EAC raises questions over support from UK Export Finance for a Turkish-based partner company

The Environmental Audit Committee has written to a Turkish-based partner company benefiting from UK Export Finance with questions about its activities in the UK. It comes ahead of a hearing of its UK Export Finance inquiry with businesses and Ministers on Tuesday 19 March. 

The company, ENKA UK, a UK subsidiary of Turkish construction company ENKA, was granted £88m support by UKEF for work on a gas-fired power plant to be constructed in Iraq.

The Committee has raised questions over UKEF’s decision to support ENKA UK, and has written to the company to clarify: activities ENKA UK carries out in the UK; sites the company has owned or occupied in the UK; UK sourcing of goods or equipment to be used in the project’s construction in Iraq. 

The letter asks for confirmation of how many of ENKA UK’s employees are based in the UK, since none were available in the UK to give oral evidence to the Committee. UKEF’s role is to support UK businesses to ensure that no viable UK export fails for lack of finance or insurance.  

Environmental Audit Committee Chair Mary Creagh MP said:

“This gas-fired project in Iraq is another of UK Export Finance’s energy projects that supports fossil fuels overseas, locking developing countries into high-carbon energy production and flying in the face of the Government’s commitment to cut greenhouse gases, and end fossil fuel subsidies.

“UKEF has questions to answer over its decision to support ENKA UK, which is benefiting from financial guarantees from the UK Government in describing itself as a UK company.”

ENDS

A copy of the letter is attached to this email

Note to journalists:

In 2017/18 ENKA UK received almost £88m maximum liability in supplier credit and letter of credit guarantees from UKEF to support the company’s participation in a gas-fired power plant construction in Iraq. This project was UKEF’s ninth largest maximum liability and the highest level of support for an energy project in UKEF’s portfolio that year.

Data on all projects supported by UKEF in 2017/18, including ENKA UK, is available on UKEF’s list of businesses supported on the Gov.uk website. Data on ENKA UK’s company listings is available in its filing history on the Companies House website.

The EAC’s UK Export Finance inquiry is examining the scale and impact of finance provided by the UK Government in financing fossil-fuel projects in developing countries in light of the UK’s Clean Growth Strategy which aims to grow national income while cutting greenhouse gas emissions.