI listen to, and act on, their advice? I hope that the Minister will have some answers.

10.33 am

Mr. Malcolm Savidge (Aberdeen, North)

I congratulate my hon. Friend the Member for Hull, North (Mr. McNamara) on initiating the debate. I shall be brief for two reasons. First, both he and the hon. Member for Richmond Park (Dr. Tonge) have covered the issues thoroughly. Secondly, I was somewhat over-exuberant in my cheering when Aberdeen football club managed to get through to a final for the first time in five years, and, as a result, my voice is not at its best.

Why are we raising concerns about the Ilisu dam? It has been suggested that great benefits will be gained from it, such as providing jobs in the area and in the United Kingdom. It has also been suggested that there could be environmental benefits, such as removing the necessity to build a nuclear power station in an area known to experience earthquakes, and that the project could be seen as sympathetic from the point of view of global warming. Certain figures in the stakeholder report might even suggest some public support for the project. Will the Minister tell us how many jobs would be gained in the United Kingdom as a result of support for this project?

The environmental review expresses concern that not nearly enough study has been carried out into the potential damage to flora, fauna and wildlife habitats and states that there has been insufficient analysis of alternative ways in which to produce and conserve energy—a matter with which my hon. Friend the Member for Hull, North dealt thoroughly.

The hon. Member for Richmond Park dealt with cultural questions. Grave concerns have been expressed about the archaeological heritage, and not merely in the city of Hasankeyf. I defer to the hon. Member for Richmond Park on the precise pronunciation of that. Of course, much of the surrounding region is unexcavated, particularly the cave areas, and a rich archaelogical heritage could be permanently lost.

As my hon. Friend the Member for Hull, North said, according to Government briefings, a dam built primarily for hydro-electricity, rather than irrigation, should not substantially affect downstream water flows. However, am I right in saying that the building of a previous Turkish dam affected water flows even though Turkey promised its neighbours that it would not? Moreover, is not Turkey still in dispute on that with Syria, which has taken it to the International Court? Is not it also true that the Turkish contractor for the Ilisu project was reported on a BBC Radio 5 Live programme as saying that downstream water flows will be reduced by 45 per cent. for at least the first three years.

The stakeholder report highlights a possible cumulative effect, particularly in the light of a proposed further dam, which would be used for irrigation. Again, my hon. Friend the Member for Hull, North mentioned the problem of water control and spoke in detail on diplomatic relations in the region. I recently visited most of the front-line states that are involved in the middle east peace process, and grave concerns were expressed about the possible effect of such projects on that process. Access to water is an important issue in discussions between Syria and Israel on the Golan heights. Many people look to Britain to support a process for which there is cautious optimism. Given the current desperate shortage of water, it would be particularly unfortunate if we were to have a deleterious effect on those delicate negotiations.

At least 16,000 and perhaps as many as 25,000 Kurds will be compulsorily moved, and a further 20,000 may be affected, although the stakeholder report makes it clear that it is difficult to be precise. Under Turkish law, compensation would be offered, but the report also makes it clear that the history of compensation in relation to Turkish dam projects is not encouraging. Many people claim to have received no compensation, and often compensation has been too little, too late. In Turkey, where inflation can run at 100 per cent. per annum, too late automatically becomes too little.

The stakeholder report refers to the damage done to social structures. Balfour Beatty has made extravagant promises on consultation but, according to the report, there has been no attempt at consultation. It has been said that the project has been under consideration for some 20 years but, in fact, it has been under consideration for 50 years. Not a single person was found first to have heard of the project from the companies involved.

Proper consultation has not taken place. There is virtual martial law, and the stakeholder report states that security conditions make it difficult to obtain proper access. The reporter had limited time and was unable to visit many areas because of security difficulties. The report states, with fairness, that the figures about support should be treated with considerable caution. The translator in the Kurdish areas was a Turkish Government official. How freely would people speak in that situation? It has been suggested that the area will benefit from additional electricity, but it is alleged that most of the electricity that is produced by the existing dam projects is used not in the Kurdish areas but elsewhere in Turkey.

