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Uruguay Mills: Open Letter to Dr. Dwernychuk

Open letter to Dr. Wayne Dwernychuk from Jorge Daniel Taillant of CEDHA.

Mr. Dwernychuk,

Your article entitled Argentina’s Environmental Hypocrisy, which appeared in the Latin Business Chronicle not only fails to intelligently understand the issues revolving Botnia’s illegal pulp mill venture in Uruguay, it also, with respect to Argentina’s political stance on its own environmental situation, [is] anachronistic and false. Perhaps you should read up a bit on what Argentina is doing lately with its pulp mill sector and with the Matanza Riachuelo River Basin. You are clearly not up to date on current affairs. It is sad that you would make such shortsighted passing comments about which you clearly know nothing about. In your ignorance, you are as guilty as your own critique regarding the feeding of erroneous information to the public.

Coming from a member of an IFC-financed consulting group (Hatfield), your opinion that Argentines are “so ignorant” is not only culturally inappropriate, it is culturally imperialistic and fails to make an informed and integral analysis of the Botnia and the IFC’s development fiasco. Considering you are a foreign consultant that has only been hired to review a technical industry profile of a projected pulp mill, your task is quite limited, and your perception of the issues, as is obvious from your statements, can only also be as limited. To draw such far reaching and extremely critical (and uninformed) conclusions about several years of an evolving problem, from this myopic industry standpoint on merely the technical aspect of a mill design, is assuming and unprofessional. This conflict is not merely about whether or not Botnia today meets industry standards.

On April 20, 2005, IFC lied to their board of directors about the Botnia Orion project (or grossly misunderstood – either way it is an unacceptable error) regarding public opinion about the “social license” the IFC requires for Category A projects – they said it enjoyed “broad public support” – go find the document, it’s still on their website- if you cannot find it, I can send you the link. Ten days later 50,000 concerned citizens (you would call them “ignorant Argentines” – although there were a great many Uruguayans present) marched peacefully to express their opposition to the investment. I wonder if an Argentine consultant called 50,000 Canadians expressing their democratic opinion “ignorant”, what you might think about such an opinion? It is frankly rude and imperialistic. This 50,000 person march, I will point out, was the largest march ever against a World Bank project. It was followed by two additional marches of 120,000 and 130,000 people the following anniversaries of the first march.

Contaminating industries, Mr. Dwernychuk - (and Pulp Mills is a Contaminating Industry as categorized by the World Bank), need to abide by strict procedural regulations. And this is not only about industry standards but also regarding community engagement and social license. IFC lays out clear such standards-they are called Performance Standards (I inform you that we have personally helped develop those standards, which is why we recognize clearly when they are violated), precisely to avoid the conflict they and Botnia have caused.  Botnia, ENCE, and the IFC, failed to comply with those standards in step one. The rest was an escalating fiasco showing how not to move forward with an environmentally sensitive project. The fact that you’ve “eventually proved” to comply with industry standards and technical specification --Botnia previously had not -- does not mean that you’ve done your community homework. This gap, along the way, made Botnia and IFC lose all credibility and critical local support for the investment.

On policy violations, the CAO confirms our opinion. In fact, Hatfield, your employer, even confirms our opinion. Look at the complaint we filed to the CAO, and you will see that Hatfield concluded that Botnia was missing quite a bit of information, much of which had to do with precisely the issues we focused on in our complaint. The late provision of that information, combined with the great mismanagement, arrogance of the project sponsors, that refused even to give local stakeholders terms of engagement rules, led to the problem that we have today.

It is not as you indicate in your unfortunate article, Argentina’s fault that we are where we are today. Botnia and the IFC failed to follow their own rules, and were completely insensitive to local opinion-they are to blame for this conflict. This case has turned out to be a great lesson for IFC and for international development finance generally.

I would suggest you revisit your article, and if I were you, I’d publish a public apology to the thousands of local residents that have been offended and insulted by your narrow-minded and culturally imperialistic view.

Nothing further,
Jorge Daniel Taillant
Executive Director,
Center for Human Rights and Environment (CEDHA),
Buenos Aires, Argentina

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