European Union bank blasted for links to Mubarak regime

European Union bank blasted for links to Mubarak regime

The European Union's house bank invested in funds that directly benefited the Middle East's ruling cliques even as it preached the importance of human rights and democracy, claims a new report obtained by Ahram Online.

The families and associates of Egypt's Hosni Mubarak, Syria's Bashar Al-Assad and Palestine's Mahmoud Abbas all gained from non-transparent transactions conducted with the European Investment Bank (EIB), with Cairo-based investment bank EFG Hermes playing a leading role, says a draft of the report by Counter Balance, a coalition of non-governmental organisations, Ahram Online reported.

Provisionally titled "The EIB's sleazy investment partners in the Middle East and North Africa: A look at who is being enriched by the EIB's strategic partnerships in the region", the investigation will be published on 25 January.

EIB is owned by the 27 member states of the European Union and is the continent's largest public lender.

Under scrutiny in the report is EIB's business partnership with Egypt's EFG Hermes bank and its related private equity firms, as well as Gamal and Alaa Mubarak, the two sons of the country's deposed president.

The investigation tracks 10 years worth of financial investments made by the EIB in Egyptian private equity funds. All of these funds, claims the report, have links to the Mubarak family and convicted industry and trade minister Rachid Mohamed Rachid.

The report looks at four investments made by EIB, a self-proclaimed non-profit financial institution, between October 2000 and May 2010, alleging the transactions benefited key figures in the Egyptian regime via EFG Hermes Private Equity.

Two EIB transactions involve 4.5 million euros with the Jordan High Tech fund in October 2000 and 6 million euros with the Middle East Technology fund in February 2001. Both funds were set up and managed by EFG Hermes Private Equity.

The other two transactions were a 6.3 million euros risk capital facility extended to EFG Hermes Holding Company in December 2005, and a 39 million euros co-investment with EFG Hermes Private Equity into the InfraMed Infrastructure Fund in May 2010.

Counter Balance's investigation questions the European Union's bank's involvement in these funds in the light of widely publicised information that Gamal Mubarak had an 18.5 per cent stake in EFG Hermes Private Equity and was on their board of directors. This means he would have directly profited from the EIB's injections of cash.

The NGO coalition also asks why the EIB associated itself with the InfraMed Infrastructure Fund when the strategic board chairman at the time was minister Rachid Mohamed Rachid.

The former minister for trade and investment has since been sentenced in absentia to 35 years in prison and ordered to pay a $237 million fine for profiteering, misusing public funds and corruption.

The investigation makes further connections between the EIB and Mubarak's ruling clique by looking at Gamal Mubarak's close associate Walid Kaba.

Kaba, who set up Bullion Ltd with the ousted president's son, not only managed Gamal's private offshore business interests but also sat on the boards of the parent company of EFG Hermes investment bank and its private equity division that ran the funds in which the EIB invested.

The money may also may have contributed to the associates of other repressive regimes in the region, the report says.

EFG Hermes's subsidiary in Syria is a joint venture with Syrian businessman Firas Tlass who is widely believed to belong to President Bashar Al-Assad's inner circle.

Counter Balance also connects the EIB with the Palestine Growth Capital Fund. This fund was allegedly misused by the President of the Palestinian National Authority Mahmoud Abbas to further his own political interests and has reportedly lost vast sums of money.

The report contrasts the EIB's behaviour in the Middle East with statements it has made about its goals and philosophy.

The bank has previously said it promotes "human rights and democracy projects, the fight against poverty and education and training" across the MENA region.

The report also questions why the EIB has chosen private equity funds as its strategy for development, claiming that as a financial product they are "inherently non-developmental."

Counter Balance's investigation also criticises the apparent lack of due diligence performed into those involved in chosen funds.

Formed in 2007, Counter Balance is a European coalition of development and environmental NGOs set up to challege the EIB which it claims lacks transparency and binding social and environmental standards.

Counter Balance claims the EIB does not fulfil the mandates for sustainable development by which it is legally bound.

