DFAIT response Re: Three Gorges - March 17, 2003

March 17, 2003

Mr. Fraser Reilly-King and Co-signatories
NGO Working Group on the EDC
Halifax Initiative
104-153 Chapel Street
Ottawa, Ontario

Dear Mr. Reilly-King and Co-signatories:

Thank you for your e-mail and letters of January 17, 2003, with which you enclosed a copy of the report entitled Human Rights Dammed Off at Three Gorges, concerning the Three Gorges Hydroelectric Project in China. I am also replying on behalf of my colleague the Minister for International Trade, the Honourable Pierre S. Pettigrew.

We have taken note of the allegations in your report and will continue to monitor developments. In its human rights dialogue with China, Canada works to promote improved governance and democratic development. We raise concerns about the human rights situation with the Chinese leadership at every available opportunity.

We understand that China has an urgent need to protect millions of people from recurring floods and to provide a sustainable source of power for China's growing economy. The involvement of Export Development Canada (EDC) in financing the Three Gorges Project is minor. Two loans were provided in 1996 and 1997 in support of the sale of equipment and services by Canadian suppliers. At the time of the loans, EDC satisfied its own procedures by reviewing environmental information that was available. EDC's Environmental Review Directive, which took effect in December 2001, establishes processes for conducting reviews of the possible environmental impacts, including potential social impacts, of projects under consideration for financing or insurance. The Environmental Review Directive also identifies international good practices against which EDC will benchmark projects to determine whether they are acceptable from the perspective of potential environmental and related social impacts.

I hope that this information is useful to you and thank you again for writing.


The Honourable Bill Graham P C , Q C, M P
Minister of Foreign Affairs

c.c. The Honourable Pierre S. Pettigrew, P.C., M.P.