RBS investing bailout cash in banned cluster munitions
This is a guest post from Tom Shelton of Handicap International UK
Taxpayer owned RBS has been identified as one of the main financial institutions – both in the UK and worldwide – continuing to invest billions of dollars in companies producing cluster munitions, despite these weapons being banned under international law, according to a new report released last week.
The report by Cluster Munition Coalition (CMC) members IKV Pax Christi and
Netwerk Vlaanderen shows that worldwide, 166 private and public financial
institutions from 15 countries continue to invest in companies that produce cluster munitions. Since the Convention on Cluster Munitions was adopted in May 2008, the global amount invested in companies that still produce cluster munitions totals US $39 billion.
The human and economic cost of cluster munitions is well-documented. The weapons cause widespread harm on impact and unexploded submunitions pose a threat to civilians for decades to come. Over the last 40 years, cluster munitions have killed and injured thousands of civilians and continue to do so today.
In the UK, 12 financial institutions are listed in the report’s global ‘Hall of Shame’. RBS is number four in the list, making it the only EU-based financial institution remaining in the top five investors in cluster munition producers worldwide.
Following the recent financial crisis, the bank is 83% state-owned after being bailed out by UK taxpayers. Despite this, the report identifies that RBS was part of a banking syndicate providing a loan to US cluster bomb producer Alliant Techsystems in October 2010 for an amount of US $80 million.
It is unacceptable for any financial institutions in the UK to still be financing,
either directly or indirectly, a weapon that has been officially banned under UK and international law, especially in the case of banks financed by public money. CMC campaigners are urging the UK government to take strong action and make clear to all UK banks and financial institutions, including those mentioned in the report, that they must respect the UK’s obligations under the Convention on Cluster Munitions.
Handicap International, as part f the CMC, believes that financial investment in the production of cluster munitions is a form of assistance, and is calling on all States to ban all investment in the production and trade of cluster munitions.
According to the IKV Pax Christi and Netwerk Vlaanderen report ‘Worldwide
Investments in Cluster Munitions: A Shared Responsibility’:
• 166 financial institutions from 15 countries are investing in cluster munition producers.
• The majority of these financial institutions (128) are from five countries that have not yet joined the Convention: China, Russia, Singapore, South Korea, and the United States, plus Taiwan.
• However, 38 financial institutions are from countries that have joined the
Convention on Cluster Munitions and are continuing to invest in cluster munition producers. These nine countries are: Australia, Canada, France, Germany, Italy, Japan, the Netherlands, Switzerland and the United Kingdom.
Some countries, including Belgium, Ireland, Luxembourg and New Zealand, have taken the lead in banning investment in these illegal weapons by passing national legislation. The UK government previously stated in 2009 its intention to work with
the financial sector, NGOs and other interested parties to promote a voluntary code of conduct to prevent indirect financing of cluster munitions. However, to date no action has been taken.
Many leading banks have changed their policies to reflect the growing
international rejection of cluster munitions. Worldwide, CMC members are
calling on other countries to follow this example by passing national laws
banning investments, and calling on financial institutions to disinvest from
The report ‘Worldwide Investments in Cluster Munitions: A Shared
Responsibility’ by IKV Pax Christi and Netwerk Vlaanderen is available at: www.ikvpaxchristi.nl/stopexplosiveinvestments