July 2, 2003

Mr. Fraser Reilly-King
Halifax Initiative
153 Chapel Street, Suite 104
Ottawa, ON  K1N 1H5
Dear Mr. Reilly-King

I wish to respond to your letter of May 16 in which you raise a number of questions concerning Export Development Canada’s practice of assessing human rights issues related to transactions that we may consider for support.

You suggest that I intervene with the Chinese authorities in the development of the Three Gorges Hydroelectric Project. While EDC continues to follow developments concerning the project, your request is more appropriately addressed to the Department of Foreign Affairs and International Trade Canada. Canadian foreign policy and government-to-government relations are quite properly handled by political authorities, not export credit agencies. This is consistent with actions taken by the Swiss government.

As you are aware, our own process to consider the human rights implications of projects is executed through our political risk assessment function. Human rights are reviewed where they constitute issues of concern as determined by the nature and location of the proposed project. We will continue to dialogue with the Halifax Initiative and other stakeholders on the effective ways to provide more detail about our human rights assessment process.

Finally, you ask that EDC agree not to be involved in future with the Three Gorges Hydroelectric Project. This is something that we cannot do. It is not our practice to decline projects on a prima facie basis. I am confident that the procedures we have in place will allow us to conduct thorough reviews of the relevant issues related to this or any other project, those being, inter alia, a review of the environmental and related social impacts of a project and the human rights concerns.

Thank you for your enquiry.

Yours sincerely,

A. Ian Gillespie