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Tuesday, 7 June 1994
Page: 1440

(Question No. 1362)


Senator Chamarette asked the Minister representing the Treasurer, upon notice, on 3 May 1994:

  (1) What plans does the Asian Development Bank have to remove the toxic contaminated fertiliser supplied to farmers in Bangladesh under a bank-funded program.

  (2) What plans are in place to provide health care and compensation to people affected by the fertiliser.

  (3) What action is being taken against the supplier of the contaminated fertiliser, Stoller Chemical Corporation

  (4) When was the Treasurer, in his capacity as a governor of the bank, informed of this matter.


Senator Cook —The Treasurer has provided the following answer to the honourable senator's question:

  (1) Under the project financed by the Asian Development Bank, the procurement of the fertiliser was the responsibility of the Government of Bangladesh, which agreed on the product specification with the supplier but did not carry out product verification prior to the shipment of the fertiliser to Bangladesh.

  The Asian Development Bank is not directly involved in the removal of the contaminated fertiliser supplied to farmers in Bangladesh. This task is being undertaken by the Government of Bangladesh. However, the Bank has liaised closely with Greenpeace and authorities in Bangladesh and the United States to ensure the safe disposal of the remaining contaminated fertiliser. The Asian Development Bank has also financed a staff consultant to assist the Government of Bangladesh to prepare a Reshipment Plan for the transport of the contaminated fertiliser to the United States.

  Disposal of the contaminated fertiliser is being handled by authorities in the United States. As the result of an out of court settlement, a Disposal Plan is currently being formulated by technical and legal advisers for the Gaston Copper Recycling Corporation (the source of the waste material which was subsequently mixed into the fertiliser by Stoller Chemical Corporation), in consultation with the United States Environment Protection Agency (USEPA), US Treasury, US Department of Justice, the Bangladesh authorities (including the technical adviser financed by the Bank) and a disposal facility in Chicago. It is hoped that an agreed Disposal Plan can be submitted to the US judge before 1 July 1994.

  As part of the settlement the Disposal Plan is to be partly financed from a sum of $US600,000 set aside from the agreed fine imposed on the Gaston Copper Recycling Corporation. The Bangladesh Government has agreed to pay the cost of transporting the material within Bangladesh and the cost of shipment to the United States.

  In order to avoid a repetition of a similar incident in the future the Asian Development Bank has recently approved an advisory technical assistance grant to assist Bangladesh develop effective regulatory, legal and administrative frameworks to govern the importation and use of potentially hazardous substances.

  (2) In July 1993 the Bank financed two independent experts in environmental epidemiology and agricultural toxicology to carry out a health risk assessment of the incident. The investigation was assisted by the World Health Organisation in Geneva. The experts undertook a detailed examination on the likely impact of the contaminated fertiliser on the soil, groundwater, crops and on any person who may have had direct contact. The experts concluded that:

  "it is highly unlikely that either human health or the environment has been adversely impacted from the ZOS (fertiliser) applied to rice paddies in Bangladesh."

  The consultants concluded that programs for health care, environmental clean up or the provision of alternative supplies of water were not required.

  The low level of risk resulted from one off applications or low application rates, and the low solubility of the contaminants.

  The report provided by the independent experts was made available to Greenpeace.

  (3) It is understood that individuals from Stoller Chemical Corporation are the subject of legal action in the United States for violating regulations under US domestic legislation relating to the disposal of waste material. Stoller Chemical Corporation has filed for bankruptcy.

  Gaston Copper Recycling Corporation agreed to an out of court settlement on 1 November 1993. Out of the agreed fine, an amount of $600,000 was set aside by the US courts to finance the disposal costs of the remaining material. Technical and legal advisers for Gaston Copper are currently working with USEPA, US Treasury, US Department of Justice, the Bangladesh authorities (including the technical adviser financed by the Bank) and a disposal facility in Chicago to develop a Disposal Plan acceptable to all parties.

  (4) The matter is handled by the Management and the Board of Directors of the Bank (under the powers delegated to it by the Board of Governors). Our Executive Director, Dr Peter McCawley, has been monitoring the situation. The Treasurer was advised of the matter in the preparation of the response to the Senator's question.