ECONOMY

UBS backs away from role in dam in SE Turkey

ZURICH (Reuters) – Switzerland’s largest bank UBS announced yesterday it was pulling out of its mandate to advise on the financing of a controversial Turkish dam because of fears about the plan’s social and environmental impact. The Turkish government’s plan to build the Ilisu dam in the southeastern part of the country has drawn fierce criticism from environmental groups, who have said the scheme would displace over 30,000 local Kurdish citizens and flood towns. «The decisive factor behind this termination is that the general progress of the project has been unsatisfactory in recent years,» UBS said in a statement. «Until now there has been no definitive decision on what accompanying measures are to be taken to minimize the social and environmental impact of the project,» it said. UBS said it had already advised the lead management of the suppliers’ consortium of its decision to withdraw from the contract, under which UBS would have structured and arranged financing and provided related consultancy services. British engineering group Balfour Beatty withdrew from the project last November, citing commercial, environmental and social concerns. «I am pleased with OTE’s excellent performance throughout 2001,» declared OTE Chairman and Managing Director Nikos Manassis. «The final tariff rebalancing rounds provide us with a sound cost-based platform to continue building our traditional fixed-line businesses and face competition wherever it emerges.» he added.