The Government should be careful not to repeat the situation that arose in relation to the Pergau dam under the previous Government. My hon. Friend the Member for Hull, North mentioned that this dam—I need to be careful about how I use that word—project is called the GAP. I shall not try to pronounce the Turkish that the acronym stands for, but I fear that the word "gap" is appropriate in this context. There may be a gap between the airy reassurances that we have received and what appears to be the grim reality on the ground. I fear that, if the Government are strongly minded to approve this project there could too easily be a gap between reassurances that we might receive on human rights, environmental, cultural and diplomatic matters, and what really happens.

I am not given to Joan of Arc experiences—I do not often hear voices—but when I was coming to the Palace on the tube this morning, I heard loud and clear a warning that I hope the Government will heed: "Mind the gap."

10.41 pm

Mrs. Angela Browning (Tiverton and Honiton)

I congratulate the hon. Member for Hull, North (Mr. McNamara) on raising the subject. The speeches of Labour and Liberal Democrat Members make it clear why the project is a matter of concern.

On 21 December last year, the Secretary of State for Trade and Industry issued a press release outlining his approach to the matter. That happened to be the day that the House rose for the Christmas recess, and the Department of Trade and Industry slipped out several press releases in the full knowledge that Members of Parliament would be packing up to go home and so would pay them less attention than if they had been released in the middle of the week when the House was sitting. That is a somewhat cynical approach to this important matter.

In the press release, the Secretary of State referred to The two reports: one examining the resettlement issues and the other looking at the environmental impact", and he explained that they were commissioned to help Ministers decide whether to grant export credit backing to the scheme. He continued:

I have carefully considered both reports and I am minded to grant export credit. I have read both reports, but it puzzles me that the Secretary of State came to that conclusion. The report on resettlement is a weightier document than that on the environment, but there is little in either report that would lead one to think, "Yes, let's go with those proposals," not least because the project is not new—it has been around for 20 years—although, interestingly, the Ilisu dam already features on Turkish tourist maps. I applaud such commitment, but placing the scheme on a map does not answer the many questions that hon. Members have raised today. I agree with some of the concerns that have been raised.

In giving his judgment on those two documents, the Secretary of State added four caveats—things that needed to be done before he could proceed. If the Government are to go ahead with ECGD money, it would be helpful if the Minister could give us some detail about the action that is being taken and what is being put in place, to ensure that the criteria are not only met but are monitored and enforced. To recap, the four caveats were, first, the need to draw up a resettlement programme which reflects internationally accepted practice and includes independent monitoring". We all accept that that is a laudable aim, but what will be done in practice to ensure that that is done? The second was, to make provision for upstream water treatment plants capable of ensuring that water quality is maintained". There is a great concern in the environmental paper about water quality. the third was to give an assurance that adequate downstream water flows will be maintained at all times". I understand that since the environmental report was produced more work has been done on that issue. Perhaps the Minister will update us on the solutions that have been found to that problem.

The fourth caveat was the need to preserve archaeological sites. I notice that the press release includes the words "as possible", which is a bit of a cop-out. We all want to preserve such sites, but can the project go ahead even if it is not possible to preserve them? Will the Minister clarify what is meant by that statement?

We have heard from other hon. Members about the impact on neighbouring countries, and I want to emphasise the huge political row and instability that could be caused in the region if the scheme proceeds without due consultation with neighbouring countries, particularly Iraq and Syria, and if the views of the Arab League, which has made official representations on this matter, are not taken into account. It is not clear from the Government's press releases or the documents that they have put into the public domain how they intend to respond to complaints from third parties. Certain lobbying groups—for example, Friends of the Earth—have issued press releases saying that the Government could be taken to court if they proceed with the scheme. Presumably the Government have taken legal advice on their position.

That brings me back to a point that was made earlier concerning the international legal basis on which the Government will now proceed. We have heard about the involvement of the World bank. I understand that it was approached as early as 1984 when it turned the project down. When I look at the parameters and conditions that have applied since 1984, my instinct tells me that the World bank is less likely to say yes in 2000. Presumably the Government have taken advice on their position in relation to other international bodies, which clearly would have a view on the scheme.