Subscribe to Trend in Google News! Subscribe
Iran's president to speak before parliament
Iran's president to speak before parliament
Iran extends condolences to Azerbaijan over military helicopter crash
Iran extends condolences to Azerbaijan over military helicopter crash
Azerbaijan, Iran implementing important projects - ambassador
Azerbaijan, Iran implementing important projects - ambassador
Loading Bars
UK records more than 50,000 new coronavirus cases
Italy's economy projected to grow 6.3 pct this year
Kazakhstan decreases petroleum gas export to Hungary amid global pandemic
Militants kill 7 soldiers in Nigeria's northeastern Borno state
Iran nuclear talks adjourn, resume next week
South Africa hit by fourth COVID wave driven by Omicron
Budget for social rehabilitation and childcare to reach 52 mln GEL next year, Georgian PM says
Putin informs Erdogan on main results of Sochi trilateral meeting
Turkey introduces action plan to improve lives of the disabled
Construction of 50MW solar power plant underway in Kazakhstan
Azerbaijani FM, OSCE rep exchange views on OSCE Charter (PHOTO)
Human remains discovered in Caspian Sea and recovered - SOCAR
Iran highlights need for more customs cooperation with Pakistan
bp discloses investments in construction of power plant in liberated Azerbaijani lands
Turkmen gas may be supplied to Europe via Caspian Connector project - ambassador
Turkish, Russian Presidents hold phone talks
Azerbaijan’s Pasha Holding talks about development strategy
Azerbaijan's Heydar Aliyev Foundation, UNICEF sign another memorandum of understanding (PHOTO)
Azerbaijan shares data on number of vaccinated citizens
Azerbaijani, Turkish military pilots conduct joint training flights in Baku (PHOTO/VIDEO)
Azerbaijan confirms 1,703 more COVID-19 cases, 2,180 recoveries
Turkmenistan can supply natural gas to European market until 2050 - ambassador
Azerbaijan discloses export volume of petroleum coke
Azerbaijan's Finance Ministry to auction gov't bonds via Baku Stock Exchange
SOCAR begins testing of new mobile diving complex
Israeli co Fireblocks raising $400m at $8b valuation
Croatia remains one of Russia’s key partners in EU
Value of goods transported via road increases in Azerbaijan
U.S. job growth misses expectations in Nov.
Policy and Management Consulting Group shares data on Georgia’s economic outlook
Georgia, Qatar discuss favorable investment climate
Price indexes of financial, trade sectors at Uzbek stock exchange fall
Uzbekneftegaz obtains new industrial gas flow from Kulbeshkak field
Uzbek Statistics Committee shares data on imports of meat for 10M2021
Georgia’s economic climate remains stable – PMC
Uzbekistan reveals volume of bank loans allocated to various sectors of economy
Iran, Turkmenistan and Azerbaijan gas swap - win-win deal, says Iranian analyst
FMs of Azerbaijan, Poland hold meeting within OSCE Ministerial Council
Co-op between Turkmenistan, EU to focus on improving business climate till 2027
Azerbaijan's food import volume down for 10M2021
Zones free from animal diseases being created in Azerbaijan’s Karabakh, East Zangazur
Azerbaijan considers opening Indonesian Chamber of Commerce
Azerbaijan increases chemical production volume for 10M2021
Azerbaijan, Turkey begin work on establishing joint university - minister
Azerbaijan’s liberated territories have several types of renewable energy sources– RES agency
Azerbaijani parliament adopts amendment to servicemen insurance law
Azerbaijan may exempt sale of electric cars from VAT
Azerbaijan introduces excise taxes on electronic cigarettes, shisha
Concept for creation of "green energy" zone in Azerbaijan’s liberated territories prepared
Transaction to sell Chinese oil company’s stake in Azerbaijan closed
Output volume at Azerbaijan’s Kursangi, Garabagli fields revealed
Austrian interior minister becomes candidate for country’s next chancellor
Azerbaijan begins geological exploration at Tutkhun gold deposit in Kalbajar
Iran to import hay from Russia
Uzbek home appliance manufacturer Artel joins United Nations Global Compact
Economic stability - framework of Iran`s next year budget
BioNTech CEO confident of quickly adapting vaccine for Omicron
Situation is still fragile in South Caucasus - OSCE Chairperson-in-Office
Azerbaijan to strengthen social protection of population in 2022 – PM
Azerbaijan may exempt import of books and paper from VAT
Iran reveals its non-oil trade in 7 months
Iran aims to build new oil, gas refineries amid growing consumption
Uzbek Central Bank shares data on leading banks in terms of loans
Azerbaijani PM talks on measures to curb price increase
Iran seeks to establish joint banking network with Syria
Azerbaijan to expand agriculture dev’t in Karabakh in 2020 – minister
Demining of water basins in Azerbaijan's liberated Fuzuli, Aghdam underway - ministry
Azerbaijan removes electronic bracelets from 134 convicts within amnesty act
India seeks strong ties with EU, cooperation in transition to clean energy
Dubai's DP World pulls out of Haifa port privatisation bid
Azerbaijani Artillery Units hold live-fire exercises (PHOTO/VIDEO)
Azerbaijan to change state duties on issuing registration plates of road vehicles
Georgian business sector sees average monthly salary increase
Cementing ties with France, UAE places $19 bln order for warplanes, helicopters
Azerbaijan preparing development strategy for Karabakh - Karabakh Revival Fund (PHOTO)
Man of Armenian origin who attacked Azerbaijani soldier neutralized – MoD
Azerbaijan releases 14 prisoners from correctional institution № 16 as part of amnesty act (PHOTO)
Azerbaijan releases 122 prisoners from correctional institution within amnesty act (PHOTO)
Australia calls on Azerbaijan, Armenia to delimit and demarcate state borders
Azerbaijan sees growth of trading via Baku Stock Exchange
Azerbaijan to release 65 female prisoners within act of amnesty
Georgia’s domestic supply of natural gas slightly decreases
Azerbaijan clears almost half of "Araz Valley Economic Zone" Industrial Park of mines - minister
Azerbaijan releases seven prisoners within act of amnesty (PHOTO)
Azernews newspaper selected as media partner of ECO from Azerbaijan (PHOTO)
bp is first company to use flexible approach in management of energy resources during pandemic
Turkey’s fuel exports to Georgia plummet
EU firms in infrastructure sector spent higher share of their investment on energy efficiency
Azerbaijan to strengthen control over allocation of subsidies
Share of EU firms investing in improving energy efficiency falls
Partnered with Azerbaijani banks, VISA actively developing technologies for issuing digital cards
Azerbaijan expands list of goods not covered by VAT refund
Georgia’s electricity exports triple
Azerbaijan’s justice ministry talks number of people released under amnesty act (PHOTO)
Further strengthening of Azerbaijan's army is one of important tasks – PM
Azerbaijan discloses expenses on COVID-19 vaccination
Opening of Zangazur corridor is one of most important issues – PM
Azerbaijani Parliament adopts amendments to Tax Code
Over half of EU firms affected by physical climate change risks
Russia records over 32,900 COVID-19 cases in last 24 hours
All news