An independent watchdog with links to theWorld Bank’s International Finance Corporation (IFC) is investigating a complaint that the Beijing-based Postal Savings Bank of China (PSBC) loaned money to a Chinese mining group involved in a plan to build a zinc mine in Indonesia’s North Sumatra without regard for environmental concerns, worrying locals.
The Compliance Adviser Ombudsman (CAO), which scrutinises the social and environmental concerns of communities affected by IFC-backed projects, launched the investigation because the PSBC – an IFC client that received a US$300 million equity investment in 2015 – loaned funds to the state-owned China Nonferrous Metal Mining Group and its Foreign Engineering and Construction Company (NFC) subsidiary in apparent contravention, activists say, of the IFC’s environmental and social standards.
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