We seek more information from the Minister today. Much of what one reads in the newspapers is comments by Ministers and commentary on them, but I have the clear impression that the scheme is being driven personally by the Prime Minister. There appears to be a huge row between the Foreign Office and No. 10. One wonders what pivotal role the Department of Trade and Industry plays in all this, but as the Secretary of State for Trade and Industry is "minded" to proceed, one assumes that he is on the side of No. 10. Clearly the scheme flies in the face of the Foreign Office's stated ethical foreign policy, not only for all the reasons that hon. Members have so ably demonstrated, but particularly because of the question of the Kurdish population, which must be addressed.

This is a big issue for thousands of people. Any big civil engineering project such as this anywhere in the world, even in our own country, would cause a great deal of concern to those living in the immediate vicinity. As Members of Parliament, we all know what happens. In the past seven years my constituency has faced the prospect of a new town, a gas-fired power station and a quarry. When such matters arise, all those who are immediately affected lobby against them. It is right that they should raise their voices, but the issue that we are considering is of enormous humanitarian concern. As the hon. Member for Richmond Park (Dr. Tonge) rightly said, the population in the vicinity of the proposed dam has not been consulted. Nothing in the report assumes any preparation or consultation on how the community would be rehoused and remain as a community. Is the failure to address the resettlement issue the result of a formula to disperse the community to the fringes of many cities, as the hon. Lady said? If that is not the case, work needs to be done rapidly, and assurances given.

Dr. Tonge

Does the hon. Lady agree that in other countries and contexts that might be referred to as ethnic cleansing?

Mrs. Browning

Indeed. There is great concern about the way in which Kurdish communities have been treated in the past. We are therefore cautious about the possibility of dispersing a community.

Other hon. Members have ably outlined the problems, but I want to add a further point. If the Prime Minister is the driving force behind the proposal, he is in a strong position to ensure that, if the dam proceeds and is supported by the UK taxpayer, the criteria outlined by the Secretary of State for Trade and Industry on 21 December are met. He has a strong card to play. Turkey wishes to become a member of the European Union, and the Prime Minister will have many opportunities to influence that decision and the speed with which it happens. As a negotiator, he should ensure that, if Turkey's membership of the EU proceeds, the conditions for ECGD funding outlined by the Secretary of State are met. That does not need to be done in a bullying way; it is purely a matter of straightforward international common-sense negotiation.

Mr. McNamara

I asked the Prime Minister whether the matter had been raised at the Helsinki summit, when the Kurds were invited to attend. He said that it had not; nor had it been raised in side meetings or with European Union officials. I agree with the hon. Lady that the matter should be addressed.

Is the hon. Lady aware that Balfour Beatty is part of a consortium currently being prosecuted for bribery in relation to a dam project in Lesotho? Should the ECGD be funding the company in those circumstances?

Mrs. Browning

I do not know the background to the legal affairs of Balfour Beatty. I would expect that to be explored by the appropriate agencies, to ensure, if that is the case, that it is exposed. I am aware, however, that it is not just a Balfour Beatty UK project; an international consortium is involved. Many other countries, including European countries, are involved in the project.

I hope that the Minister will be able to give us the answers and assurances that we seek. In particular, I hope that she will shed some light on from where, within the Government, the driving force is coming. If it is No. 10, I hope that she will assure us that the Prime Minister will use his high office to ensure that our concerns about resettlement, environment and the effects on neighbouring countries are addressed. Resolution and enforcement will be necessary if the project is to proceed.

10.54 am

The Minister for Small Business and E-Commerce (Ms Patricia Hewitt)

I congratulate my hon. Friend the Member for Hull, North (Mr. McNamara) on securing a debate on a matter that is of great concern to him and to the other hon. Members who have spoken. I fully understand those concerns because the Government share them.

I begin by reminding the House in some detail of the statement that my right hon. Friend the Secretary of State made shortly before Christmas when he published the two reports commissioned by the Government—one on the resettlement issue and the other on a review of the larger environmental impact assessement which had been commissioned on behalf of the Swiss contractors. In that statement my right hon. Friend said: I have carefully considered both reports and I am minded to grant export credit. This will be conditional on the Turkish authorities agreeing to address the concerns we have about the environmental and social impact of the project. He went on to say that copies of both reports have been given to representatives of the Turkish Government and the other Government export credit agencies considering support for the project, and that the Government are discussing with them the details of the areas in which changes would be required and action taken before the Government could consider export credit support. They include the need to draw up a resettlement programme that reflects internationally agreed practice and includes independent monitoring; to make provision for upstream water treatment plants capable of ensuring that water quality is maintained; to give an assurance that adequate downstream water flows will be maintained at all times; and to produce a detailed plan to preserve as much of the archaeological heritage of Hasankeyf as possible. The matters of concern that were raised by my hon. Friend and other hon. Members this morning reflect the concerns that my right hon. Friend raised with the publication of the two reports just before Christmas.

