As Japan’s Aid Money Pours In – Community Groups Raise Concerns*

When three villagers from rural Myanmar visited Tokyo earlier this month they came equipped with an unusual itinerary. Rather than spend time exploring the city’s urban jungle, the first trip any of them made out of Southeast Asia was to hand-deliver a complaint letter to the obscure compliance department of Japan’s overseas aid coordinator, the Japan International Cooperation Agency (JICA).

Brought to Tokyo with the help of Japanese NGO Mekong Watch and other groups, the villagers came to lodge a formal complaint for grievances they said were brought on in part by JICA’s massive development efforts in their home nation — namely, the joint Japan-Myanmar consortium that evicted them from their homes in November to make way for a sprawling industrial estate.

The trip to Japan is just the latest move in a long-running dispute between Myanmar villagers and stakeholders in the Thilawa Special Economic Zone being built on the site of their former homes, just 20 kilometres southeast of Yangon, who say they were given insufficient compensation for their homes and farmland.

“The project proponent and the Myanmar government should improve, or at least restore, the affected people’s livelihood, or living standards,” a Mekong Watch representative said.

Instead, the villagers now find themselves pushed into cluttered tracts of land, stuck with dirty drinking water and cut off from the rest of their community. Compensation given for their property is quickly running dry. Largely out of work and in an unfamiliar environment, the villagers decided to take their concerns directly to JICA’s internal auditor for official review.

The move follows appeals made to JICA’s Yangon office after they were relocated that they said went unanswered. Local government officials also turned their backs on them, villagers said.

“After the villagers’ relocation, JICA didn’t reply to the villagers’ letters, and JICA also rejected the villagers’ request to meet the JICA, so that’s why the villagers decided to proceed to the objection procedures,” the Mekong Watch representative said. “One of the examiner’s roles is to confirm or to check the compliance of JICA’s guidelines. We hope that the examiner will proceed with the objection procedures and deeply investigate the compliance of JICA’s guidelines.”

Residents hope that JICA’s internal investigation, which will likely take at least two months if their allegations are judged worthy of review, will validate their claims and possibly bring about some much-needed help.

A JICA spokesperson in Yangon told local media that the burden is on the Myanmar government to ensure smooth resettlement, and that JICA has acted within its guidelines as an assistant to the process.

“[The] Myanmar government has responsibility for the resettlement caused by the project and JICA has provided technical assistance to [the] Myanmar government for the implementation of resettlement,” a JICA spokesperson told The Myanmar Times. “JICA thinks that [the] Myanmar government has conducted [the] resettlement process in accordance with JICA’s guidelines and it will be Myanmar’s first resettlement practice in line with international practices.”

Once completed sometime next year, the Thilawa SEZ will cover about 2,400 hectares and host its own thermal power plant capable of powering a spread of on-site factories. Fierce bidding is already under way among Japanese car builders for premium floor space, and one Myanmar official predicts the SEZ will create 200,000 jobs.

More than 300 residents were affected by the November move when 400 hectares of land were taken in the first phase of construction, but the relocation has been as much a litmus test as anything else, since more than 1,000 families are still scheduled to be moved in the near future as development spreads into the site’s remaining 2,000 hectares.

Chief among the concerns they’ve raised to JICA is how their resettlement came about. In relocation discussions held last year, villagers said government officials essentially forced them off their land under threat.

“Some villagers in the Phase 1 area of the Thilawa SEZ development project were told by government officials, such as from the village administrators’ level to the SEZ management committee level, and those officials said, ‘If you don’t sign you will never get compensation,’ or, ‘If you don’t sign your house will be bulldozed,’ so because of such a statement from the government officials some villagers were forced to sign the agreement on resettlement and compensation,” the Mekong Watch representative said.

As a result of the relocation, some of the 68 households moved are facing a previously unknown problem – incurring deep personal debt. Stuck in dire financial straits, 20 families have already sold their relocation plots after abrupt job losses forced them to spend their compensation money to get by.

Farmers who were given extra cash for the value of their crops — but not their farmland — have more reserves to fall back on, Mekong Watch said, but time is running out.

“If you see in the relocation site that there are some people who have already sold their house and lot, or they are now deeply in debt, which never happened to the villagers before the project,” the representative said. “So it’s obvious that the project has caused the deterioration of their living standards.”

When it came time to conduct an environmental impact assessment of the site last year, villagers said they were left in the dark.

