December 29, 2020
Statement:
NGOs Strongly Oppose Decision by Japan Bank for International Cooperation
to Support Vung Ang 2 Coal-fired Power Generation Project in Vietnam
Friends of the Earth Japan
Japan Center for a Sustainable Environment and Society (JACSES)
Kiko Network
Mekong Watch
350.org Japan
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 ofup to US $636 million to the Vung Ang 2 coal-fired power generation project (hereinafter referred
to as "Vung Ang 2") in Vietnam 1. The private-sector financial institutions participating in thecofinancing are believed to include Sumitomo Mitsui Banking Corporation, MUFG Bank, Mizuho
Bank and Sumitomo Mitsui Trust Bank 2. Vung Ang 2 has been criticized internationally, and many
problems with the project have been pointed out 3. The signatory NGOs strongly oppose JBIC'sdecision to support the project despite still failing to be accountable to address many criticisms,
including the project’s inconsistency with climate change measures and inadequate environmental
impact assessment. We once again urge the companies and financial institutions involved towithdraw from the project.
Vung Ang 2 plans to build two new 600 megawatt ultra-supercritical (USC) generating units inHà Tĩnh Province of central Vietnam. Initially, it was planned to be sponsored by Hong Kongbased electric power company CLP Holdings together with Mitsubishi Corporation, but CLP
announced its coal phase-out policy in December 2019 and decided to withdraw from the project.
Standard Chartered Bank of the United Kingdom, OCBC Bank and DBS Bank of Singapore, allof which had been considering financing, also withdrew from the project. General Electric (GE),which was expected to participate in EPC (engineering, procurement and construction), announced
on September 21 this year that it would “exit the new build coal power market” 4.

Japan Bank for International Cooperation, “Project Financing for Vung Ang 2 Coal-Fired Power Generation
Project in Vietnam” December 29, 2020 https://www.jbic.go.jp/en/information/press/press-2020/1229-014147.html
2Project Finance International, “AP: Vietnam – DBS exits Vapco 2” January 20, 2020
3
Friends of the Earth Japan, “Japanese environmental NGOs urge major investors to divest from Mitsubishi
Corporation to protect the climate” December 23, 2020 https://www.foejapan.org/en/aid/jbic02/va/201223.html
4General Electric, “GE to pursue exit from new build coal power market” September 21
https://www.ge.com/news/press-releases/ge-pursue-exit-new-build-coal-power-market
1The project has raised concerns not only from civil society but also from investors. Nordea AssetManagement, 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 theproject, jointly signed by Amundi, AP7, Allianz and other institutional investors 5.
The effects of climate change have become significantly visible worldwide. This year, fourtyphoons hit central Vietnam in a month, causing flooding and massive damage. Urgent action isnecessary for climate change. 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 foroverseas coal-fired power plants, while also stating that it will not apply the new policy to VungAng 2. However, in light of the fact that the government recognized the importance ofdecarbonization in dealing with the climate crisis and decided on a new policy, this is a serious
double standard that should be criticized, as it is inappropriate to make exceptions for projects thathave 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 BankingCorporation, 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 Bankof 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 theproject. We also urge the Nippon Export and Investment Insurance (NEXI), which is currently
considering providing insurance for the project (as of December 29, 2020 6), to make the decision
not to be involved.

Contact:
Friends of the Earth Japan
Nordea Asset Management, “Enquiry regarding the Vung Ang 2 coal-fired power plant project in Vietnam”
October 2020 https://www.nordea.lu/documents/staticlinks/Nordea_CEO_letter_on_climate_coal_phase_out_Vung_Ang_2.pdf/
6
Nippon Export and Investment Insurance https://www.nexi.go.jp/environment/info/a/2020013103.html
5

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