Underlying the debate is the question of whether the British Government and, in particular, the Export Credits Guarantee Department, should remain engaged in discussions about the project or should pull out completely. The reality is that Turkey is in any case likely to proceed with the dam, using Turkish companies or contractors from other countries. As the hon. Member for Tiverton and Honiton (Mrs. Browning) made clear, for the past 20 years the Turkish authorities have been planning on the assumption that they intend to proceed with the dam, which, as she said, is noted on their maps. By remaining engaged with that process we can try to ensure that international standards are met and that if and when the dam is built it has a high standard of construction, which is particularly important in a country that has suffered two major earthquakes in recent years, to tragic effect.

The hon. Lady also rightly said that Turkey is a candidate for accession to the European Union, that candidate status was confirmed by the Helsinki Council last December. Like every other candidate for EU membership, Turkey has to meet the EU's political membership criteria on democracy, the rule of law, human rights and the treatment of minorities before accession negotiations can begin. All those issues are directly relevant to the concerns that the Government and other hon. Members share about the Ilisu dam project.

However, it is also worth remembering—I am glad that the hon. Member for Richmond Park (Dr. Tonge) stressed the point—that the dam project offers the possibility of major economic benefits for Turkey. Turkey's economy is growing rapidly and, as a potential member of the EU, can be expected to continue to do so. It already has an energy deficit of 5 per cent. and has to import to meet its current energy needs. Moreover, its per capita energy consumption is only 15 per cent. of the OECD, making it clear that, whatever other measures it takes to promote energy efficiency and, thereby, hold down the growth in demand for energy, it will have to increase energy supply.

Hydro-electric power is a clean and renewable source of energy. It would help Turkey to continue to diversify its sources of power. It clearly would help to reduce reliance on imported energy and it would reduce the likelihood of Turkey deciding to build a nuclear power plant to meet some of its energy needs. Again, given the recent earthquakes, there is particular concern about any prospect of nuclear power plant construction in Turkey.

It is also worth saying that, if Balfour Beatty becomes one of the contractors for the Ilisu dam, it will bring to the project high-quality and highly experienced British construction. I remind hon. Members of the recently completed British-constructed Izmit water project. It withstood last year's earthquake, despite the fact that it was extremely close to the epicentre of the quake. There are real advantages in our engaging with Turkey in developing the plans for the project before a decision is made about whether to offer an export guarantee.

Dr. Tonge

Is the Minister truly satisfied with Balfour Beatty's record? We have heard already that Lesotho is prosecuting for corruption the project contractors in that country, of which Balfour Beatty was one. I understand, too, that BICC—Balfour Beatty's parent company—has been barred by Singapore from bidding for Government contacts for five years, following bribery. Is the hon. Lady entirely satisfied that we can rely on the company to do the right thing on the Ilisu dam project? Do the Government have any plans to take on the company under the OECD guidelines and ensure that it does not do the same again?

Ms Hewitt

The consortium of which Balfour Beatty is a member has been accused of corruption in relation to the Lesotho highlands water project. Balfour Beatty vigorously denies any such wrongdoing and I am sure that, like me, the hon. Member for Richmond Park believes that one is innocent until proven guilty. The case is expected to begin in the South African courts in the summer and we shall see what emerges. We do not intend to put current applications on hold until a verdict is reached in that case.

Mr. Savidge

I am concerned that, with the suggestion of the alternative being a nuclear power station in an area of earthquakes, we might be guilty of precisely what the report criticises in its reference to the way in which the Turkish Government have dealt with the matter. It seems to have introduced oil-fired power stations with a view to making them a paper tiger to knock down. The report suggests other possibilities that have never been considered seriously.

