Hydro project swindle in Sumatra

Issue 

Hydro project swindle in Sumatra

By Colin Pemul

Dirty dealings surround a proposed Japanese-backed hydro-electric project in western Sumatra's Riau province. The project will displace 23,000 people by flooding 128 sq km of prime agricultural land including 10 villages and 300 ha of protected forest. About 30 elephants and other wild animals are also threatened, as well as an ancient Buddhist temple.

Bankrolling the project is the Japan-based Overseas Economic Cooperation Fund (OECF). However, after a public relations disaster over Japanese involvement in Kedung Ombo, another Sumatran hydro project, the Japanese government has made release of the funds conditional on the Indonesian government producing signed agreements with each individual on resettlement, securing agreements on compensation, and relocating the elephants.

So far, the funds have not been released, partly due to a protest last September when some of the Sumatrans presented a 1000-signature petition to the Japanese embassy, the OECF office and the Department of Foreign Affairs, claiming the conditions had not been fulfilled.

The government has since put several plans into operation to get the funds released. It began by offering motorcycles to the eight village heads in the hope that this would secure their "cooperation". Two of the heads refused to accept the bikes, saying they could be interpreted as a pay-off.

As well, the Bank Rakyat Indonesia (People's Bank) has opened up easy credit to affected villagers with their promised compensation as collateral. With the compensation deal still under negotiation, villagers are taking loans on previously rejected guidelines. Once they are in debt, they will have little choice but to accept the project.

Meanwhile, people from the villages of Koto Tua and Ponkai have visited proposed resettlement sites. Those from Koto Tua say the land is uninhabitable. Muddy at the best of times, it turns to very deep mud after rain.

The plan for Ponkai is even more sinister. It has been allocated land owned by a palm oil company, where each villager will receive a house and 2 ha of oil palms on credit, to be paid off as crops are harvested and sold to the company at prices set by the company. The villagers have been told they will be relocated in 1994-95.

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