“The problem regarding the EIA was they failed to let the villagers participate in the consultations,” the Mekong Watch representative said. “The villagers didn’t know the project proponents held the consultations about the EIA in advance. The villagers didn’t have information about the EIA.”

The assessment, which was published in September, notes that all analysis of possible livelihood loss must be done by the Myanmar government, and did not fall under the purview of the study.

According to a November resettlement plan published by the Thilawa consortium, JICA’s resettlement policies are governed by its Guidelines on Environmental and Social Considerations, which say resettled persons should be supported enough to “improve or at least restore their standard of living” and previous income levels. The guidelines note that involuntary resettlement should be “avoided when feasible”.

“At Thilawa SEZ in particular, the Japan International Cooperation Agency should use its financial leverage to immediately insist on proper compensation for resettled villagers and for the thousands more who will be resettled,” said Rachel Wagley, policy director for the US Campaign for Burma, which monitors foreign investment in the country.

The resettlement plan also says there is no Myanmar law applying to forced resettlement, and that Myanmar government rules on compensating relocated villagers, such as those found in the controversial 2012 Farmland Law covering land use, are not as robust as JICA’s own policies.

“The overarching problem is that Japan is ignoring best practices, international standards and its own internal guidelines as it pursues these development projects,” Ms Wagley said. “Japan has a responsibility to make Thilawa SEZ and other development efforts models for proper stewardship of foreign investment in Burma — a responsibility that they have abundant skills and resources to fulfill.”

Development gold rush

Although JICA only holds a 10 percent stake in the Thilawa SEZ — with an equally sized share held by the Myanmar government and the remainder divvied up among an array of Myanmar companies and Japanese conglomerates — it is but one of many projects the agency has brewing in the country.

Its Myanmar aid portfolio is diverse and wide-ranging, spanning from microcredit lending schemes in central Myanmar to building a network of weather radar stations to replace the country’s single defunct installation. Last year the two countries agreed on a JICA-led low-interest loan worth US $700 million to give a facelift to the country’s decrepit infrastructure, with up to 20 billion yen (US $195 million) earmarked for the Thilawa site alone.

The Thilawa SEZ is but one manifestation of what some say is a rush-to-build mentality endemic to Myanmar’s freewheeling business climate, which has attracted sizable interest from Japan to Norway and China.

“Foreign government agencies have moved much to quickly to get involved in large-scale infrastructure problems,” Burma Campaign UK Director Mark Farmaner said. “They are looking at the need for infrastructure, but ignoring the political reality on the ground. Burma has not yet gone through a transition to democracy where it has a government responding to the will and needs of the people, but they are treating the country as if it has.”

The Thilawa site is already generating considerable interest, and this week the US-based Ball Corporation was the first to ink a lease agreement. The company is slated to invest up to US $40 million in an aluminum can factory likely to employ about 150 workers, according to a report in The Myanmar Times.

Public shares in the Thilawa SEZ, which went on sale in March, quickly outpaced investor demand, and activists are worried that investors anxious to get in on the action might be ignoring what they say are murky conditions on the ground.

“These projects have massive social and environmental impacts, but the international community isn’t talking about these impacts or urging investors to perform proper due diligence,” Ms Wagley said.

Pushing to the boundaries

Japanese development efforts also extend to the country’s southeast, home to several ethnic minorities, where it aims to assist the internally displaced and undertake major infrastructure upgrades. It’s delicate territory for aid groups, as decades of on-and-off fighting between the government and ethnic rebel movements has left the region impoverished and difficult to access, while the area’s political future remains in limbo since no comprehensive peace plan has been made.

Since pursuing projects here, critics say that JICA has left local community groups in the dark.

“JICA is also surveying some comprehensive development projects in Karen State and Mon State. In this area JICA also fails to appropriately consult with the community organisations from the Karen or Mon,” the Mekong Watch representative said.

The representative added that while JICA has consulted the Karen National Union, the political body of a major rebel group, it has largely ignored the concerns of smaller community-based groups.

JICA’s ambitions for Karen State include vast plans to upgrade its pockmarked roads in a bid to “promote [the] return of international and internal displaced people,” according to a grant agreement signed last year. It’s this desire to pave the way for the return of hundreds of thousands displaced by fighting that community groups and villagers say is premature, given the precarious political situation.