Ms Hewitt

My hon. Friend makes an important point. Clearly, it is up to the Turkish Government to decide on an energy strategy by which to examine the comparative risks, costs and benefits of the Ilisu project, and so on. The update of an environmental impact assessment report may deal with those issues, but, as we and all developing countries know, with economic growth tends to come an increase in the demand for energy. Given that Turkey's per capita energy consumption is a small portion of the OECD average, it seems sensible to assume that the Turkish Government are right to anticipate a need for a significant increase in energy supply if they are to enjoy the benefits of economic growth and those that will be delivered to their population through that growth.

There are only so many possibilities for any Government to consider about meeting significant increases in demand for energy, one of which is clearly nuclear power plants. To follow a course of action that might increase the likelihood of a nuclear power plant being built in a country that has recently suffered two major earthquakes is not necessarily sensible or in the interests of its people.

The hon. Members for Richmond Park and for Tiverton and Honiton raised the roles of different Departments. The hon. Member for Tiverton and Honiton became rather overexcited about a conspiracy that she appeared to see within the Government.

Mrs. Browning

I certainly was not accusing the Government of conspiracy in this instance, although I might in others. I was more concerned that there seems to be a difference of opinion between Departments.

Ms Hewitt

I am happy to reassure the hon. Lady about that as well. The Department of Trade and Industry works extremely closely on the matter with several other Departments, such as the Department for International Development, the Department of the Environment, Transport and the Regions and, especially, the Foreign Office. There is a range of interests, and the DTI leads on the support of exports. Issues of sustainable development, human rights, the treatment of minorities and so on are not the preserve of any single Department. DFID has given us extremely helpful advice, especially by putting us in touch with Dr. Morvaridi, who carried out the analysis on resettlement that we published in a report shortly before Christmas. I must stress that Turkey is not one of DFID's key partner countries, and the project is not one of aid. DFID's involvement has declined since the commission of the report.

Dr. Tonge

The Minister must accept that DFID is interested in and does a tremendous amount of work on conflict prevention. Time and again, it seems to those of us who are not party to Government thinking that its advice is overruled by other Departments and by No. 10 Downing street, as the hon. Member for Tiverton and Honiton suggested. We are concerned that commercial interests are always put before the promised ethical foreign policy.

Ms Hewitt

There is no question of DFID being overruled. It has assisted us in properly analysing resettlement, which is a major human rights issue relating to conflict settlement. We have been able to tell the Turkish Government that we think that a great deal more needs to be done if an effective resettlement programme is to be carried out. Turkey is not one of DFID's key partner countries, so it is appropriate that the DTI should use its role as the sponsoring Department for the ECGD to promote human rights issues and environmental and sustainable development issues within the context of what is a commercial project.

The DETR maintains an interest in sustainable development, as do the ECGD and the Foreign Office. The Foreign Office is especially interested in the human rights issues as well as relations with Turkey and other states in the region. My Department and the ECGD have worked extremely constructively with those Departments, and will continue to do so as the process continues until a decision is made. The DTI is in the lead because the request is for commercial support through the ECGD.

My hon. Friend the Member for Aberdeen, North (Mr. Savidge) asked whether the project would have an impact on the middle east peace process, but such anxieties are not well founded. The project will have a minimal impact on Syria and no effect on the other front-line states. It is on such issues that we work closely with the Foreign Office.

Mr. McNamara

My hon. Friend passed lightly over the major anxiety about water flows. She did not deal with the dam's possible impact on Syria and Iraq, or with the general comments of the United Kingdom Defence Forum. Will she go into more detail, rather than merely repeating what we have already read?

Ms Hewitt

I shall discuss those issues in a moment, but I want to deal with the issue that my hon. Friend the Member for Aberdeen, North raised about the middle east peace process. Of course I shall discuss in some detail both upstream and downstream water flows.

The hon. Member for Tiverton and Honiton referred to the World bank—

Mr. Savidge

I visited Syria and spoke to its Foreign Secretary, who has considerable influence in the regime. He expressed grave concern at the dam's possible effect on water supplies to Syria. What consultations have been entered into with Syria, now that we are trying to encourage better relations with it in moving the middle east peace process forward?

