European Banks Financing Damaging Agrofuels in Latin America

May 25, 2008 at 7:18 pm Leave a comment

Friends of the Earth International


May 19, 2008

NEW REPORT: European Banks Financing Damaging Agrofuels in Latin America

/Friends of the Earth International urges banks to stop fuelling harmful
agrofuel boom /

BRUSSELS (Belgium) / MONTEVIDEO (Uruguay), 19 May 2008 – Many major
European banks are funding the rapid expansion of agrofuel production in
Latin America, leading to large scale deforestation, increasing human
right abuses and threatening food sovereignty, according to a new report
released today. [1]

The report – released by Friends of the Earth Europe amid global worries
about the increasing impacts of rising food prices – calls for an end to
investments by European banks in harmful agrofuel projects. [2]

Agrofuels have been blamed as a major factor driving up food prices.
According to the UN and the World Bank, 100 million more people are
currently facing severe hunger due to higher prices for basic foods. [3]

The report ‘European financing of agrofuel production in Latin America’
documents how major European banks, such as Barclays, Deutsche Bank, BNP
Paribas, Axa, HSBC, UBS and Credit Suisse are investing billions of
Euros in the production and trade of sugar cane, soybeans and palm oil
in Latin American countries.

Fuels from sugar cane, soybeans and palm oil are increasingly used in
Europe. Their large scale production in countries such as Brazil,
Argentina, Paraguay and Colombia is extremely controversial as it leads
to the destruction of the Amazon and other valuable ecosystems, as well
as to the contamination of drinking water. Large scale plantations also
lead to human rights violations against peasants, with working
conditions on some plantations in Brazil classed as modern slave labour.

At the same time agrofuel companies are making record profits, enabled
by loans, investments and other financial support from private banks.
All major European banks have invested billions of Euros over recent
years in agrofuel producing companies such as Cargill, Bunge, ADM, Cosan
and Brasil Ecodiesel. Several of these companies have been involved in,
and convicted of, illegal activities in Latin America. [4]

Some examples of European banks involvement:


in 2007 Deutsche Bank owned 35 per cent of the shares of Brasil


Bunge currently has credit facilities worth more than a billion
Euro from banks such as Barclays, BBVA, BNP Paris, Deutsche Bank,
HSBC, Royal Bank of Scotland, KBC and Credit Suisse


in 2007 Deutsche Bank and Credit Suisse provided financial
services totalling more than a billion Euros to Cosan

Paul de Clerck, Friends of the Earth International corporate campaign
coordinator, said:

“Agrofuels are a booming business and banks are out to make maximum
money while millions of people are suffering from lack of food and the
environment is being destroyed. Banks should immediately stop their
investments in such harmful agrofuel development.”

Friends of the Earth is also calling on the European Commission to
revise its plans for a mandatory 10% target for the use of agrofuels in
transport by 2020, which it says will exacerbate the problems associated
with the production of agrofuels. Agrofuels are billed as a solution to
climate change but growing scientific evidence shows that they may
actually increase rather than decrease greenhouse gas emissions,
especially if wider knock-on effects, such as changes in land use, are
taken into account.

//”Using crops to feed cars instead of people is a false solution to
climate change,”//// /added Mr de Clerck. /


In Brussels, Belgium: Paul de Clerck, Friends of the Earth
International: Mobile: +32494380959, or email

In Montevideo, Uruguay: Carlos Santos, Friends of the Earth Uruguay:
Mobile: +5491160191836 / +59898889498 or email


[1] The full report ’European financing of agrofuel production in Latin
America‘ is online at:

[2] Biofuels are plants grown to make fuel instead of food. When they
are grown in intensive agricultural systems, such as
environmentally-damaging large-scale monoculture plantations, they are
called agrofuels’.

[3] This estimate was cited by UN Secretary General Ban Ki-moon on April
29 2008 when he announced a new task force to tackle the global food crisis.

[4] In March 2007, the Supreme Court in Brazil judged that Cargill
operated illegally while constructing a terminal on the banks of the
Tapajos River to facilitate exports of soy beans without proper
Environmental Impact Assessment. See fact sheet at:

In March 2008 the Federal Regional Tribunal in Brasil ordered Bunge to
immediately stop using wood as energy source for its facilities in Piaui
due to the lack of necessary permits. See fact sheets at:
and _


Entry filed under: Climate change & Communities, Corporate Accountability, Latin America Independence.

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