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Press Release: Japan Must Postpone Thilawa SEZ Financing Until Forced Displacement Reviewed

By US Campaign for Burma  •  April 1, 2014

Development project near Rangoon funded by Japanese government and Japanese auto manufacturers built on forced displacement and land confiscation 

(Washington, D.C., April 1, 2014) – The U.S. Campaign for Burma (USCB) strongly condemns the Japan International Cooperation Agency (JICA) for failing to responsibly manage its investment in the Thilawa Special Economic Zone (SEZ) outside Rangoon. JICA should not proceed with loan disbursement on April 10 as planned until proper due diligence is performed and impacted communities are provided with resettlement agreements that meet international standards.

JICA has stood by while Burmese authorities have coerced and intimated local residents into signing unfair relocation agreements that blatantly violate JICA’s own guidelines. In December 2013, regional Burmese authorities forcibly displaced nearly 300 villagers to a cramped, flood- prone resettlement site. In the upcoming months, nearly 5,000 more will be forcibly displaced.

JICA has failed to ensure that proper due diligence has been carried out. JICA accepted an Environmental Impact Assessment (EIA) from a private Japanese entity to fulfill JICA’s due diligence requirement for development at Thilawa SEZ. But the EIA does not include any due diligence on the impacts of resettlement or livelihood restoration for local residents. JICA’s procedures hold that the EIA must be made public for 120 days before JICA can finalize loan agreements and disburse project funds—a period that expires on April 10, 2014. But the current EIA is grossly inadequate and must be revised to include due diligence on resettlement before JICA moves forward with loan disbursement.

“JICA should immediately suspend the project and ensure that practices at Thilawa SEZ meet international standards on the rights of resettled communities,” says USCB Policy Director Rachel Wagley. “Proper due diligence must be carried out immediately. Thousands of residents who have relied on paddy farming are now facing forced relocation and financial distress.”

Rangoon regional authorities are not compensating families for their land or offering replacement land. Residents moved to a relocation site in December 2013 are facing grave concerns with flooding, water access, and structural stability (photos attached). Civil society groups had to intervene to postpone resettlement in November 2013 when authorities acted to move residents before houses or basic infrastructure had been constructed.

These families are being displaced and impoverished in order to make way for an industrial zone and commercial port, planned jointly by JICA, consortiums of Burmese and Japanese companies, and the Burmese government’s Thilawa SEZ Management Committee. Japanese auto manufacturers Mitsubishi, Toyota, Suzuki, Sumitomo, and Marubeni have all committed to opening operations at Thilawa SEZ.

The Thilawa SEZ resettlement process violates JICA’s Guidelines on Environmental and Social Considerations. In the Guidelines, JICA commits to ensuring accountability for the observance of international standards while financing foreign development projects. But Japan has not properly upheld these standards with Burmese authorities or sought to remedy community grievances or deficiencies in the resettlement plan at Thilawa SEZ.

International standards on resettlement, including JICA’s Guidelines, assert that people involuntarily relocated for development projects must be given enough support to restore their previous livelihoods or transition to a new livelihood. But the Resettlement Work Plan (RWP), written by Rangoon regional authorities, is woefully deficient. For example:

• It does not consider giving farmers replacement land as an option.
• It denies compensation for lost land based on the Burmese government’s 20 year-old expropriation, despite the villagers’ long-standing use and tenure on the land.
• It compensates villagers for lost crops and some animals at inadequate rates, and denies compensation for other lost animals that are important for villagers’ livelihoods.
• It assumes that villagers will find wage-based jobs as the SEZ is developed but fails to ascertain whether they have the necessary skills or to arrange for adequate training.

“JICA must use its financial leverage to immediately insist on proper compensation for resettled villagers and for the thousands more who will be resettled,” says USCB’s Rachel Wagley. “JICA and Japanese auto companies have shirked their responsibility to make Thilawa a model for proper stewardship of foreign investment in Burma—a responsibility that they have abundant skills and resources to fulfill.”

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