The Karen Environmental and Social Action Network, a prominent Thailand-based group tracking international development in southeast Myanmar, warned in February that JICA’s efforts might “fuel conflict”.

“In ethnic states large-scale projects carry even greater risks, as local people see them as not only resource grabs, but also supporting a government agenda to try to pacify ethnic groups with so-called development projects, so that they won’t demand political rights,” Mr Farmaner said. “It is increasing suspicion that the government is not genuine about reaching a political settlement which protects ethnic rights and grants some level of autonomy.”

The aid arm isn’t the only Japanese group to take a recent interest in Myanmar’s rugged southeast. The Nippon Foundation, a major charity headed by a political ally of Japanese Prime Minister Shinzo Abe, committed US $60 million in aid in 2013 to fund food distribution, public health projects and the delivery of traditional herbal medicine to remote areas.

During this time it also served as a peace negotiator between ethnic rebels and the government — a role seen by some analysts, in conjunction with JICA’s projects, as part of a broader Japanese pivot to Southeast Asia to counter Chinese influence, underscored by Mr Abe’s visit to the country in late May, when he waived outstanding debt owed to Japan by Myanmar and pledged continued aid.

A long-time aid worker along the Thai-Myanmar border familiar with Japanese projects in the area, who asked not be identified, said he is disappointed with the way things have progressed, pointing to controversial land grabs and industrial projects. He says his approach, focusing on small-scale infrastructure projects at the village level, is a better course of action in a country still fraught with ethnic conflict and an opaque rule of law.

“The first point is whether it is workable for the people or not,” he said. “There are many people who are suffering and they cannot get any support from outside, so they have to survive by themselves.”

He counts among his efforts several experimental farming sites dotting eastern Karen State’s “black zones,” so called by the government because they are under the control of rebel forces. There he and his team train villagers in modern farming techniques among self-contained plots powered by small-scale renewable energy generators, such as water turbines. The goal, he said, is to one day make them financially secure enough to move away from raw produce and into finished goods.

But first, he said, residents must build up their infrastructure locally, and they must also feel assured that their land will remain in their hands, and won’t be contested by large conglomerates or government cronies seeking new territory.

“Many of their lands are occupied by the military. After that, the military sells to foreigners like Chinese businessmen,” he said. “It becomes a kind of pressure for the government and for the people. First they should get their own land, otherwise they cannot survive.”

Running educational farming projects in such hotly contested turf hasn’t been easy, the aid worker said, since until recent ceasefires these areas were also known as “free-fire zones,” where Myanmar Army soldiers were encouraged to shoot suspected insurgents on sight. In the “grey areas,” which are disputed between ethnic groups and the government, it requires working both sides to maintain a presence.

Key to his success, he said, has been his willingness to work closely with all sorts of local players, from militia commanders and government officials to village chieftains. Through this approach he has built trust, and says that having local support has paid dividends, resulting in communities happy to welcome outside help and weave it into their lives.

Major projects, the aid worker said, often fail to do this, and locals sometimes wind up out in the cold, uncertain of what’s happening in their neighbourhoods or what motives are actually driving foreign actors.

When toxic chemicals wind up in their streams or fish start disappearing from a communal lake, a pall of suspicion tends to fall on the large-scale developments.

“They don’t think of this kind of sustainable development for the people,” the aid worker said of those backing major projects. “Such kind of big development is totally not appropriate for the people. They break down the environment.”

The displacement at the Thilawa site, and its allegedly paltry compensation, isn’t surprising to the veteran aid worker, who said Myanmar’s economic gold rush has led to many such unintended consequences, pointing to a recent case he saw when developers displaced a small ethnic enclave from its long-time home near the northern town of Lashio in favour of a golf course.

“They forced them to move to another village, but the village is at a terrible location. Lack of water, the land is very poor,” the aid worker said. “For a golf resort it’s not necessary.”

With the Thilawa SEZ well under way, the aid worker said economic development is necessary for Myanmar’s populace to be lifted out of the veil of poverty that has smothered the country for so long. But at home among Karen State’s winding belts of virgin forest, still largely untouched after years of fighting and isolation, he wonders how, and at what cost, such growth will proceed.

“In all the other countries it’s gone, but in Myanmar, because of the civil war we still keep a piece of this forest,” he said. “So I sometimes wonder, what is peace?”

*This story first appeared in The Bangkok Post’s Spectrum Magazine published on June 22, 2014

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