Ms Hewitt

My hon. Friend should ask that question of a Foreign Office Minister involved in detailed discussions with the Syrian Government. My understanding is that, precisely because the dam is a hydro-electric project, rather than an irrigation project, it will not have a major impact on the water supply to Syria. I shall return to that issue in a moment.

One of the reasons for ECGD engagement in the process is to influence for the better the enivronmental impact of water projects. In introducing the debate, my hon. Friend the Member for Hull, North elaborated well on the broad context of water projects and the genuine danger of serious conflict over an apparently or genuinely scarce resource. ECGD has been able to deliver positive action to influence the environmental impact of several recent power projects, including the Shandong in China, the Sual in the Philippines, the Manjung in Malaysia, and the Vizag in India. In all those cases, rather than putting commercial interests above environmental and other interests, as the hon. Member for Richmond Park implied, we used commercial leverage to achieve environmental goals. I hope that my hon. Friends support that. In this case, we are doing that through the pressure that we and other export credit agencies are bringing to bear in discussions with the Turkish authorities.

Several hon. Members referred to the reduction in water flow that will occur while the dam fills up, as distinct from what will happen once the dam is full and the hydro-electricity project starts. The DSI, which bought, or commissioned, the dam, has discussed the problem with engineers for the United States agency Eximbank, the United States' equivalent of our ECGD. We are waiting for confirmation of the minimum flow agreed to be maintained while the dam fills up, after which we shall be able to judge whether what has been agreed will be adequate to maintain the downstream flow into other countries. We are continuing to discuss the rights of neighbouring states, and it is for the Foreign Office to take the lead. The real responsibility lies with Turkey to communicate its proposals to neighbouring states and to reassure them that the project will not have an adverse impact on the downstream flow. As it is not an irrigation project, that should not be a problem once the dam is fully operational. As I said, we have yet to receive the information that Eximbank will obtain on the level of flow to be maintained while the dam is being filled up. However, half the flow of the Tigris joins the river below the dam and below the Turkish border, so by no means all the flow of the river will be affected by the construction of the dam.

Dr. Tonge

One has only to look at the map, as I did carefully last night, to see that the tributaries of the Tigris, which come from Syria and Iraq, are a long way from the sources of the Tigris. It is conceivable that a drought in either of those areas could lead to minimal flows of those tributaries and the people would be dependent on the flows from the Tigris. That puts Turkey in a prime position to influence and, if necessary, wage a water war against those two countries.

Ms Hewitt

Those concerns are being addressed, but again I stress that, if it were an irrigation project, there would be a risk of inadequate water flows into Syria and Iraq. However, a hydro-electric project such as this depends on a continuous flow of water, not on stopping and diverting the water in the way that an irrigation project would.

Mrs. Browning

The environmental document states: Some of the potential downstream impacts, eg reduction in floodplain fertility for agriculture, channel erosion, loss of downstream riverine fisheries, are largely discounted since it is assumed that Cizre Dam will be constructed and a reservoir environment created downstream. We have not heard much about that second adjunct, on which the dam now appears to be conditional. Is that going ahead?

Ms Hewitt

A major point in the environmental report was that other scenarios had not been properly addressed in the environmental impact assessement. That main environmental impact assessment, which has been commissioned by the Swiss, is now being updated. We hope that it will take account of the criticisms expressed in the report that we commissioned, which we published before Christmas. Clearly, we need to understand, as do the Turkish Government, the implications of building the second dam and what would happen to water flows and other environmental issues in either of those scenarios.

Upstream issues also arise. The water treatment plants that will be constructed in the main towns must be operational before the dam starts to fill, because the environmental impact assessment has made it clear that, otherwise, there is a risk of pollution in the reservoir. It is a serious issue and it is being addressed.

The other serious issue is the resettlement of villagers whose land would be flooded as a result of construction of the dam. Here again we are working closely with the Foreign Office. A full resettlement plan must be drawn up, taking account of the people's wishes. In other words, we need a process that involves their participation, with proper support provided to all those affected. It is clear from Mr. Morvaridi's excellent report that we are taking those issues seriously, and we expect the Turkish authorities to respond equally seriously.

