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Tens of Thousands March … Again to Oppose Botnia Pulp Mill

Argentine-Uruguayan Border. April 27, 2008 - In yet another public expression of resistance to international corporate insensitivity to popular opinion, tens of thousands braved a torrential downpour, and marched against the BOTNIA pulp mill company from Finland, owner of one of Latin America’s largest and most controversial pulp mills ever.
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Oy Mesta Botnia, a Finnish pulp mill giant decided to transfer most of its Kraft pulp mill production abroad, where wages are lower, where trees grow faster, where environmental controls are more lax, and where governments provides highly profitable benefits. President Kirchner of Argentina, at a meeting of European heads of State with Latin American Presidents in 2006, that “this is the export of contaminating industries to the developing world”.
The project was buttressed by some of the world’s top and most influential investment firms, including the IFC (the World Bank’s private lending arm), Finnvera (the Finnish State owned export credit agency), the Nordic Investment Bank (a public Nordic multilateral bank), Nordea (a private Scandanavian Bank), Calyon (of Credit Agricole), et.al. The Dutch bank, ING pulled out of the investment when local communities complained of their intention to support Botnia and following a damning audit of the project by the World Bank’s ombudsman the CAO.
Local communities who live off of tourism revenues and agriculture, just kilometers away from the site chosen by Botnia for the mill, immediately opposed the Kraft pulp investment as it would bring foul odor, heavy traffic, and destroy the beautiful natural landscape that attracts hundreds of thousands of tourist each year to the clean banks of the Uruguay River. Anyone who has ever past a pulp mill, say community groups, immediately recognizes the rotten egg smelling process used by pulp producers.
When things began to get out of hand at the mill site, due to mounting social opposition and conflict, Presidents Kirchner and Vasquez (of Uruguay) called a 90-day truce to sort out differences, requesting that the mill halt construction, but Erkki Varis, Oy Metsa Botnia’s CEO, after a 9% fall in stock prices on the international markets after the announcement, ignored the request and ordered construction to continue, suggesting that Botnia had all the necessary permits and a green light from the IFC.
IFC Chief, Lars Thunnel, a Swedish national, fiercely defended the investment before the World Bank’s Board of Directors. Local communities point to the fact that Mr. Thunnel is a financial guru of Scandinavian financial circles, and suggest that it is probably no coincidence that several of Scandinavia’s most influential banks, including Nordea, the Nordic Investment Bank, and Finnvera are financial partners in the investment. Thunnel has conveniently paved the way for an investment that should have never happened. It is also probably not a coincidence that the World Bank decision to fund the project came while Finland chaired the EU presidency. Peter Mandelson, the EU’s Trade Representative even took time from his agenda to travel to Buenos Aires, to pressure then president Kirchner to ease opposition to the investment, or face possible trade repercussions. Mandelson also pressured then World Bank president, Paul Wolfovitz to give Botnia the thumbs up, which eventually, he did. Some speculate that Wolfovitz, a man closely associated with Dick Cheney, artifice of Bush’s war policy, was sending a message to the Kirchner government, in retaliation for Argentina’s support of Venezuelan participation in the UN Security Council.
The Finnish government, which has tried to maintain distance from the investment, claiming it is a private venture over which it has no bearing, as it turn out, is one of the largest investors in the project proving key loans from its State bank Finnvera, as well as owning 49% of Kemira, a chemical company built on Botnia premises in Uruguay. Kemira ironically produces 100% of the chlorine involved in pulp processing, the key contaminating agent. A complaint by local communities filed in Finland, before the office responsible for overseeing corporate compliance of the OECD Guidelines for Multinational Enterprises, the same government ministry that promotes the investment, was closed.
Local communities mounted an international roadblock on November 20th, 2006, against the mill, on the eve of the IFC Board of Directors vote – which they knew, would unleash most international investment funding for the project and practically kill their attempts to halt Botnia. Community representatives traveled to Washington days before the loan vote to try to convince the World Bank to reject financing. Lars Thunnel accused them of trumping up photographs, and overstating the impacts of the mill. But the community returned the accusation against Thunnel’s staff, pointing to a document presented by IFC to the Board of Directors on April 10th, 2005, suggesting the project had “broad public support”. Ten days later, the world’s largest march against a World Bank project occurred spontaneously bringing 50,000 people to the bridge linking Argentina and Uruguay.
That day has become a landmark in Argentine environmental history. The following year, a commemoration march attracted 100,000 people, and the next year, 120,000. Yesterday, the forth anniversary of the march took place, and despite a torrential downpour which discouraged many marchers, 80,000 braved the weather and showed up to manifest their continued repudiation to the Botnia investment. The roadblock which went up on the even of the IFC vote in 2006, never left, and has now well past the 500-day marker of an international blockade which impedes most overland traffic between Uruguay and Argentina.

More Information

Jorge Daniel Taillant
Center for Human Rights and Environment (CEDHA)
Tel. (54) 9 11 6 729 5466
jdtaillant@cedha.org.ar