Swedish and Norwegian aid organisations have both encountered instances in which American terror laws have halted the flow of international development aid.
One year ago the LO-TCO Secretariat of International Trade Union Development Co-operation set aside aid money for a trade union project in Liberia. The money was sent via Föreningssparbanken (now called Swedbank) and an American bank.
“The American bank demanded to know exactly which organisations the money was aimed for. We refused and asked the bank to resolve the situation.
“This they duly did, but they only paid the money back when Föreningssparbanken’s lawyers threatened to sue the American bank,” said Håkan Löndahl, LO-TCO’s development aid manager.
Norwegian aid agency Kirkens Nödhjelp says that it had hundreds of thousands of kronor confiscated by American authorities a few years ago. The money was intended for countries that the USA disliked, Norwegian newspaper Dagbladet reports.
According to the newspaper, the Office of Foreign Assets Control (OFAC) has both the power and the possibility to block aid from foreign countries in cases where transactions are carried out using US dollars.
As transactions of this nature pass through American banks, OFAC can intervene if it suspects that the money is being used to finance terrorism.
“It makes it difficult to provide emergency aid,” Eigil Schjander-Larsen from Kirkens Nödhjelp told Dagbladet.
The Norwegian organisation has had its money blocked on at least two occasions.
In 2003 OFAC confiscated just over 250,000 kronor intended for an AIDS conference in Cuba. It took two years for Kirkens Nödhjelp to get its money back.
The second case concerned an aid project in Burma, for which the money has not yet been returned.
Both Kirkens Nödhjelp and Norsk Folkehjelp now avoid making payments in dollars.
Anders Åhlin from LO-TCO says that terrorism laws can sometimes hinder the sort of trade union aid that the organisation provides.
“We often provide aid to trade union organisations in dictatorships.
“We have no reason to tell foreign banks who we cooperate with.
“If that became common practice we could then see the emergence of an unholy alliance between the fight against terrorism and attempts by dictatorships to describe all opposition as terrorism,” said Åhlin.