Mr. Jeremy Corbyn: (Islington, North)

I apologise for not having been here earlier, Mr. Deputy Speaker. I had a previous engagement.

I fully accept that the British Government are concerned about the treatment of people displaced by the dam, but Turkey's record on displacing people from the Kurdish region is nothing short of abominable and apalling. Given the way in which those people have been treated by the army and civil authorities, does the Minister have any reason to believe that the situation will be different if the construction of the dam goes ahead?

Ms Hewitt

Real concerns exist about Turkey's human rights record, and those, among other issues, must be addressed if Turkey is to succeed in its desire to become a member of the European Union. However, there are signs of progress. The Turkish authorities have appointed independent local consultants who have carried out assessments for the World bank in respect of other projects, and have agreed to the appointment of an international expert. Furthermore, progress is being made on the consultation exercise and the survey. The Turkish authorities are taking the matter seriously as a result of the international pressure that we have helped to bring to bear.

Dr. Tonge

Will the Minister then explain why the World bank refuses to support the project?

Ms Hewitt

I am grateful to the hon. Lady for restating that point, because I should have dealt with it earlier. The World bank has not been asked to support the project. Discussions took place between the Turkish Government and the World bank, but the bank said that those discussions did not constitute a request for support. We have discussed the project with the World bank, and have not received any indication of the kind of opinion to which the hon. Lady referred.

Several hon Members referred to the archaeological and cultural heritage of Hasankeyf. That has been the subject of research by the Middle East technical university, and a presentation that was given in Ankara a couple of weeks ago—of which we are awaiting full details—will give us a better idea of how much can be preserved and what can be catalogued. However, it is worth pointing out that much of that archaeological heritage is not in good condition, and several experts have expressed the view that, if the dam were not to be built, much of it would continue to decline and disappear.

My hon. Friend the Member for Hull, North and other hon. Members asked whether, if export credit guarantees are to be granted in this case—the decision has not yet been made—it would be possible to enforce any conditions in relation to the contract. The ECGD enters into agreements with the exporter and the bank that determine the terms on which support is made available, and is also involved in the negotiation of the loan agreement between the bank and the borrower. It is normal for such loans to include undertakings by the borrower which, if they are not observed, may lead to the suspension of the continued availability of the loan. If we were to give cover, and conditions attached to that cover were not fulfilled, we would be able to pursue diplomatic and legal forms of redress. The time for detailed consideration of any such conditions would follow the Secretary of State's decision as to whether to proceed. That will not happen for some time, because we have not yet received the full updated environmental assessment report.

I assure hon. Members that, if support were to be offered, it would be possible to consider making requirements under the terms of the loan agreement that certain events shall have occurred, or that the Turkish authorities shall have carried out certain acts, before the agreement becomes effective. It would be possible to require undertakings by the authorities that they will carry out certain acts in certain ways, and to provide that if the undertakings were to be breached, the whole amount of the outstanding loan would become immediately payable and there would be no further advances to the contractor under the loan.

Similarly, under the construction contract, the contractor should be able to cease work in the event of a breach of undertakings by the Turkish authorities. The ECGD contract with the contractor could include a provision whereby, in the event of a breach of undertakings by the Turkish authorities, the ECGD would have the right to direct the contractor to cease work.

I hope that I have made it clear that the Government share the concerns that hon. Members have expressed—my hon. Friend the Member for Hull, North did so eloquently—and that we are using our influence through the ECGD to reach more satisfactory outcomes in relation to the environment, interstate relationships and questions relating to human rights and resettlement. We expect a decision about support to be taken some time in the summer, by which time we will have considered the updated environmental impact assessment report and had responses to our other concerns. We and the export credit agencies that are involved will take account of the need to establish a resettlement action plan that reflects international practice and ensure that it is put into effect properly.

I am grateful to my hon. Friend for giving us an opportunity to debate this important issue. If my right hon. Friend the Secretary of State decides, after consideration, to grant export credit cover, a statement will be made to the House, which will provide a further opportunity for debate and questioning.

Mr. Deputy Speaker (Mr. Nicholas Winterton)

The right hon. Member for South-West Norfolk (Mrs. Shepard) and the Minister are present in the Chamber, so although we are a little ahead of our timetable we may start the next debate.