Japan: CSOs urge JBIC to implement strong measures to address bribery allegations against power plant in Indonesia
"Request for Measures to Suspend the Loan Disbursement and Mandatory Prepayment Concerning the Cirebon Coal-Fired Power Plant Project - Expansion Plan in Indonesia", 18 August 2023
"Japanese-to-English translation: Business & Human Rights Resource Centre"
The Japan Bank for International Cooperation (JBIC, wholly owned by the Ministry of Finance) and the 3 mega banks (Sumitomo Mitsui Financial Group, Inc., Mitsubishi UFJ Financial Group, Inc., Mizuho Bank, Ltd.) have been financing the Cirebon Coal-Fired Power Plant Project - Expansion Plan in West Java, Indonesia (Unit 2, 1,000 MW) (hereinafter "Unit 2 Project"). It was revealed during the course of the local trial that a business operator invested by Marubeni Corporation and JERA Co., Inc. was involved in bribery.
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According to the testimony of the witnesses at the trial and the statement of the defendant, the former governor of Cirebon mentioned that that former senior executives of Cirebon Energy Prasarana (CEPR), the operator of the Unit 2 project and a direct borrower from JBIC and owned by Marubeni Corporation (35%) and JERA (10%), were involved in bribery.
In response to this serious fact, environmental groups in Indonesia and Japan urges JBIC, a public financial institution, to promptly take measures to suspend loan disbursement to the Unit 2 Project and to enforce mandatory prepayment of loans that have been disbursed, in accordance with the "Recommendation of the Council on Bribery and Officially Supported Export Credits”
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With regard to the Unit 2 project, many issues have been pointed out, including the impact on local residents, such as loss of means of livelihood and environmental pollution; illegal processes, such as violation of the Cirebon Regency Spatial Plan and the improper issuance of environmental permits; human rights violations, such as harassment and intimidation against residents who express opposition and concerns; and retrogression against climate change measures. Thus, there have been repeated calls for the project to be halted.
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