29 Dec 2020

Today, the Japan Bank for International Cooperation (JBIC), a public financial institution, announced in a press release that it has decided on December 28 to provide project financing of up to US $636 million to the Vung Ang 2 coal-fired power generation project (hereinafter referred to as “Vung Ang 2”) in Vietnam...The private-sector financial institutions participating in the cofinancing are believed to include Sumitomo Mitsui Banking Corporation, MUFG Bank, Mizuho Bank and Sumitomo Mitsui Trust Bank...

The project has raised concerns not only from civil society but also from investors. Nordea Asset Management, the largest asset manager in the Nordic region, disclosed in October 2020 that it had sent letters to public financial institutions and companies involved or alleged to be involved in the project, jointly signed by Amundi, AP7, Allianz and other institutional investors...

The construction of new coal-fired power plants is not consistent with the goal of the Paris Agreement to hold the global average temperature increase to well below 2°C relative to preindustrial levels and pursue efforts to limit the increase to 1.5°C. Considering the increasing seriousness of the climate crisis everywhere, including Vietnam, all new construction of coal-fired power plants needs to be halted immediately...

In July 2020, the Japanese government decided on the outline of the Infrastructure System Export Strategy and stated that, in principle, the government will not provide public financial support for overseas coal-fired power plants, while also stating that it will not apply the new policy to Vung Ang 2...[T]his is a serious double standard that should be criticized, as it is inappropriate to make exceptions for projects that have not started construction or even reached a financial agreement yet. In October 2020, Prime Minister Suga announced a policy of carbon neutrality by 2050. Vung Ang 2 and other projects excluded from the new policy contradict Japan’s decarbonization policy...

We again call on the Japan Bank for International Cooperation, Sumitomo Mitsui Banking Corporation, Sumitomo Mitsui Trust Bank, MUFG Bank, Mizuho Bank, Mitsubishi Corporation, and Chugoku Electric Power Company as well as Korea Electric Power Corporation to withdraw from the Vung Ang 2 coal-fired power generation project. We also call on the Export-Import Bank of Korea, which provides co-financing, and Samsung C&T Corporation and Doosan Heavy Industries and Construction Co., which are expected to participate in EPC, to withdraw from the project. We also urge the Nippon Export and Investment Insurance (NEXI), which is currently considering providing insurance for the project (as of December 29, 2020)...to make the decision not to be involved.

[Includes reference to the following companies: CLP Holdings, Standard Chartered Bank, OCBC Bank, DBS Bank & General Electric]