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DAM-L Press Advisory "MSDW RECEIVES CHINESE NEW YEAR GREETING TO STOP FINANCING OF THREE GORGES DAM" (fwd)
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Date: Tue, 30 Jan 2001 17:04:26 -0800 (PST)
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Subject: Press Advisory "MSDW RECEIVES CHINESE NEW YEAR GREETING TO STOP FINANCING OF THREE GORGES DAM"
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International Rivers Network
Press Advisory
January 30, 2001
Contact: Doris Shen
510 848 1155 ext 317
Morgan Stanley Dean Witter Receives Chinese New Year Greeting: Stop financing of Three Gorges Dam
Petitioners call for Boycott of MSDW’s Discover Credit Card Services
(Berkeley, CA) In the spirit of the Chinese New Year tradition of no monetary loans during the New Year's period, Morgan Stanley Dean Witter, CEO Philip J. Purcell, received a red envelope from over 1000 petitioners urging the firm to publicly commit to no more financing of the highly controversial Three Gorges Dam. Petitioners declared a boycott of the firm’s Discover Card and customer services until written confirmation is provided that the firm will not provide any further financing, direct or indirect, for the scheme to build the world's largest dam on the Yangtze River. Petitioners are also calling for the firm to adopt environmental and social policies to govern core business practices, including underwriting.
IRN launched the boycott of the Discover Card as a means to pressure the firm to commit to a public policy of not participating in any direct or indirect financing of the Three Gorges Dam project. "The Three Gorges Dam is an egregious environmental and social debacle that even the US Export-Import Bank and World Bank, the largest financier of mega-dams worldwide, has refused to fund," said Doris Shen, campaigner for IRN.
"With the Three Gorges dam, Wall Street's bottom line is the end of the line for close to two million people and the Yangtze River ecosystem. Internationally recognized environmental and social criteria needs to be adopted by all private investment firms to stop funding of disastrous projects," continued Ms. Shen.
University students, a primary marketing group for the Discover Card, comprised a large number of the petition signatures.
Morgan Stanley Dean Witter and other Wall St. firms underwrote a total of $830 million in bonds to the China Development Bank (CDB) the single largest funding arm for the dam in 1997 and 1999. Morgan Stanley's continued involvement with the dam is through their joint venture with the China International Capital Corporation (CICC), the lead advisor on overseas capital raising for the dam. CICC is managed and 35% owned by MSDW. Wall St. firms have made an estimated $5.4 million in profits underwriting the deal. The Chinese government guarantees all bonds.
"We will not allow MSDW to shirk its responsibilities for the dam’s impacts on people and ecosystems. We plan to maintain and increase the level of outreach and education about Morgan Stanley Dean Witter’s lack of environmental and social ethics in its lending and underwriting practices", said Doris Shen.
The cost of building the dam is estimated at $25 billion but could run as high as $72 billion. The project is already burdened with cost overruns and technical difficulties. Reports have shown the dam is rife with corruption and embezzlement of funds originally allocated for relocation and compensation for hundreds of thousands of people.
-30-
For more information on the Boycott Discover card campaign and Wall St. firms financing of the Three Gorges Dam, visit www.floodwallstreet.org. For the latest news updates and analyses on the Three Gorges Dam, go to www.irn.org
Notes to the editor:
-According to its 1999 annual report, Morgan Stanley Dean Witter Credit Services (including the its Discover Credit Card) provided the firm with $662 million in net income during fiscal 1999.
- The Three Gorges Dam on the Yangtze River in China will create close to 1.9 million project refugees, flood homes and cultural treasures, and endanger human health. Neither the World Bank nor the US Export Import Bank are willing to finance the dam. Ignoring warnings of project critics, Morgan Stanley Dean Witter helped underwrite $830 million in bonds for the China Development Bank (CDB) in January 1997 and May 1999. The CDB lists the Three Gorges Dam as its top loan commitment. (for a copy of the CDB bond prospectus page that includes a description of loan commitments of the bank, go to http://www.floodwallstreet.org/financiers/prospectus15.html )The dam has resulted in imprisonment, harassment and censorship of citizens who have dared to criticize the dam’s effectiveness for energy production and flood control.
-The Ballona Wetlands, an estuary on the Los Angeles coast, will be ravaged by the proposed Playa Vista development. Impacts include 10 new tons of air pollution daily to the region and destruction of habitat for a project the public has said they do not want. More than 95% of historical wetlands have been destroyed in Southern California, and Ballona is the largest remaining unprotected coastal wetland ecosystem in this region.
www.wetlandsactionnetwork.org
- In April 2000, Morgan Stanley Dean Witter, through its joint venture, China International Capital Corporation, helped underwrite $2.89 billion in stock for PetroChina. The company plans to build a pipeline that will extract Tibet’s oil and gas resources for use in mainland China. The rights of local Tibetans have been ignored during the planning process despite the significant environmental degradation it will cause. Like the recently defeated World Bank resettlement project, oil and gas development in Tibet’s Amdo Province serves only to consolidate Chinese control over Tibet. www.tibet.org/sft
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