Developing Countries Should Get Paid for Environmental Damage
Martin Khor | South Centre | October 2010
days, the casual observer might be tempted to think that on the world stage, it
is not the extent of environmental damage that determines what - if any -compensation
is paid to victims, but the identity of the party sustaining the damage. At
least that is the impression one gets when following the media coverage of the
Gulf oil spill. After all, throughout the past decades far greater disasters
have caused far more extensive damage in developing countries without any
compensation at all for human or material losses. Today, it is high time that
the governments of developing countries follow the Obama Administration's
example and put greater pressure on multinational corporations to compensate
for long-term damages their business activities inflict on local communities.
While everyone is still talking about the BP oil spill, large-scale ecological disasters caused by private, international firms are nothing new. What is new is the concentrated and largely successful effort by a government (US) to induce a major international corporation (BP) to pay for damages. The following examples clearly show that this has hardly ever been the case up to date, in particular in the context of developing countries. In Ecuador, Texaco - today known as Chevron - continued to dump crude oil into the Amazon rain forest for years. The Niger delta is the site of yet another environmental catastrophe of gigantic proportions, thanks to leaky oil wells at the site of old drilling holes. Neither in Ecuador nor in Nigeria did the damaged parties succeed in obtaining court-settled compensation payments. This was due to the firms' reluctance to admit to any wrongdoing and be forthcoming about payments, as well as to the ineffectiveness and corruption of the regimes on the spot. The best known example remains Bhopal in India, where a poisonous gas leakage at Union Carbide killed over 2,300 individuals and injured tens of thousands of others, many of whom retained permanent health damage. While symbolic payments were made in this case, they were blatantly insufficient given the sheer scale of the disaster. Inspired by the recent successes of the Americans, Bhopal victims are currently attempting to get their cases retried in court.
However, it is not only governments in developing countries that must do a better job at getting multinational corporations to pay for damages inflicted in the event of ecological disasters, but also the appropriate authorities where these firms are registered. Throughout the world, firms should have to face the fact that they have to pay compensation. It is simply not acceptable that they cash in on profits while ignoring the long-term costs of their business activities. In the firms' countries of origin, governmental authorities must pass laws that hold them accountable for any environmental damage they cause not only at home, but also abroad. It is imperative to speedily conclude international agreements that will regulate compensation claims and payments in the event of environmental damage.
This summary was prepared by the Atlantic Community editorial team from "Pay Developing Nations for Eco-Disasters" published here by South Centre.