Japanese PM Urged to Toughen Standards for Development Super–Agency

Friday, March 5, 1999

NGOs also demand withdrawal from Filipino dam

An international appeal was delivered to the Japanese Prime Minister, Mr. Keizo Obuchi, today urging him to ensure that clear social and environmental standards are established for the new institution to be created by merging the Export–Import Bank of Japan (JEXIM) and the Japanese Overseas Economic Cooperation Fund (OECF). The open letter also calls on the Prime Minister to withdraw all financial assistance for the controversial $1 billion San Roque Hydropower and Irrigation Project in the Philippines. The appeal was signed by 77 citizens’ groups, 12 National Diet members and more than 500 individuals from 26 countries.

The new agency, which will be called the Japan Bank for International Cooperation, will have an annual budget exceeding $27 billion, making it the world’s single largest source of public financing for infrastructure and other investments overseas. By comparison, the World Bank commits about $20 billion in new loans each year. The Charter of the new agency will be presented to the Diet in the coming weeks.

The groups’ open letter states that "JEXIM and OECF support projects and investments that cause significant social and environmental destruction in recipient countries" indicating an "urgent need for more rigorous social and environmental impact assessment and information disclosure procedures for the new institution."

Ms. Ikuko Matsumoto, Aid Reform Coordinator for Friends of the Earth Japan says: "This appeal shows how concerned people are internationally about the poor quality of Japanese official development assistance. The new institution’s draft charter doesn’t include any reference to human rights and the environment, something that we would consider fundamental for an institution dedicated to improving the lives of people in countries less industrialized than ours. We hope that the government and the Diet will listen to the call from our colleagues around the world."

Ms. Tomiko Okazaki, Member of the Diet, says: "We must meet the crucial task of ensuring that the Japan Bank for International Cooperation has effective standards for access to information and procedures for social and environmental assessment and public participation. I feel grateful to be able to sign the letter with my colleagues around the world."

The open letter also calls on Japan to withdraw all financial assistance for the controversial $1 billion San Roque Dam, which the letter says "demonstrates the problems inherent in the current approach taken by JEXIM." JEXIM has already approved a $302 million loan for the project and is considering an additional $400 million loan, despite the fact that the project is opposed by thousands of indigenous Ibaloi people who will face serious impacts to their livelihoods should it be built. See attached briefing paper for further details.

Santahnay, the peoples’ organization in the area to be flooded by the dam, has stated that the dam "would mean the end of our continued survival as indigenous communities... We will not be a party to our own death... We stand for the defense of our indigenous culture and for the recognition of our right to self–determination."

Ms. Aviva Imhof, South–East Asia Campaigns Director for International Rivers Network, says "JEXIM must not fund the San Roque Dam. JEXIM’s current environmental guidelines state that people resettled by projects it funds must have given their consent. In the case of San Roque, more than 450 individuals who may be affected by the project have signed this appeal letter and have not given their consent. JEXIM is refusing to release any documentation on the project, citing principles of confidentiality. This is clearly unacceptable, and demonstrates that JEXIM has little accountability to either Japanese taxpayers, or the people whose lives will be affected by JEXIM loans."

The appeal to Mr. Obuchi comes in the wake of an international campaign for the adoption of common environmental and social standards for Export Credit Agencies. This issue is already being discussed by the 29 OECD countries.

Ms. Andrea Durbin, Director of the International Program at Friends of the Earth US, says: "the US Export–Import Bank and the Overseas Private Investment Corporation have already adopted tougher standards that provide public information and more rigorous social and environmental assessment procedures when reviewing projects. Japan should join the US and demonstrate leadership in the OECD by adopting common environmental and disclosure standards so that publicly financed projects do not create serious environmental or social problems around the world. We hope that the Japanese government will rise to the occasion."

Read the International Appeal to Japanese Prime Minister. re: JEXIM/OECF merger and San Roque Dam.


Ms. Ikuko Matsumoto, Friends of the Earth Japan
Tel: 81 3 3951 1081

Ms. Andrea Durbin, Friends of the Earth US
Tel: 1 202 783 7400 ext 209