A new report by Cluster Munition Coalition members IKV Pax Christi and Netwerk Vlaanderen[1] shows that worldwide, 166 private and public financial institutions from 15 countries continue to invest in companies that produce cluster munitions. Since the treaty that bans the weapon – the 2008 Convention on Cluster Munitions – was adopted in May 2008, the amount invested in companies that still produce these weapons totals US$39 billion. In the UK, 12 financial institutions are listed in the report’s ‘Hall of Shame’. The report notes that the Royal Bank of Scotland 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.

“The Royal Bank of Scotland is owned in large part by the UK government so it is quite disturbing that it turns out to be Europe’s largest loan provider to cluster bombs producers,” said Thomas Nash, Partner at Article 36. “We know it is possible to clamp down on these investments. Other governments have done it with impressive results and the UK itself has pledged to address it. Now they need to put words into action,” he added.

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 has stated that it believes investment in cluster bombs to be banned by the Convention on Cluster Munitions and has pledged to set up a working group with financial institutions and civil society, but it has not explicitly prohibited all types of investment in cluster munition producers.

“The UK has made good progress in putting the ban on cluster bombs into practice. US cluster bombs have been removed from UK territory, UK stocks are being destroyed and the UK has condemned use of cluster bombs by others. But it makes no sense to allow UK companies to continue financing producers of a weapon we have banned,” said Richard Moyes, Partner at Article 36. “The UK has kicked this issue into a working group, but we haven’t seen it do any work yet,” he added.

The 2008 Convention on Cluster Munitions prohibits assistance with the use, production, export, and stockpiling of cluster munitions. The Cluster Munition Coalition believes that financial investment in the production of cluster munitions is a form of assistance.

For more information, please contact:

Thomas Nash, +44 (0) 7711926730 thomas@article36.org

The Cluster Munition Coalition’s ‘Stop Explosive Investments’ campaign

http://www.stopexplosiveinvestments.org

The report ‘Worldwide Investments in Cluster Munitions: A Shared Responsibility’ by IKV Pax Christi and Netwerk Vlaanderen will be available from 25 May 2011, 10.00 Central European Time (CET) at: http://www.ikvpaxchristi.nl/stopexplosiveinvestments

NOTES

UK financial institutions listed in the ‘Hall of Shame’:

The Hall of Shame contains a list of financial institutions that still invest in cluster munitions producers. The eight cluster munition producers named in the report are:

Alliant TechSystems (US), Hanwha (Republic of Korea), Lockheed Martin (US), Norinco (China), Poongsan (Republic of Korea), Singapore Technologies Engineering (Singapore), Splav (Russia), and Textron (US).

The 12 UK based financial institutions listed in the ‘Hall of Shame’ as providing some form of financial services to one or more of the eight companies are:

Aberdeen Asset Management, Aviva, Barclays, Baring Asset Management, Henderson Global Investors, HSBC, Invesco, Lloyds Banking, Newton Investment Management, Prudential, Royal Bank of Scotland, and Veritas Asset Management.

About cluster bombs:

A cluster munition (or cluster bomb) is a heavy explosive weapon containing multiple – often hundreds – of small explosive submunitions or bomblets. Cluster munitions are dropped from the air or fired from the ground and designed to break open in mid-air, releasing the submunitions over an area that can be the size of several football fields. This means they cannot discriminate between civilians and soldiers. Many of the submunitions fail to explode on impact and remain a threat to lives and livelihoods for decades after a conflict.

About the Convention on Cluster Munitions:

The Convention on Cluster Munitions bans the use, production, stockpiling and transfer of cluster munitions and requires countries to clear affected areas within 10 years and destroy stockpiles of the weapon within eight. The Convention includes groundbreaking provisions requiring assistance to victims and affected communities. Signed in Oslo in December 2008, the Convention entered into force as binding international law on 1 August 2010 and is the most significant international disarmament treaty since the 1997 Mine Ban Treaty banning antipersonnel landmines.

About Article 36:

Article 36 is a civil society initiative founded in January 2011 to monitor and challenge the use of certain weapons technologies.  Article 36 aims to highlight concerns about certain weapons, to work with civil society around the world to understand and develop responses to these concerns and to promote practical action by individuals, organisations and states that will enhance the protection of people from such weapons. Article 36 is a member of the Cluster Munition Coalition and facilitates UK civil society advocacy on landmines and cluster munitions. For more information see: www.article36.org.

About the Cluster Munition Coalition (CMC):

The CMC is an international coalition with more than 350 non-governmental organisations (NGOs) working in around 100 countries to encourage urgent action against cluster bombs. The CMC facilitates NGO efforts worldwide to educate governments, the public and the media about the problems of cluster munitions and to urge universalisation and full implementation of the 2008 Convention on Cluster Munitions.

http://www.stopclustermunitions.org/